<HTML>
<HEAD>
     <TITLE></TITLE>
</HEAD>
<BODY STYLE="font: 10pt Times New Roman, Times, Serif">

<P STYLE="margin: 0"></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0 1.45pt 0 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">SECURITIES
AND EXCHANGE COMMISSION</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Washington,
D.C. 20549</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 12pt 1.45pt 8pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>FORM
20-F</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.45pt 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">[
]&#9;REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES &#9;EXCHANGE ACT OF 1934</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.45pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">OR</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">[<B>X</B>]&#9;ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE &#9;ACT OF 1934</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">For
the Fiscal Year Ended March 31, 2015</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">OR</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin: 0 1.45pt 0 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">[
]&#9;TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES &#9;EXCHANGE ACT OF 1934</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin: 0 1.45pt 0 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">OR</FONT></P>

<P STYLE="font: 10pt/115% Times New Roman,serif; margin: 0 1.2pt 10pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">[
]&#9;SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Commission
File Number: 0-17601</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin: 0 1.2pt 8pt 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 11pt Times New Roman, Times, Serif"><B>BONSO
ELECTRONICS INTERNATIONAL INC.</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(Exact
name of Registrant as specified in its charter)</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin: 0 1.2pt 8pt 0"></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>British
Virgin Islands</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(Jurisdiction
of incorporation or organization)</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin: 0 1.2pt 8pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Unit
1404, 14/F, Cheuk Nang Centre,</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>9
Hillwood Road, Tsimshatsui</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Kowloon,
Hong Kong</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(Address
of principal executive offices)</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Albert
So, Chief Financial Officer</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Tel:
(852) 2605-5822 Fax: (852) 2691-1724</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Email:
albert@bonso.com</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Unit
1404, 14/F, Cheuk Nang Centre,</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>9
Hillwood Road, Tsimshatsui</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Kowloon,
Hong Kong</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(Name,
Telephone, email and/or fax number and address of Company Contact Person)&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Securities
registered or to be registered pursuant to Section 12(b) of the Act: <B>None.</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Securities
registered pursuant to Section 12(g) of the Act:&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-indent: 0.5in; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"></P>

<!-- Field: Page; Sequence: 1 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>COMMON
STOCK, PAR VALUE $.003</B></FONT></P>

<P STYLE="font: bold 10pt/normal Times New Roman,serif; margin: 12pt 1.45pt 12pt 0; text-indent: 0.5in"><FONT STYLE="font: normal 10pt Times New Roman, Times, Serif">Securities
for which there is a reporting obligation pursuant to Section 15(d) of the Act: </FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">
None.</FONT></P>

<P STYLE="font: 10pt/115% Times New Roman,serif; margin: 0 1.2pt 10pt 0; text-indent: 0.5in; text-align: justify"><FONT STYLE="font: normal 10pt Times New Roman, Times, Serif">Indicate
the number of outstanding shares of each of the issuer&rsquo;s classes of capital or common stock as of the close of the period
covered by the annual report.</FONT></P>

<P STYLE="font: 10pt/115% Times New Roman,serif; margin: 0 1.2pt 10pt 0; text-indent: 0.5in"><FONT STYLE="font: normal 10pt Times New Roman, Times, Serif">5,577,639
shares of common stock, $0.003 par value, at March 31, 2015 (including 330,736 shares that are held in treasury)</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Indicate
by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act of 1933.</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 0; text-align: center; margin-bottom: 8pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Yes
[ ]&#9;No [X]</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">If
the report is an annual or transition report, indicate by check mark if the Registrant is not required to file reports pursuant
to Section 13 or 15D of the Securities Exchange Act of 1934.</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Yes
[ ]&#9;No [X]</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Indicate
by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90 days.</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Yes
[X]&#9;No [ ]</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule&nbsp;405 of Regulation&nbsp;S-T (&sect;232.405 of this chapter)
during the preceding 12&nbsp;months (or for such shorter period that the registrant was required to submit and post such files).
Yes [ ] &nbsp;&nbsp; No [X]</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt/115% Times New Roman, Times, Serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2</FONT></P>

<P STYLE="font: 10pt/115% Times New Roman, Times, Serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"></P>

<!-- Field: Page; Sequence: 2 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Indicate
by check mark whether the Registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 33%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9;Large Accelerated Filer [ ]&#9;</FONT></TD>
    <TD STYLE="width: 34%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Accelerated Filer [ ]&#9;</FONT></TD>
    <TD STYLE="width: 33%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Non-accelerated filer [X]</FONT></TD></TR>
</TABLE>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Indicate
by check mark which basis of accounting the Registrant has used to prepare the financial statements included in this filing:</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-indent: 0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 33%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">U.S. GAAP [X]&#9;</FONT></TD>
    <TD STYLE="width: 47%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">International Financial Reporting Standards
    as issue by the International Accounting Standards Board [ ]</FONT></TD>
    <TD STYLE="width: 20%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9;Other [ ]</FONT></TD></TR>
</TABLE>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-indent: 0.5in"></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">If
&ldquo;Other&rdquo; has been checked in response to the previous question, indicate by check mark which financial statement item
the Registrant has elected to follow:&#9;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Item
17 [ ]&#9;Item 18 [ ]</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">If
this is an annual report, indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act.)</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Yes
[ ]&#9;No [X]</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt/115% Times New Roman, Times, Serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3</FONT></P>

<P STYLE="font: 10pt/115% Times New Roman, Times, Serif; margin: 5pt 1.2pt 5pt 0; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"></P>

<!-- Field: Page; Sequence: 3 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 1.2pt 0 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><U>TABLE
OF CONTENTS</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>



<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;PART I</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Page</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 11%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 1.</FONT></TD>
    <TD STYLE="width: 65%; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Identity
    of Directors, Senior Management and Advisors</FONT></TD><TD STYLE="width: 9%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 13%; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">6</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 2. &nbsp;</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Offer Statistics
    and Expected Timetable</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center">6</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 3.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Key Information</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">6</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 4.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Information on
    the Company</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">28</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 4A.&nbsp;</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Unresolved Staff
    Comments</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">41</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 5.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Operating and
    Financial Review and Prospects</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">41</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 6. &nbsp;&nbsp;&nbsp;</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Directors, Senior
    Management and Employees</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">60</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 7.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Major Shareholders
    and Related Party Transactions</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">71</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 8.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Financial Information</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">73</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 9.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The Offer and
    Listing</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">73</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 10.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Additional Information</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">75</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 11.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Quantitative and
    Qualitative Disclosures about Market Risk</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">79</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 12.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Description of
    Securities Other Than Equity Securities</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">80</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;PART II</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 13. &nbsp;</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Defaults, Dividend
    Arrearages and Delinquencies</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">80</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 14.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Material Modifications
    to the Rights of Security Holders and Use of Proceeds</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">80</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 15.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Controls and Procedures</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">80</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 16.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Reserved</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">83</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 16A.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Audit Committee
    Financial Expert</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">83</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 16B.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Code of Ethics</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">84</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 16C.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Principal Accountant
    Fees and Services</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">84</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 16D.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Exemptions from
    the Listing Standards for Audit Committees</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">86</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 16E.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Purchases of Equity
    Securities by the Issuer and Affiliates Purchasers</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">86</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 16F.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Changes in Registrant&rsquo;s
    Certifying Accountants</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">86</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 16G.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Corporate Governance</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">87</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 16H.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Mine Safety Disclosure</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">87</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">PART III</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 17.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Financial Statements</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">87</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 18.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Financial Statements</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">F-1
                                         to F-40</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Item 19.</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Exhibits</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">88</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD COLSPAN="2"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">SIGNATURES</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
</TABLE>


<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt/115% Times New Roman, Times, Serif; margin: 5pt 1.2pt 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4</FONT></P>

<P STYLE="font: 10pt/115% Times New Roman, Times, Serif; margin: 5pt 1.2pt 5pt 0; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 4 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin: 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>FORWARD-LOOKING
STATEMENTS</B></FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">This
Annual Report on Form 20-F contains forward-looking statements. A forward-looking statement is a projection about a future event
or result, and whether the statement comes true is subject to many risks and uncertainties. These statements often can be identified
by the use of terms such as &ldquo;may,&rdquo; &ldquo;will,&rdquo; &ldquo;expect,&rdquo; &ldquo;believe,&rdquo; &ldquo;anticipate,&rdquo;
&ldquo;estimate,&rdquo; &ldquo;approximate&rdquo; or &ldquo;continue,&rdquo; or the negative thereof. The actual results or activities
of the Company will likely differ from projected results or activities of the Company as described in this Annual Report, and
such differences could be material.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Forward-looking
statements involve known and unknown risks, uncertainties and other factors that may cause the actual results and performance
of the Company to be different from any future results, performance and achievements expressed or implied by these statements.
In other words, our performance might be quite different from what the forward-looking statements imply. You should review carefully
all information included in this Annual Report.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">You
should rely only on the forward-looking statements that reflect management's view as of the date of this Annual Report. We undertake
no obligation to publicly revise or update these forward-looking statements to reflect subsequent events or circumstances. You
should also carefully review the risk factors described in other documents we file from time to time with the Securities and Exchange
Commission (the &ldquo;SEC&rdquo;). The Private Securities Reform Act of 1995 contains a safe harbor for forward-looking statements
on which the Company relies in making such disclosures. In connection with the &ldquo;safe harbor,&rdquo; we are hereby identifying
important factors that could cause actual results to differ materially from those contained in any forward-looking statements
made by us or on our behalf. Factors that might cause such a difference include, but are not limited to, those discussed in the
section entitled &ldquo;Risk Factors&rdquo; under Item 3. - Key Information.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>FINANCIAL
STATEMENTS AND CURRENCY PRESENTATION</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States
of America and publish our financial statements in United States Dollars.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>REFERENCES</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
this Annual Report, &ldquo;China&rdquo; refers to all parts of the People's Republic of China other than the Special Administrative
Region of Hong Kong. The terms &ldquo;Bonso,&rdquo; &ldquo;we,&rdquo; &ldquo;our,&rdquo; &ldquo;us,&rdquo; &ldquo;the Group&rdquo;
and the &ldquo;Company&rdquo; refer to Bonso Electronics International Inc. and, where the context so requires or suggests, our
direct and indirect subsidiaries. References to &ldquo;dollars,&rdquo; &ldquo;U.S. Dollars&rdquo; or &ldquo;US$&rdquo; are to
United States Dollars, &ldquo;HK$&rdquo; are to Hong Kong Dollars, &ldquo;Euros&rdquo; or &ldquo;euro&rdquo; are to the European
Monetary Union's Currency and &ldquo;RMB&rdquo; are to Chinese Renminbi.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">5</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 5 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>PART
I</B></FONT></P>

<P STYLE="font: bold 12pt/115% Times New Roman,serif; margin: 0 0 10pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/115% Times New Roman,serif; margin: 0 0 10pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Item
1. Identity of Directors, Senior Management and Advisors</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Not
Applicable to Bonso.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/115% Times New Roman,serif; margin: 0 0 10pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Item
2. Offer Statistics and Expected Timetable</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Not
Applicable to Bonso.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/115% Times New Roman,serif; margin: 0 0 10pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Item
3. Key Information</FONT></P>

<P STYLE="font: bold 12pt/115% Times New Roman,serif; margin: 0 0 10pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 36pt"></TD><TD STYLE="width: 22pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>A.</I></B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>Selected
                                         Financial Data.</I></B></FONT></TD></TR></TABLE>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
selected consolidated financial data as of March 31, 2014 and 2015 and for each of the three fiscal years ended March 31, 2013,
2014 and 2015 are derived from the Audited Consolidated Financial Statements and notes which appear elsewhere in this Annual Report.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Financial Statements are prepared in accordance with generally accepted accounting principles in the United States of America
and expressed in United States Dollars. The selected consolidated financial data set forth below as of March 31, 2011, 2012 and
2013, and for each of the two fiscal years in the period ended March 31, 2011 and 2012, have been derived from our audited consolidated
financial statements that are not included in this Annual Report.&nbsp;&nbsp;The selected consolidated financial data is qualified
in their entirety by reference to, and should be read in conjunction with, the Consolidated Financial Statements and related notes
included in the F pages of this Annual Report and Item 5. &ndash; &ldquo;Operating and Financial Review and Prospects&rdquo; included
in this Annual Report.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0 0 10pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>[REMAINDER
OF THIS PAGE LEFT BLANK INTENTIONALLY]</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0 0 10pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">6</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0 0 10pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0 0 10pt; text-align: center"></P>

<!-- Field: Page; Sequence: 6 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0 0 10pt; text-align: center">&nbsp;</P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0 0 10pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><BR CLEAR="ALL">
SELECTED CONSOLIDATED FINANCIAL DATA</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Statement
of Operations Data</B></FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(in
000&rsquo;s US$ except for shares and per share data)</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="19" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><B>Year Ended March 31,</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 35%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt; padding-left: 5.4pt">&nbsp;</TD><TD STYLE="width: 2%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><B>2011<SUP>(1)</SUP></B></TD><TD STYLE="width: 1%; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif; text-align: left"><B></B></TD><TD STYLE="width: 2%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"><B>&nbsp;</B></TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><B>&nbsp;</B></TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><B>2012<SUP>(1)</SUP></B></TD><TD STYLE="width: 1%; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif; text-align: left"><B>(1)</B></TD><TD STYLE="width: 2%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"><B>&nbsp;</B></TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><B>&nbsp;</B></TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><B>2013<SUP>(1)</SUP></B></TD><TD STYLE="width: 1%; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif; text-align: left"><B></B></TD><TD STYLE="width: 2%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"><B>&nbsp;</B></TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><B>&nbsp;</B></TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><B>2014</B><SUP>(<B>1)</B></SUP></TD><TD STYLE="width: 1%; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif; text-align: left"><B></B></TD><TD STYLE="width: 2%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"><B>&nbsp;</B></TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"><B>&nbsp;</B></TD><TD STYLE="width: 9%; border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><B>2015</B></TD><TD STYLE="width: 1%; padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt; padding-left: 5.4pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$</FONT></TD><TD STYLE="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$</FONT></TD><TD STYLE="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$</FONT></TD><TD STYLE="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$</FONT></TD><TD STYLE="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$</FONT></TD><TD STYLE="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Net sales</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">28,387</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">26,682</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">30,386</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">31,305</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">28,944</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt">Cost of sales</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(24,760</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(22,782</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(25,263</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(28,631</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(23,092</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Gross profit</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">3,627</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">3,900</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,123</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">2,674</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,852</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Rental income</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">35</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">34</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">45</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">708</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">1,453</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Selling expenses</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(249</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(267</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(268</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(389</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(822</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Salaries and related costs</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(2,716</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(2,526</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(2,627</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(2,983</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(3,166</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Research and development expenses</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(334</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(312</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(396</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(366</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(228</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Administration and general expenses</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(1,959</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(2,492</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(2,402</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(2,964</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(3,245</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Gain from liquidation of subsidiary</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">1,448</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Other income</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">149</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">84</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">120</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">20</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">520</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Gain on disposal of property, plant and equipment</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">155</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">14</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">2</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">3,595</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">98</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">(Loss) / income from operations</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(1,292</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(117</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(403</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">295</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">462</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Interest income</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">6</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">7</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">7</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">64</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">18</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Interest expense</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(56</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(87</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(68</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(136</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(273</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Foreign exchange loss</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(130</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(703</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(261</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(444</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(134</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Gain on disposal of intangible assets</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">41</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">(Loss) / income before income taxes</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(1,431</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(900</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(725</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(221</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">73</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Income tax (expense) / credit</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(2</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(29</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">1,037</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">(Loss) / income from continuing operations</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(1,431</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(902</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(754</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(221</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">1,110</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">Loss from discontinued operations<SUP>(2)</SUP></FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(129</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Net (loss) / income</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(1,560</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(902</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(754</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">(221</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">1,110</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 9pt; text-align: left; padding-left: 5.4pt"><P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Net (loss) / earnings per share - basic and diluted<SUP>(3)</SUP></FONT></P> <P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-indent: -0.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Continuing operations</FONT></P> <P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-indent: -0.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Discontinued operations</FONT></P> <P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-indent: -0.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total</FONT></P></TD><TD STYLE="font-size: 9pt">&nbsp;</TD>
    <TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: right"><P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><br>($0.27)</FONT></P> <P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">($0.02)</FONT></P> <P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">($0.29)</FONT></P></TD><TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt">&nbsp;</TD>
    <TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: right"><P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><br>($0.17)</FONT></P> <P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">($0.00)</FONT></P> <P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">($0.17)</FONT></P></TD><TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt">&nbsp;</TD>
    <TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: right"><P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><br>($0.14)</FONT></P> <P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">($0.00)</FONT></P> <P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">($0.14)</FONT></P></TD><TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt">&nbsp;</TD>
    <TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: right"><P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><br>($0.04)</FONT></P> <P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">($0.00)</FONT></P> <P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">($0.04)</FONT></P></TD><TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt">&nbsp;</TD>
    <TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: right"><P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><br>$0.21</FONT></P> <P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$0.00</FONT></P> <P STYLE="font: 9pt/107% Arial Unicode MS,sans-serif; margin: 5pt 8.95pt 5pt 0; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$0.21</FONT></P></TD><TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt">Weighted average shares</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,246,903</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,246,903</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,246,903</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,246,903</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,246,903</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt">Diluted weighted average shares</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,246,903</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,246,903</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,246,903</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,246,903</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5,246,903</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>&nbsp;</SUP></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>(1)
</SUP>Certain accounts in the statement of operations for the fiscal years ended March 31, 2011, 2012, 2013 and 2014 have been
reclassified to conform with the presentation for the fiscal year ended March 31, 2015.</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>(2)
</SUP>Loss from discontinued operations represents the results of Korona Haushaltswaren GmbH &amp; Co. KG (&ldquo;Korona&rdquo;),
a former subsidiary, which was liquidated in February 2012.</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>(3)
</SUP>The diluted net (loss) / earnings per share was the same as the basic net (loss) / earnings per share for the fiscal years
ended March 31, 2011, 2012, 2013, 2014 and 2015 as all potential common shares, including the stock options, are anti-dilutive
and therefore excluded from the computation of diluted net (loss) / earnings per share.</FONT></P>

<P STYLE="font: 9pt/115% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">7<FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 7 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Balance
Sheet Data</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(in
000&rsquo;s US$ except for shares and per share data)</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="19" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><B>March 31,</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><B>2011</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><B>2012</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><B>2013</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><B>2014</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/115% Times New Roman, Times, Serif"><B>2015</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1pt; padding-left: 5.4pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font: 10pt/115% Times New Roman, Times, Serif">$</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 35%; text-align: left; padding-left: 5.4pt">Cash and cash equivalents, and fixed deposits maturing over
    three months</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">5,407</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">3,014</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">2,154</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,165</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">3,027</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Working capital of continuing operations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,657</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,484</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(160</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(3,769</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(4,391</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Total assets of continuing operations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">21,807</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,168</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27,123</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">32,140</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25,777</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">Total assets of discontinued operations<SUP>(1)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Total assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">21,812</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,168</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27,123</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">32,140</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25,777</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Current liabilities of continuing operations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,285</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,293</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,942</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">18,646</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,429</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Non-current financial liabilities at fair value</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">208</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">112</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Income tax liabilities, non-current portion</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,595</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,595</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,595</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,595</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Total liabilities of continuing operations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,899</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11,890</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">16,537</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">21,518</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,922</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">Total liabilities of discontinued operations<SUP>(1)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,086</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Common stock</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Shareholders&rsquo; equity</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11,827</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11,278</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,586</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,622</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11,855</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 5.4pt">Dividends declared per share</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>&nbsp;</SUP></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>(1)
</SUP>Total assets and liabilities of discontinued operations represent total assets and liabilities of Korona, a former subsidiary,
which was liquidated in February 2012.</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Risk
Factors</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">You
should carefully consider the following risks, together with all other information included in this Annual Report. The realization
of any of the risks described below could have a material adverse effect on our business, results of operations and future prospects.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">8</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"></P>

<!-- Field: Page; Sequence: 8 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Political,
Legal, Economic and Other Uncertainties of Operations in China and Hong Kong</B></FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><I>We
Could Face Increased Currency Risks If China Does Not Maintain The Stability Of The Hong Kong Dollar or the Chinese Renminbi.
</I>The Hong Kong Dollar and the United States Dollar have been fixed at approximately 7.80 Hong Kong Dollars to 1.00 U.S. Dollar
since 1983. The market exchange rate has not deviated materially from the level of HK$7.80 to US$1.00 since the peg was first
established. However, in May 2005, the Hong Kong Monetary Authority broadened the trading band from the original rate of HK$7.80
per U.S. dollar to a rate range of HK$7.75 to HK$7.85 per U.S. dollar. The Hong Kong government has stated its intention to maintain
the link at that rate. From 1994 until July 2005, the Chinese Renminbi had remained stable against the U.S. Dollar at approximately
8.28 to 1.00 U.S. Dollar. On July 21, 2005, the Chinese currency regime was altered to link the RMB to a &ldquo;basket of currencies,&rdquo;
which includes the U.S. Dollar, Euro, Japanese Yen and Korean Won. Under the rules, the RMB was allowed to move 0.3% on a daily
basis against the U.S. Dollar. The People's Bank of China, on May 21 2007, widened the RMB trading band from 0.3% daily movement
against the U.S. Dollar to 0.5%. Following the removal of the U.S. Dollar peg, the RMB appreciated more than 20% against the U.S.
Dollar over the following three years. Since July 2008, however, the RMB has traded within a narrow range against the U.S. Dollar.
As a consequence, the RMB has fluctuated significantly since July 2008 against other freely traded currencies, in tandem with
the U.S. Dollar. On June&nbsp;20, 2010, the People&rsquo;s Bank of China (&ldquo;PBOC&rdquo;) announced that the government of
the People&rsquo;s Republic of China (&ldquo;PRC&rdquo;) would further reform the RMB exchange rate regime and increase the flexibility
of the exchange rate. </FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif"> <FONT STYLE="line-height: 107%">Since June&nbsp;2010,
the PRC government has allowed the RMB to appreciate slowly against the U.S. dollar again, though there have been periods when
the U.S. dollar has appreciated against the Renminbi as well. It is difficult to predict how market forces or PRC or U.S. government
policy may impact the exchange rate between the RMB and the U.S. dollar in the future. As of July 15, 2015, the RMB was valued
at 6.1089 per U.S. Dollar. Any significant revaluation of the RMB may materially and adversely affect our cash flows, revenues,
earnings and financial position and the value of our common shares and any dividends payable to our common shareholders in U.S.
Dollars. </FONT>&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Chinese government in the past has expressed its intention in the Basic Law of the PRC to maintain the stability of the Hong Kong
currency after the sovereignty of Hong Kong was transferred to China in July 1997. However, there can be no assurance that the
Hong Kong Dollar will remain pegged against the U.S. Dollar. If the current exchange rate mechanism is changed, we will face increased
currency risks, which could have a material adverse effect upon the Company.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">9</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 9 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
Face Significant Risks If The Chinese Government Changes Its Policies, Laws, Regulations Or Tax Structure Or Its Current Interpretations
Of Its Laws, Rules And Regulations Relating To Our Operations In China. </I>Our property in Shenzhen and our manufacturing facility
in Xinxing are located in China. As a result, our operations and assets are subject to significant political, economic, legal
and other uncertainties. Changes in policies by the Chinese government resulting in changes in laws or regulations or the interpretation
of laws or regulations, confiscatory taxation, changes in employment restrictions, restrictions on imports and sources of supply,
import duties, corruption, currency revaluation or the expropriation of private enterprise could materially and adversely affect
us. Over the past several years, the Chinese government has pursued economic reform policies, including the encouragement of private
economic activity and greater economic decentralization. If the Chinese government does not continue to pursue its present policies
that encourage foreign investment and operations in China, or if these policies are either not successful or are significantly
altered, then our business operations in China could be adversely affected. We could even be subject to the risk of nationalization,
which could result in the total loss of investment in that country. Following the Chinese government&rsquo;s policy of privatizing
many state-owned enterprises, the Chinese government has attempted to augment its revenues through increased tax collection. Continued
efforts to increase tax revenues could result in increased taxation expenses being incurred by us. Economic development may be
limited as well by the imposition of austerity measures intended to reduce inflation, the inadequate development of infrastructure
and the potential unavailability of adequate power and water supplies, transportation and communications. If for any reason we
were required to move our manufacturing operations outside of China, our profitability would be substantially impaired, our competitiveness
and market position would be materially jeopardized and we might have to discontinue our operations.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Continuing
Economic Weakness May Adversely Affect Our Earnings, Liquidity And Financial Position. </I>The Company&rsquo;s business has been
challenging recently as a consequence of adverse worldwide economic conditions. In particular, there has been an erosion of global
consumer confidence from concerns over declining asset values, price instability, geopolitical issues, the availability and cost
of credit, rising unemployment and the stability and solvency of financial institutions, financial markets, businesses and sovereign
nations. These concerns slowed global economic growth and resulted in recessions in many countries, including in the U.S., Europe
and certain countries in Asia. The global economic weakness has negatively impacted our operating results since 2008. Overall,
the economic outlook is uncertain as a result of concerns about the general global economy and the decreased rate of growth in
China and the European Union. Recessionary conditions may return. If negative economic conditions return, a number of material
adverse effects on our business could occur and could have a negative impact upon our results of operations. Further, slower overall
growth of the Chinese economy may have a material adverse effect upon the Company and its results of operations. Also, the Company&rsquo;s
Shenzhen factory is leased out to a third party whose main business is manufacturing of printing and packaging materials to be
sold domestically. Negative economic conditions in China would affect the results of operations of this tenant, which may not
be able to pay future rent to the Company in full or in time according to the lease agreement.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 10 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>The
Economy Of China Has Been Experiencing Significant Growth, Leading To Some Inflation and Increased Labor Costs. </I>The economy
in China has grown significantly over the past 20 years, which has resulted in inflation and an increase in the average cost of
labor, especially in the coastal cities. China&rsquo;s consumer price index, the broadest measure of inflation, rose 2.42% in
June 2014 from the level in June 2013 and 1.40% between June 2014 and June 2015. Although slowing down recently, China&rsquo;s
overall economy and the average wage in the PRC are expected to continue to grow. Continuing inflation and material increases
in the cost of labor in China could diminish our competitive advantage. If the government tries to control inflation, it may have
an adverse effect on the business climate and growth of private enterprise in the PRC. An economic slowdown may reduce our revenues.
If inflation is allowed to proceed unchecked, our costs would likely increase, and there can be no assurance that we would be
able to increase our prices to an extent that would offset the increase in our expenses.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 24.5pt"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Changes
To PRC Tax Laws And Heightened Efforts By China&rsquo;s Tax Authorities To Increase Revenues Are Expected To Subject Us To Greater
Taxes. </I>&nbsp;Since January 1, 2012, our PRC subsidiaries have been subject to a single PRC enterprise income tax rate of 25%.
We base our tax position upon the anticipated nature and conduct of our business and upon our understanding of the tax laws of
the various administrative regions and countries in which we have assets or conduct activities. However, our tax position is subject
to review and possible challenge by taxing authorities and to possible changes in law, which may have retroactive effect. We cannot
determine in advance the extent to which some jurisdictions may require us to pay taxes or make payments in lieu of taxes.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
Face Risks By Operating In China, Because The Chinese Legal System Relating To Foreign Investment And Foreign Operations Such
As Bonso&rsquo;s Is Evolving And The Application Of Chinese Laws Is Uncertain. </I>The legal system of China relating to foreign
investments is continually evolving, and there can be no certainty as to the application of its laws and regulations in particular
instances. The Chinese legal system is a civil law system based on written statutes. Unlike common law systems, it is a system
in which decided legal cases have little precedential value. In 1979, the Chinese government began to promulgate a comprehensive
system of laws and regulations governing economic matters in general. Legislation over the past 30 years has significantly enhanced
the protections afforded to various forms of foreign investment in China. Enforcement of existing laws or agreements may be sporadic
and implementation and interpretation of laws inconsistent. The Chinese judiciary is relatively inexperienced in enforcing the
laws that exist, leading to a higher than usual degree of uncertainty as to the outcome of any litigation. Even where adequate
law exists in China, it may not be possible to obtain swift and equitable enforcement of that law. Further, various disputes may
be subject to the exercise of considerable discretion by agencies of the Chinese government, and forces and factors unrelated
to the legal merits of a particular matter or dispute may influence their determination. Continued uncertainty relating to the
laws in China and the application of the laws could have a material adverse effect upon us and our operations in China.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">11</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 11 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Controversies
Affecting China&rsquo;s Trade With The United States Could Harm Our Results Of Operations Or Depress Our Stock Price.</I> While
China has been granted permanent most favored nation trade status in the United States through its entry into the World Trade
Organization, controversies between the United States and China may arise that threaten the status quo involving trade between
the United States and China. These controversies could materially and adversely affect our business by, among other things, causing
our products in the United States to become more expensive, resulting in a reduction in the demand for our products by customers
in the United States, which would have a material adverse effect upon us and our results of operations. Further, political or
trade friction between the United States and China, whether or not actually affecting our business, could also materially and
adversely affect the prevailing market price of our common shares.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>If
Our Factories Were Destroyed Or Significantly Damaged As A Result of Fire, Flood Or Some Other Natural Disaster, We Would Be Adversely
Affected</I>. All of our products are manufactured at our manufacturing facilities located in Xinxing, Guangdong, China. Fire-fighting
and disaster relief or assistance in China may not be as developed as in Western countries. We currently maintain property damage
insurance aggregating approximately $34 million covering our stock in trade, goods and merchandise, furniture and equipment and
buildings. We do not maintain business interruption insurance. Investors are cautioned that material damage to, or the loss of,
our factories due to fire, severe weather, flood or other act of God or cause, even if insured, could have a material adverse
effect on our financial condition, results of operations, business and prospects.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Our
Results Could Be Harmed If We Have To Comply With New Environmental Regulations.</I> Our operations create some environmentally
sensitive waste that may increase in the future depending on the nature of our manufacturing operations. The general issue of
the disposal of hazardous waste has received increasing attention from China&rsquo;s national and local governments and foreign
governments and agencies and has been subject to increasing regulation. Our business and operating results could be materially
and adversely affected if we were to increase expenditures to comply with any new environmental regulations affecting our operations.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">12</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 12 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Enforcement
Of The Labor Contract Law, Minimum Wage Increases And Future Changes In The Labor Laws In China May Result In The Continued Increase
In Labor Costs. </I>On June&nbsp;29, 2007, the Standing Committee of the National People&rsquo;s Congress of China enacted the
Labor Contract Law, which became effective on January&nbsp;1, 2008. The Labor Contract Law introduces specific provisions related
to fixed-term employment contracts, part-time employment, probation, consultation with labor union and employee assemblies, employment
without a written contract, dismissal of employees, severance and collective bargaining, which together represent enhanced enforcement
of labor laws and regulations. According to the Labor Contract Law, an employer is obliged to sign an unlimited-term labor contract
with any employee who has worked for the employer for 10 consecutive years. Further, if an employee requests or agrees to renew
a fixed-term labor contract that has already been entered into twice consecutively, the resulting contract must have an unlimited
term, with certain exceptions. The employer must also pay severance to an employee in nearly all instances where a labor contract,
including a contract with an unlimited term, is terminated or expires. In addition, the government has continued to introduce
various new labor-related regulations after the Labor Contract Law. Among other things, new annual leave requirements mandate
that annual leave ranging from 5 to 15 days is available to nearly all employees and further require that the employer compensate
an employee for any annual leave days the employee is unable to take in the amount of three times his daily salary, subject to
certain exceptions. In addition, as the interpretation and implementation of these new regulations are still evolving, we cannot
assure you that our employment practices do not, or will not, violate the Labor Contract Law and other labor-related regulations.
Between the fiscal years ended March 31, 2010 and 2014, we experienced an increase in the cost of labor caused by the increase
in the minimum hourly rate. In accordance with the new minimum wage set by the local authorities, we increased the minimum wage
for our labor in Shenzhen from RMB 1,100 (or approximately $162) per month to RMB 1,320 (or approximately $206) per month beginning
April 1, 2011. The minimum wage was increased to RMB 1,500 (or approximately $238) per month beginning February 1, 2012. The minimum
wage in Shenzhen was increased to RMB 1,600 (or approximately $254) per month beginning March 1, 2013, and later to RMB 1,808
(or approximately $293) per month beginning February 1, 2014. We started hiring workers in our Xinxing factory during the fiscal
year ended March 31, 2013, and the minimum wage at that time in Xinxing was RMB 1,010 per month (or approximately $160). Since
May 1, 2015, the minimum wage at Xinxing has been RMB 1,210 per month (or approximately $197 per month). We believe that increased
labor costs in China will have a significant effect on our total production costs and results of operations and that we will not
be able to continue to increase our production at our manufacturing facilities without substantially increasing our non-production
salaries and related costs. If we are subject to severe penalties or incur significant liabilities in connection with the enforcement
of the Labor Contract Law, disputes or investigations, our business and results of operations may be adversely affected. Any future
changes in the labor laws in the PRC could result in our having to pay increased labor costs. There can be no assurance that the
labor laws will not change, which may have a material adverse effect upon our business and our results of operations.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">13</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 13 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>If
We Were To Lose Our Existing Banking Facilities Or Those Facilities Were Substantially Decreased Or Less Favorable Terms Were
Imposed Upon Us, The Company Could Be Materially And Adversely Affected. </I>We maintain banking facilities with Hang Seng Bank
Limited and China Construction Bank, which are subject to renewal on an annual basis. We use these banking facilities to fund
our working capital requirements. The credit markets in Hong Kong and throughout the world have tightened and experienced extraordinary
volatility and uncertainty. We have had discussions with several of our banks and believe that the availability of our banking
facilities will continue on terms that are acceptable to us. However, as a result of changes in the capital or other legal requirements
applicable to the banks or if our financial position and operations were to deteriorate further, our costs of borrowing could
increase or the terms of our banking facility could be changed so as to impact our liquidity. If we are unable to obtain needed
capital on terms acceptable to us, our business, financial condition, results of operations and cash flows could be materially
adversely affected.<BR></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
July 2015, the Company entered into an agreement with an unaffiliated third party to sell part of the Company&rsquo;s land use
right in Xinxing, PRC for approximately $866,000. The area of this piece of land is approximately 18% of the total land area of
our Xinxing facility, and is included in the land use rights which were pledged as security for one of our banking facilities.
The Company is negotiating with the bank for the release of this parcel of land. However, the bank could block the sale of the
parcel or could demand that the Company repay the loan in full. In addition, the sale of the land could result in a reduction
of the value of the remaining land use right, which could make it more difficult for the Company to obtain similar credit limits
and acceptable credit terms in the future.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Risk
Factors Relating to Our Business</B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
Depend Upon Our Largest Customers For A Significant Portion Of Our Sales Revenue, And We Cannot Be Certain That Sales To These
Customers Will Continue. If Sales To These Customers Do Not Continue, Then Our Sales Will Decline And Our Business Will Be Negatively
Impacted. </I>We have relied upon three customers for a significant portion of our sales. During the fiscal years ended March
31, 2013, 2014 and 2015, these three customers accounted for approximately 83%, 87% and 80% of sales, respectively. During the
fiscal year ended March 31, 2015, 37% of our sales were to a single customer (45% of our sales to another single customer during
the fiscal year ended March 31, 2014). We do not enter into long-term contracts with our customers but manufacture based upon
purchase orders and therefore cannot be certain that sales to these customers will continue. Our largest customer in 2013, which
accounted for 52% of our net sales in that year, represented 45% in 2014 and 24% in 2015. The loss of any of our largest customers
would likely have a material negative impact on our sales revenue and our business.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Defects
In Our Products Could Impair Our Ability To Sell Our Products Or Could Result In Litigation And Other Significant Costs. </I>Detection
of any significant defects in our products may result in, among other things, delay in time-to-market, loss of market acceptance
and sales of our products, diversion of development resources, injury to our reputation or increased warranty costs. Because our
products are complex, they may contain defects that cannot be detected prior to shipment. These defects could harm our reputation,
which could result in significant costs to us and could impair our ability to sell our products. The costs we may incur in correcting
any product defects may be substantial and could decrease our profit margins.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">14</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 14 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Since
certain of our products are used in applications that are integral to our customers&rsquo; businesses, errors, defects or other
performance problems could result in financial or other damages to our customers, which would likely result in adverse effects
upon our business with these customers. If we were involved in any product liability litigation, even if it were unsuccessful,
it would be time-consuming and costly to defend. Further, our product liability insurance may not be adequate to cover claims.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Our
Sales Through Retail Merchants Result In Seasonality, Susceptibility To A Downturn In The Retail Economy And Sales Variances Resulting
From Retail Promotional Programs. </I>Many of our customers sell to retail merchants. Accordingly, these portions of our customer
base are susceptible to downturns in the retail economy. A greater number of our sales of scales products occur between the months
of July and October in preparation for the Christmas holiday. Throughout the remainder of the year, our products do not appear
to be subject to significant seasonal variation. However, past sales patterns may not be indicative of future performance.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Our
Customers Are Dependent On Shipping Companies For Delivery Of Our Products, And Interruptions To Shipping Could Materially And
Adversely Affect Our Business And Operating Results. </I>Typically, we sell our products either F.O.B. Hong Kong, Yantian (Shenzhen)
or Nansha (Guangzhou), and our customers are responsible for the transportation of products from Hong Kong, Yantian (Shenzhen)
or Nansha (Guangzhou) to their final destinations. Our customers rely on a variety of carriers for product transportation through
various world ports. A work stoppage, strike or shutdown of one or more major ports or airports could result in shipping delays
materially and adversely affecting our customers, which in turn could have a material adverse effect on our business and operating
results. Similarly, an increase in freight surcharges due to rising fuel costs or general price increases could materially and
adversely affect our business and operating results.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Customer
Order Estimates May Not Be Indicative Of Actual Future Sales. </I>Some of our customers have provided us with forecasts of their
requirements for our products over a period of time. We make many management decisions based on these customer estimates, including
purchasing materials, hiring personnel and other matters that may increase our production capacity and costs. If a customer reduces
its orders from prior estimates after we have increased our production capabilities and costs, this reduction may decrease our
net sales and we may not be able to reduce our costs to account for this reduction in customer orders. Many customers do not provide
us with forecasts of their requirements for our products. If those customers place significant orders, we may not be able to increase
our production quickly enough to fulfill the customers&rsquo; orders. The inability to fulfill customer orders could damage our
relationships with customers and reduce our net sales.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">15</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 15 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Pressure
By Our Customers To Reduce Prices And Agree To Long-Term Supply Arrangements May Cause Our Net Sales Or Profit Margins To Decline.
</I>Our customers are under pressure to reduce prices of their products. Therefore, we expect to experience increasing pressure
from our customers to reduce the prices of our products. Continuing pressure to reduce the price of our products could have a
material adverse effect upon our business and operating results. Our customers frequently negotiate supply arrangements with us
well in advance of placing orders for delivery within a year, thereby requiring us to commit to price reductions before we can
determine if we can achieve the assumed cost reductions. We believe we must reduce our manufacturing costs and obtain higher volume
orders to offset declining average sales prices. Further, if we are unable to offset declining average sales prices, our gross
profit margins will decline, which would have a material adverse effect upon our results of operations.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
Depend Upon Our Key Personnel, And The Loss Of Any Key Personnel, Or Our Failure To Attract And Retain Key Personnel, Could Adversely
Affect Our Future Performance, Including Product Development, Strategic Plans, Marketing And Other Objectives.</I> The loss or
failure to attract and retain key personnel could significantly impede our performance, including product development, strategic
plans, marketing and other objectives. Our success depends to a substantial extent not only on the ability and experience of our
senior management, but particularly upon Anthony So, our Chairman of the Board. We do not have key man life insurance on Mr. So.
To the extent that the services of Mr. So would be unavailable to us, we would be required to obtain another person to perform
the duties Mr. So otherwise would perform. We may be unable to employ another qualified person with the appropriate background
and expertise to replace Mr. So on terms suitable to us.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Contractual
Arrangements We Have Entered Into Among Us And Our Subsidiaries May Be Subject To Scrutiny By The Respective Tax Authorities,
And A Finding That Bonso And Its Subsidiaries Owe Additional Taxes Could Substantially Reduce Our Consolidated Net Income And
The Value Of Your Investment.</I> We could face material and adverse tax consequences if the respective tax authorities determine
that the contractual arrangements among our subsidiaries and Bonso do not represent an arm&rsquo;s length price and adjust Bonso&rsquo;s,
or any of its subsidiaries&rsquo;, income in the form of a transfer pricing adjustment. Bonso did not consider it necessary to
make tax provision in this respect. However, there can be no assurance that the assessment performed by the local tax authorities
will result in the same position. A transfer pricing adjustment could, among other things, result in a reduction, for tax purposes,
of expense deductions recorded by Bonso or any of its subsidiaries, which could in turn increase its tax liabilities. In addition,
the tax authorities may impose late payment fees and other penalties on our affiliated entities for underpaid taxes. Our consolidated
net income may be materially and adversely affected if our affiliated entities&rsquo; tax liabilities increase or if they are
found to be subject to late payment fees or other penalties.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">16</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 16 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Increased
Prices For Raw Materials May Have A Negative Impact Upon Us.</I> The price level of raw materials decreased slightly in the fiscal
year ended March 31, 2015, compared to that in the fiscal year ended March 31, 2014. The price of some of the raw materials fluctuates
directly with the price of oil. If oil prices were to increase in the future, it will likely result in an increase in the costs
of components to us, as well as an increase in our operating expenses, which could have a material adverse effect upon our business
and results of operations.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT>&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
May Face An Increased Shortage Of Factory Workers. </I>Currently, we have a sufficient number of factory workers at our Xinxing
factory and do not expect a significant labor shortage in the next 12 months. However, there can be no assurance that we will
not experience an increased need for workers in China in the future or that we will be able to adequately staff our factory in
Xinxing in the future. The inability to adequately staff our factories could have a material adverse impact on production, which
could lead to delays in shipments or missed sales. In the event that we have delayed or lost sales, we may need to deliver goods
by air at our cost to ensure that our products arrive on time, which would likely result in an increase in air freight costs and
vendor fines and could result in missed sales, any of which could have a material adverse effect upon our business and our results
from operations<FONT STYLE="color: red">. </FONT></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Recent
Changes In The PRC&rsquo;s Labor Law Could Penalize Bonso If It Needs To Make Additional Workforce Reductions</I>. In June 2007,
the National People&rsquo;s Congress of the PRC enacted new labor law legislation called the Labor Contract Law, which became
effective on January 1, 2008. It formalizes workers&rsquo; rights concerning overtime hours, pensions, layoffs, employment contracts
and the role of trade unions. Considered as one of the strictest labor laws in the world, among other things, this new law requires
an employer to conclude an &ldquo;open-ended employment contract&rdquo; with any employee who either has worked for the employer
for 10 years or more or has had two consecutive fixed-term contracts. An &ldquo;open-ended employment contract&rdquo; is in effect
a lifetime, permanent contract, which is terminable only in specified circumstances, such as a material breach of the employer&rsquo;s
rules and regulations, or for a serious dereliction of duty. Under the new law, downsizing by 20% or more of each individual entity
may occur only under specified circumstances, such as a restructuring undertaken pursuant to China&rsquo;s Enterprise Bankruptcy
Law, or where a company suffers serious difficulties in production and/or business operations. Also, if we lay off more than 20
employees at one time, we have to communicate with the labor union of our Company and report to the District Labor Bureau. During
the fiscal year ended March 31, 2014, we paid severance payments of $1,194,000 for reducing our full workforce in Shenzhen, PRC
as we moved our operations to the new factory in Xinxing, and the accumulated provision was approximately $256,000 as of March
31, 2015. (2014: $156,000; 2013: $743,000). This accrued severance payment allowance is reviewed every year. We may incur much
higher costs under China&rsquo;s labor laws if we are forced to downsize again, and accordingly, this new labor law may exacerbate
the adverse effect of the economic environment on our financial results and financial condition.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">17&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 17 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
Face Increasing Competition In Our Industry And May Not Be Able To Successfully Compete With Our Competitors. </I>Our business
is in an industry that is becoming increasingly competitive, and many of our competitors, both local and international, have substantially
greater technical, financial and marketing resources than we have. As a result, we may be unable to compete successfully with
these competitors. We compete with scale manufacturers in the Far East, the United States and Europe. We believe that our principal
competitors in the scale market are other original equipment manufacturers (&ldquo;OEMs&rdquo;) and original design manufacturers
(&ldquo;ODMs&rdquo;), and all companies engaged in the branded, ODM and OEM business. The scale market is highly competitive,
and we face pressures on pricing which could result in lower margins. Lower margins may affect our ability to cover our costs,
which could have a material negative impact on our operations and our business.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
Are Controlled By Our Management, Whose Interests May Differ From Those Of The Other Shareholders. </I>As of July 15, 2015, Mr.
Anthony So, our founder and Chairman, beneficially owned approximately 46.5% of our common stock (43.5% of our issued and outstanding
shares after eliminating 330,736 shares held as treasury stock (&ldquo;Treasury Stock&rdquo;)). Andrew So, our Chief Operating
Officer and President, beneficially owned approximately 12.8% of our common stock (8.6% of our issued and outstanding shares after
eliminating Treasury Stock). Albert So, our Chief Financial Officer, beneficially owned approximately 6.9% of our common stock
(4.8% of our issued and outstanding shares after eliminating Treasury Stock). The record ownership of Mr. Anthony So, Mr. Andrew
So and Mr. Albert So aggregates 56.9% of the shares entitled to vote. The other directors of the Company own of record 3.7% of
the shares entitled to vote. Accordingly, the existing management and directors of the Company can vote in the aggregate 60.6%
of the shares entitled to vote. As a result, the current directors and management of the Company are in a position to elect the
Board of Directors and, therefore, to control our business and affairs, including certain significant corporate actions such as
acquisitions, the sale or purchase of assets and the issuance and sale of our securities. The current directors and management
may be able to prevent or cause a change in control of the Company. We also may be prevented from entering into transactions that
could be beneficial to us without the current directors&rsquo; and management&rsquo;s consent. The interest of our largest shareholders
may differ from the interests of other shareholders. There are no agreements, understandings or commitments among the members
of the Board to vote their shares in any specific manner or to vote collectively for or against any matter that may come before
the shareholders.</FONT></P>



<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
have identified material weaknesses in our internal control over financial reporting which could, if not remediated, result in
material misstatements in our financial statements. </I>We are responsible for establishing and maintaining adequate internal
control over our financial reporting, as required by Rule&nbsp;13a-15 under the Securities Exchange Act of 1934. As disclosed
in Item&nbsp;15 &ndash; &ldquo;Controls and Procedures,&rdquo; we have identified, in conjunction with our independent auditors,
certain material weaknesses in our internal control over financial reporting related to our financial closing process, the lack
of trained accounting personnel and the failure to enter certain transactions into the accounting records on a timely basis.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">18</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 18 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">A
material weakness is defined as a deficiency, or combination of deficiencies, in internal control over financial reporting, such
that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be
prevented or detected on a timely basis. As a result of these material weaknesses, our management concluded that our internal
control over financial reporting was not effective as of March 31, 2015, based on criteria set forth by the 2013 Internal Control&mdash;Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. During the fiscal year ended March 31,
2015, the Company took remediation measures (as discussed in Item 15) to address certain deficiencies noted in our Form 20-F for
the fiscal year ended March 31, 2014.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
discussed in Item&nbsp;15, we are developing and intend to implement remediation plans designed to address these material weaknesses;
however, the material weaknesses will not be remediated until the necessary controls have been implemented and are determined
to be operating effectively. We do not know the specific time frame needed to fully remediate the material weaknesses identified.
We cannot assure you that our efforts to fully remediate these internal control weaknesses will be successful or that similar
material weaknesses will not recur. If our remedial measures are insufficient to address the material weaknesses, or if additional
material weaknesses or significant deficiencies in our internal control are discovered or occur in the future, our consolidated
financial statements may contain material misstatements and we could be required to restate our financial results.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Notwithstanding
the identified material weaknesses, management believes the consolidated financial statements included in this Annual Report on
Form 20-F fairly present in all material respects our financial condition, results of operations and cash flows at and for the
periods presented in accordance with U.S.&nbsp;GAAP.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Due
To Inherent Limitations, There Can Be No Assurance That Our System Of Disclosure And Internal Controls And Procedures Will Be
Successful In Preventing All Errors Or Fraud Or In Informing Management Of All Material Information In A Timely Manner.</I> Our
disclosure controls and internal controls and procedures may not prevent all errors and all fraud. A control system, no matter
how well-conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system
are met. Further, the design of a control system reflects that there are resource constraints, and the benefits of controls must
be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can
provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been or will be detected.
These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur
simply because of error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion
of two or more people or by circumvention of the internal control procedures. The design of any system of controls also is based
in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed
in achieving its stated goals under all potential future conditions; over time, a control may become inadequate because of changes
in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations
in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">19</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<!-- Field: Page; Sequence: 19 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>There
Are Inherent Uncertainties Involved In Estimates, Judgments And Assumptions Used In The Preparation Of Financial Statements In
Accordance With U.S. GAAP. Any Changes In Estimates, Judgments And Assumptions Could Have A Material Adverse Effect On Our Business,
Financial Position And Results Of Operations. </I>The consolidated financial statements included in the periodic reports we file
with the SEC are prepared in accordance with U.S. GAAP. The preparation of financial statements in accordance with U.S. GAAP involves
making estimates, judgments and assumptions that affect reported amounts of assets (including intangible assets), liabilities
and related reserves, revenues, expenses and income. Estimates, judgments and assumptions are inherently subject to changes in
the future, and any such changes could result in corresponding changes to the amounts of assets, liabilities, revenues, expenses
and income. Any such changes could have a material adverse effect on our financial position and results of operation.&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><I>Compliance
Costs With The Securities Laws The Sarbanes-Oxley Act of 2002 (&ldquo;Sarbanes-Oxley Act&rdquo;), The Wall Street Reform and Consumer
Protection Act (&ldquo;Dodd-Frank Act&rdquo;), And Other Regulatory Initiatives Will Increase Our Costs.</I> Changes in corporate
governance practices due to the Dodd-Frank Act and the Sarbanes-Oxley Act, changes in the continued listing rules of the NASDAQ
Stock Market, new accounting pronouncements and new regulatory legislation, rules or accounting changes have increased our cost
of being a U.S. public company and may have an adverse impact on our future financial position and operating results. </FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">.
<FONT STYLE="line-height: 107%">These regulatory changes and other legislative initiatives have made some activities more time-consuming
and have increased financial compliance and administrative costs for public companies, including foreign private issuers like
us. In addition, any future changes in regulatory legislation, rules or accounting may cause our legal and accounting costs to
further increase. In addition, these new rules and regulations require increasing time commitments and resource commitments from
our company, including from senior management. This increased cost could negatively impact our earnings and have a material adverse
effect on our financial position and results of operations. Further, the new rules may increase the expenses associated with our
director and officer liability insurance.</FONT></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>During
the Fiscal Year Ended March 31, 2014, We Inadvertently Violated Section 402 of the Sarbanes-Oxley Act and Section 13(k) Of The
Securities Exchange Act And May Be Subject To Sanctions For Such Violations.</I></FONT><I>&nbsp;</I></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Section
13(k) of the Securities Exchange Act of 1934, as amended (the &ldquo;Exchange Act&rdquo;) provides that it is unlawful for a company
such as ours, which has a class of securities registered under Section 12(b) of the Exchange Act to, directly or indirectly, including
through any subsidiary, extend or maintain credit in the form of a personal loan to or for any director or executive officer of
the company. Issuers violating Section 13(k) of the Exchange Act may be subject to civil sanctions, including injunctive remedies
and monetary penalties, as well as criminal sanctions. The imposition of any of such sanctions on the Company may have a material
adverse effect on our business, financial position, results of operations or cash flows.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">20</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 20 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal year ended March 31, 2014, we made loans aggregating approximately $1,052,000 to our Chairman and Chief Executive Officer
Anthony So. Management believed at the time that the loans were made that these loans were permissible and did not violate Section
13(k) of the Exchange Act, because Mr . Anthony<FONT STYLE="color: red"> </FONT>So would be able to repay the full amount by foregoing
his salary and accrued annual leave payments until the loans had been paid in full.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
advanced the funds to Mr. So on two separate occasions, and Mr. Anthony So directed that his salary payments and accrued
annual leave payments be used to offset the amounts that we loaned to him. In addition, Mr. Albert So and Mr. Andrew So, who
are officers and directors of the Company, directed the Company to use their accrued annual leave payments to partially
satisfy the amounts due to the Company from Mr. Anthony So. On March 31, 2014, the amount due to the Company from Mr. Anthony
So was $166,157. On August 7, 2014, Mr. Anthony So paid $166,157 to the Company to fully repay the amounts loaned to him. The
loans were non-interest bearing. See &ldquo;Major Shareholders and Related Party Transactions.&rdquo;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Notwithstanding
Mr., Anthony So&rsquo;s repayment in full of the loans made to him, those loans constitute a violation of Section 13(k) of the
Exchange Act and Section 402(a) of the Sarbanes-Oxley Act.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
a result of this inadvertent violation, the Board adopted a policy regarding loans or advances to any Executive Officer or Director
of the Company. The policy provides that &ldquo;The Company shall not directly or indirectly, including through any subsidiary,
extend or maintain credit to, or arrange for the extension of credit, or renew an extension of credit, in the form of a personal
loan to or for any Director or Executive Officer (or equivalent thereof) of the Company or any subsidiary of the Company.&rdquo;</FONT></P>

<P STYLE="font: 10pt/normal Arial Unicode MS,sans-serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Our
Operating Results And Stock Price Are Subject To Wide Fluctuations.</I> Our quarterly and annual operating results are affected
by a wide variety of factors that could materially and adversely affect net sales, gross profit and profitability. This could
result from any one or a combination of factors, many of which are beyond our control. Results of operations in any period should
not be considered indicative of results to be expected in any future period, and fluctuations in operating results may also result
in fluctuations in the market price of our common stock.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">21</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 21 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Our
Results Could Be Affected By Changes In Currency Exchange Rates.</I> Changes in currency rates involving the Hong Kong Dollar
or Chinese Renminbi could increase our expenses. During the fiscal years ended March 31, 2013, 2014 and 2015, our financial results
were affected by currency fluctuations, resulting in a total foreign exchange loss of approximately $261,000, $444,000 and $134,000,
respectively. Generally, our revenues are collected in United States Dollars. Our costs and expenses are paid in United States
Dollars, Hong Kong Dollars and Chinese Renminbi. We face a variety of risks associated with changes among the relative value of
these currencies. Appreciation of the Chinese Renminbi against the Hong Kong Dollar and the United States Dollar would increase
our expenses when translated into United States Dollars and could materially and adversely affect our margins and results of operations.
If the trend of Chinese Renminbi appreciation continues against the Hong Kong Dollar and the United States Dollar, our operating
costs will further increase and our financial results will be adversely affected. In addition, a significant devaluation in the
Chinese Renminbi or Hong Kong Dollar could have a material adverse effect upon our results of operations. If we determined to
pass onto our customers through price increases the effect of increases in the Chinese Renminbi relative to the Hong Kong Dollar
and the United States Dollar, it would make our products more expensive in global markets, such as the United States and the European
Union. This could result in the loss of customers, who may seek, and be able to obtain, products and services comparable to those
we offer in lower-cost regions of the world. If we did not increase our prices to pass on the effect of increases in the Chinese
Renminbi relative to the Hong Kong Dollar and the United States Dollar, our margins and profitability would suffer.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Protection
And Infringement Of Intellectual Property.</I> We have no patents, licenses, franchises, concessions or royalty agreements that
are material to our business. We have obtained a trademark registration in Hong Kong for the marks BONSO and MODUS in connection
with certain electronic apparatus. Unauthorized parties may attempt to copy aspects of our products or trademarks or to obtain
and use information that we regard as proprietary. Policing unauthorized use of our products is difficult. Our means of protecting
our proprietary rights may not be adequate. In addition, the laws of some foreign countries do not protect our proprietary rights
to as great an extent as do the laws of the United States. Our failure to adequately protect our proprietary rights may allow
third parties to duplicate our products or develop functionally equivalent or superior technology. In addition, our competitors
may independently develop similar technology or design around our proprietary intellectual property.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">22</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 22 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Further,
we may be notified that we are infringing patents, trademarks, copyrights or other intellectual property rights owned by other
parties. In the event of an infringement claim, we may be required to spend a significant amount of money to develop a non-infringing
alternative or to obtain licenses. We may not be successful in developing such an alternative or obtaining a license on reasonable
terms, if at all. Any litigation, even without merit, could result in substantial costs and diversion of resources and could have
a material adverse effect on our business and results of operations.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Cancellations
Or Delays In Orders Could Materially And Adversely Affect Our Gross Margins And Operating Income.</I> Sales to our OEM customers
are primarily based on purchase orders we receive from time to time rather than firm, long-term purchase commitments. Although
it is our general practice to purchase raw materials only upon receiving a purchase order, for certain customers we will occasionally
purchase raw materials based on such customers&rsquo; rolling forecasts. Further, during times of potential component shortages
we have purchased, and may continue to purchase, raw materials and component parts in the expectation of receiving purchase orders
for products that use these components. In the event actual purchase orders are delayed, are not received or are canceled, we
would experience increased inventory levels or possible write-downs of raw material inventory that could materially and adversely
affect our business and operating results.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
Generally Have No Written Agreements With Suppliers To Obtain Components, And Our Margins And Operating Results Could Suffer From
Increases In Component Prices.</I> We are typically responsible for purchasing components used in manufacturing products for our
customers. We generally do not have written agreements with our suppliers of components. This typically results in our bearing
the risk of component price increases because we may be unable to procure the required materials at a price level necessary to
generate anticipated margins from the orders of our customers. Prices of components may increase in the future for a variety of
reasons. Accordingly, additional increases in component prices could materially and adversely affect our gross margins and results
of operations.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
may encounter difficulties in obtaining approval to redevelop our Shenzhen Factory Land, which could adversely affect our growth
and business prospects.</I></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
part of our ongoing business strategy we intend to focus our efforts on redeveloping our Shenzhen factory into a high-end commercial
complex containing retail space, office space and some residential space. We anticipate that it will take several years to obtain
all necessary governmental approvals for us to redevelop the Shenzhen factory, and we think it is likely that we will obtain the
necessary approvals. However, there can be no assurance that we will be able to obtain all requisite permits and approvals from
relevant government authorities in relation to the redevelopment of the land, and the development of the commercial complex. Our
planned real estate project is subject to significant risks and uncertainties, including without limitation the following:</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">23</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"></P>

<!-- Field: Page; Sequence: 23 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 21pt"></TD><TD STYLE="width: 21pt">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">we
                                         do not currently have strong brand recognition or relationships in the real estate development
                                         and management business;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 21pt"></TD><TD STYLE="width: 21pt">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">we
                                         may not be able to obtain all necessary government approvals or all requisite permits
                                         and approvals from relevant government authorities in relation to the redevelopment of
                                         the land, or to successfully redevelop the land in a timely manner;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 21pt"></TD><TD STYLE="width: 21pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">we
                                         face intense competition from real estate developers that are already in the business
                                         for years;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 21pt"></TD><TD STYLE="width: 21pt">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">our
                                         experience and expertise gained from our manufacturing business may not be particularly
                                         relevant or applicable to a real estate development and management business; and</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/100% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 21pt"></TD><TD STYLE="width: 21pt">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">we
                                         may not be able to generate enough revenues to offset our costs in our real estate development
                                         and management business.</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt/100% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">If
we are not successful in development of our property development project, our growth, business, financial condition and results
of operations could be adversely affected.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
may not have adequate financing, whether through bank loans or other arrangements, to fund the redevelopment of our Shenzhen factory
site, and capital resources may not be available on commercially reasonable terms, or at all.</I></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Redevelopment
of our Shenzhen factory will require us to make a significant investment. Property development is capital intensive, and we do
not currently have the necessary capital to fund the redevelopment project. We plan to finance our property redevelopment from
our cash on hand, bank facilities and other sources. We cannot assure you that lenders will grant us sufficient financing in the
future to fully fund the redevelopment project or that funding will be available from other sources. Further, the financing policies
of the PRC government relating to the property development sector have varied. It is possible that the PRC government may further
tighten financing policies on PRC financial institutions for the property development sector. These property-related financing
policies may limit our ability and flexibility to use bank borrowings to finance our property redevelopment project.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">24</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 24 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
may fail to obtain, or experience material delays in obtaining, requisite certificates, licenses, permits or governmental approvals
for redevelopment of our Shenzhen factory, and as a result our redevelopment plans, business, results of operations and financial
condition may be materially and adversely affected.</I></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Property
development in the PRC is heavily regulated. Property developers in China must abide by various laws and regulations, including
implementation rules promulgated by local governments to enforce these laws and regulations. During various stages of our property
redevelopment project, we will be required to obtain and maintain various certificates, licenses, permits, certificates and governmental
approvals, including but not limited to qualification certificates, land use rights certificates, construction land planning permits,
construction works planning permits, construction works commencement permits, pre-sale permits and completion certificates. Before
the government authorities issue any certificate, license or permit, we must also meet specific conditions. We cannot assure you
that we will be able to adapt to new PRC land policies that may come into effect from time to time with respect to the property
development industry or that we will not encounter other material delays or difficulties in fulfilling the necessary conditions
to obtain all necessary certificates, licenses or permits for our property development in a timely manner, or at all, in the future.
If we fail to obtain or encounter significant delays in obtaining the necessary certificates, licenses or permits we will not
be able to continue with our redevelopment plans, and our business, results of operations and financial condition may be adversely
affected.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Certain
Legal Consequences of Foreign Incorporation and Operations</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Judgments
Against The Company And Management May Be Difficult To Obtain Or Enforce.</I> We are a holding corporation organized as an International
Business Company under the laws of the British Virgin Islands (&ldquo;BVI&rdquo;), and our principal operating subsidiaries are
organized under the laws of Hong Kong and the laws of the PRC. Our principal executive offices are located in Hong Kong and the
PRC. Outside the United States, it may be difficult for investors to enforce judgments obtained against us in actions brought
in the United States, including actions predicated upon the civil liability provisions of United States federal securities laws.
In addition, most of our officers and directors reside outside the United States, and the assets of these persons are located
outside the United States. As a result, it may not be possible for investors to effect service of process within the United States
upon these persons or to enforce against the Company or these persons judgments predicated upon the liability provisions of United
States federal securities laws. Our Hong Kong counsel and our British Virgin Islands counsel have advised that there is substantial
doubt as to the enforceability against us or any of our directors or officers in original actions or in actions for enforcement
of judgments of United States courts in claims for liability based on the civil liability provisions of United States federal
securities laws.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">25</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 25 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">No
treaty exists between Hong Kong or the British Virgin Islands and the United States providing for the reciprocal enforcement of
foreign judgments. However, the courts of Hong Kong and the British Virgin Islands are generally prepared to accept a foreign
judgment as evidence of a debt due. An action may then be commenced in Hong Kong or the British Virgin Islands for recovery of
this debt. A Hong Kong or British Virgin Islands court will only accept a foreign judgment as evidence of a debt due if:</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">the
                                         judgment is for a liquidated amount in a civil matter;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">the
                                         judgment is final and conclusive;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">the
                                         judgment is not, directly or indirectly, for the payment of foreign taxes, penalties,
                                         fines or charges of a like nature (in this regard, a Hong Kong court is unlikely to accept
                                         a judgment for an amount obtained by doubling, trebling or otherwise multiplying a sum
                                         assessed as compensation for the loss or damage sustained by the person in whose favor
                                         the judgment was given);</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">the
                                         judgment was not obtained by actual or constructive fraud or duress;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">the
                                         foreign court has taken jurisdiction on grounds that are recognized by the common law
                                         rules as to conflict of laws in Hong Kong or the British Virgin Islands;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">the
                                         proceedings in which the judgment was obtained were not contrary to natural justice (i.e.
                                         the concept of fair adjudication);</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">the
                                         proceedings in which the judgment was obtained, the judgment itself and the enforcement
                                         of the judgment are not contrary to the public policy of Hong Kong or the British Virgin
                                         Islands;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">the
                                         person against whom the judgment is given is subject to the jurisdiction of a foreign
                                         court; and</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">the
                                         judgment is not on a claim for contribution in respect of damages awarded by a judgment,
                                         which fall under Section&nbsp;7 of the Protection of Trading Interests Ordinance, Chapter
                                         7 of the Laws of Hong Kong.</FONT></TD></TR></TABLE>





<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Enforcement
of a foreign judgment in Hong Kong or the British Virgin Islands may also be limited or affected by applicable bankruptcy, insolvency,
liquidation, arrangement and moratorium, or similar laws relating to or affecting creditors&rsquo; rights generally, and will
be subject to a statutory limitation of time within which proceedings may be brought.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Because
We Are Incorporated In The British Virgin Islands, You May Not Have The Same Protections As Shareholders Of U.S. Corporations.
</I>We are organized under the laws of the British Virgin Islands. Principles of law relating to matters affecting the validity
of corporate procedures, the fiduciary duties of our management, directors and controlling shareholders and the rights of our
shareholders differ from, and may not be as protective of shareholders as, those that would apply if we were incorporated in a
jurisdiction within the United States. Our directors have the power to take certain actions without shareholder approval, including
amending our Memorandum or Articles of Association, which are the terms used in the British Virgin Islands for a corporation&rsquo;s
charter and bylaws, respectively, and approving certain fundamental corporate transactions, including reorganizations, certain
mergers or consolidations and the sale or transfer of assets. In addition, there is doubt that the courts of the British Virgin
Islands would enforce liabilities predicated upon United States federal securities laws.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">26</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 26 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Future
Issuances Of Preference Shares Could Materially And Adversely Affect The Holders Of Our Common Shares Or Delay Or Prevent A Change
Of Control. </I>Our Memorandum and Articles of Association provide the ability to issue an aggregate of 10,000,000 shares of preferred
stock in four classes. While no preferred shares are currently issued or outstanding, we may issue preferred shares in the future.
Future issuance of preferred shares could materially and adversely affect the rights of the holders of our common shares, dilute
the common shareholders&rsquo; holdings or delay or prevent a change of control.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Our
Shareholders Do Not Have The Same Protections Or Information Generally Available To Shareholders Of U.S. Corporations Because
The Reporting Requirements For Foreign Private Issuers Are More Limited Than Those Applicable To Public Corporations Organized
In The United States.</I> We are a foreign private issuer within the meaning of rules promulgated under the Securities Exchange
Act of 1934 (the &ldquo;Exchange Act&rdquo;). We are not subject to certain provisions of the Exchange Act applicable to United
States public companies, including: the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on
Form 10-Q or current reports on Form 8-K, the sections of the Exchange Act regulating the solicitation of proxies, consents or
authorizations with respect to a security registered under the Exchange Act and the sections of the Exchange Act requiring insiders
to file public reports of their stock ownership and trading activities and establishing insider liability for profits realized
from any &ldquo;short-swing&rdquo; trading transaction (i.e., a purchase and sale, or sale and purchase, of the issuer&rsquo;s
equity securities within six months or less). Because we are not subject to these rules, our shareholders are not afforded the
same protections or information generally available to investors in public companies organized in the United States.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Our
Board&rsquo;s Ability To Amend Our Charter Without Shareholder Approval Could Have Anti-Takeover Effects That Could Prevent A
Change In Control.</I> As permitted by the laws of the British Virgin Islands, our Memorandum and Articles of Association may
be amended by our Board of Directors without shareholder approval. This includes amendments to increase or reduce our authorized
capital stock. Our Board&rsquo;s ability to amend our charter documents without shareholder approval could have the effect of
delaying, deterring or preventing a change in control of Bonso, including a tender offer to purchase our common shares at a premium
over the current market price.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>We
Have Not Paid Dividends Since 2007 And May Not Pay Dividends In The Future.</I> We have not paid dividends on our common stock
since 2007, and we may not be able to declare dividends, or the Board of Directors may decide not to declare dividends, in the
future. We will determine the amounts of any dividends when and if they are declared, in the future at the time of declaration.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">27</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 27 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
4. Information on the Company</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>History
and Development of the Company</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Bonso
Electronics International Inc. was formed on August 8, 1988 as a limited liability International Business Company under the laws
of the British Virgin Islands under the name &ldquo;Golden Virtue Limited.&rdquo; On September 14, 1988, we changed our name to
Bonso Electronics International Inc. We operate under the BVI Business Companies Act.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
as of May 1, 2001 we acquired 100% of the equity of Korona Haushaltswaren GmbH &amp; Co. KG, a limited liability partnership registered
in Germany (&ldquo;Korona&rdquo;). Korona marketed consumer scale products throughout Europe to retail merchandisers and distributors.
Effective March 31, 2009, we sold certain assets of Korona to Beurer GmbH, including inventories, accounts receivable, toolings
and intellectual property rights. Korona completed its liquidation in February 2012.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
as of August 1, 2002, we acquired 51% of the equity of Gram Precision Scales Inc. (&ldquo;Gram Precision&rdquo;). Gram Precision
was primarily engaged in the distribution and marketing of pocket scales in the United States, Canada and Europe. Effective November
1, 2008, we sold our 51% of the equity of Gram Precision to Mohan Thadani, the founder of Gram Precision.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
April 2007, we formed a wholly-owned subsidiary, Bonso USA, Inc., a Nevada corporation (&quot;Bonso USA&quot;), to focus on the
sales of industrial scales in the U.S. market. Bonso USA has been dormant since 2009 and no business activities are being conducted
by this subsidiary.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">For
a description of our current operating subsidiaries, see &ldquo;Organizational Structure,&rdquo; below.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
corporate administrative matters are conducted through our registered agent, HWR Services Limited, P.O. Box 71, Road Town, Tortola,
British Virgin Islands. Our principal executive offices are located at Unit 1404, 14/F, Cheuk Nang Centre, 9 Hillwood Road, Tsimshatsui,
Kowloon, Hong Kong. Our telephone number is (852) 2605-5822, our facsimile number is (852) 2691-1724, our e-mail address is info@bonso.com
and our website is www.bonso.com.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">28</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 28 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Business
Overview</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Bonso
Electronics International Inc. designs, develops, produces and sells electronic sensor-based and wireless products for private
label original equipment manufacturers (individually &ldquo;OEM&rdquo; or, collectively, &ldquo;OEMs&rdquo;), original brand manufacturers
(individually &ldquo;OBM&rdquo; or, collectively, &ldquo;OBMs&rdquo;) and original design manufacturers (individually, &ldquo;ODM&rdquo;
or, collectively, &ldquo;ODMs&rdquo;).</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Since
1989, we have manufactured all of our products in China in order to take advantage of the lower overhead costs and competitive
labor rates. From 1989 until 2013, all of our production took place in our Shenzhen factory; however, during the fiscal year ended
March 31, 2013 we began production in our Xinxing factory. We moved all production processes from our Shenzhen factory to the
Xinxing factory during the fiscal year ended March 31, 2014, and we rented out the old Shenzhen factory to a third party as a
source of rental income.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
primary business has been the design, development, production and sale of electronic sensor-based and wireless products. Effective
with the transfer of manufacturing operations to our new factory in Xinxing we leased our factory in Shenzhen to a third party.
This lease marks our entry into the &ldquo;property&rdquo; business. The lease with the third party terminates in August 2019.
We intend to begin the process of seeking the necessary governmental approvals to permit us to redevelop the Shenzhen factory
into a high end commercial complex, containing retail space, office space and some residential space. If we are successful in
obtaining the necessary governmental approvals for the redevelopment, we believe that the rental income derived from leasing the
redeveloped property will be a significant contributing factor to our profit in the future.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
principal capital expenditures on property, plant and equipment over the last three years are set forth below:</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE ALIGN="CENTER" CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 9pt">
<tr style="vertical-align: top">
    <TD STYLE="width: 70%; border: Black 1pt solid; font: 12pt/115% Arial Unicode MS,sans-serif; padding: 5pt 5.4pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></td>
    <TD STYLE="width: 10%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; font: 12pt/115% Arial Unicode MS,sans-serif; padding: 5pt 5.4pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2013</FONT></td>
    <TD STYLE="width: 10%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; font: 12pt/115% Arial Unicode MS,sans-serif; padding: 5pt 5.4pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2014</FONT></td>
    <TD STYLE="width: 10%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; font: 12pt/115% Arial Unicode MS,sans-serif; padding: 5pt 5.4pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2015</FONT></td></tr>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; font: 12pt/115% Arial Unicode MS,sans-serif; padding: 5pt 5.4pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Property
    plant &amp; equipment and land use rights</FONT></td>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; font: 12pt/115% Arial Unicode MS,sans-serif; padding: 5pt 5.4pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$1,412,000</FONT></td>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; font: 12pt/115% Arial Unicode MS,sans-serif; padding: 5pt 5.4pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$2,898,000</FONT></td>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; font: 12pt/115% Arial Unicode MS,sans-serif; padding: 5pt 5.4pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$1,645,000</FONT></td></tr>
</table>
<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT>29</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 29 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
capital expenditures include construction-in-progress, leasehold improvement and the purchase of machinery used in the production
of certain of our products.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">All
of the foregoing capital expenditures were financed principally from internally generated funds, except for two motor vehicles
purchased with capital leases.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Products</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
sensor-based scale products include bathroom, kitchen, office, jewelry, laboratory, postal and industrial scales that are used
in consumer, commercial and industrial applications. These products accounted for 90% of revenue for the fiscal year ended March
31, 2013, 95% for 2014 and 89% for 2015. We believe that our sensor-based scale products will continue to be a major portion of
our scales revenue as we are able to secure orders from our major customers.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal year ended March 31, 2013, the Company began to produce certain electrical pet care products, including a bark control
device. These products accounted for 10% of revenue for the fiscal year ended March 31, 2015, 4% for 2014 and 8% for 2013.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
also receive revenue from certain customers for the development and manufacture of tooling and molding for scales and pet electronics
products although most of the tools and moulds which we produce are used by us for the manufacture of our products. We also generate
some sales of scrap materials. These revenues accounted for approximately 2% of net sales for the fiscal year ended March 31,
2013, 1% for 2014 and 1% for 2015.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table sets forth the percentage of net sales for each of the product lines mentioned above for the fiscal years ended
March 31, 2013, 2014, and 2015:</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="11" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Year ended March 31</B>,</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Product Line</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2013</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2014</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2015</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 46%; padding-left: 5.4pt">&nbsp;&nbsp;Scales</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">90</TD><TD STYLE="width: 1%; text-align: left">%</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">95</TD><TD STYLE="width: 1%; text-align: left">%</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">89</TD><TD STYLE="width: 1%; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">&nbsp;&nbsp;Pet Electronics Products</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10</TD><TD STYLE="text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 5.4pt">&nbsp;&nbsp;Others</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1</TD><TD STYLE="text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 5.4pt">&nbsp;&nbsp;Total</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">100</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">100</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">100</TD><TD STYLE="text-align: left">%</TD></TR>
</TABLE>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt/115% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">30</P>

<P STYLE="font: 10pt/115% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 30 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Business
Strategy</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
believe that our future growth depends upon our ability to eliminate or decrease the manufacture and sale of lower margin products,
strengthen our customer base by enhancing and diversifying our products, increasing the number of customers and expanding into
additional markets while maintaining or increasing sales of our products to existing customers, and focusing upon the production
and sale of higher margin products. Our future growth and our ability to become profitable are also dependent upon our ability
to control production costs and increase production capacity. Our strategy to achieve these goals is as follows:</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Increased
Focus Upon Manufacturing and Selling Higher Margin Products and the Elimination or Decrease in the Production and Sale of Lower
Margin Products. </I>In seeking to return to profitability, we analyzed our product mix and concluded that we were most likely
to return to profitability if we eliminated the production and sale of lower margin products that require the employment of larger
numbers of workers and the commitment of substantial resources to carry or stock raw materials and components inventory. We advised
our largest customer for these low margin electronic scale products that without substantial price increases, we would not be
in position to continue manufacturing these products in the calendar year beginning January 1, 2015. That customer did not agree
to the price increases that we requested, and has shifted this business to alternative suppliers. We are optimistic that this
will result in improved profitability for the Group.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Product
Enhancement And Diversification.</I> We continually seek to improve and enhance our existing products in order to provide a longer
product life-cycle and to meet increasing customer demands for additional features. Our research and development staff are currently
working on a variety of projects to enhance our existing scale products and in the postal scale/meter area. Further, we are developing
certain electrical pet care products. See &ldquo;Product Research and Development&rdquo; and &ldquo;Competition,&rdquo; below.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Maintaining
And Expanding Business Relations With Existing Customers.</I> We promote relationships with our significant customers through
regular communication, including visiting certain of our customers in their home countries and providing direct access to our
manufacturing and quality control personnel. This access, together with our concern for quality, has resulted in a relatively
low level of defective products. Moreover, we believe that our emphasis on timely delivery, good service and low cost has contributed,
and will continue to contribute, to good relations with our customers and increased orders. Further, we solicit suggestions from
our customers for product enhancement and when feasible, attempt to develop and incorporate the enhancements suggested by our
customers into our products.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">31</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 31 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Controlling
Production Costs</I>. In 1989, recognizing that labor cost was a major factor permitting effective competition in the consumer
electronic products industry, we relocated all of our manufacturing operations to China to take advantage of the large available
pool of lower-cost manufacturing labor. Continuing this approach and recognizing that labor costs are significantly lower in Xinxing
than in Shenzhen, we moved all of our manufacturing from Shenzhen to Xinxing, and there was a reduction in our labor costs as
a result. In addition, we have continued to shift production and manufacturing of various parts and components to third party
suppliers, including plastic injection molded parts and metal parts. In some cases, we have entered into agreements with third
parties in which they lease our equipment from us, and then manufacture parts and components that we use in assembling our final
products. Those third parties provide the workers and supervisors, and the necessary raw materials. We lease our machinery or
equipment, our dormitory facilities for their workers and supervisory staff and our meals or cafeteria services for the third
party&rsquo;s workers and staff. There are other third party contractors that utilize their own equipment and their own facilities
in manufacturing specific components or parts for us.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
are actively seeking to control production costs by such means as redesigning our existing products in order to decrease material
and labor costs, controlling the number of our employees, increasing the efficiency of workers by providing regular training and
tools and redesigning the flow of our production lines.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>New
Manufacturing Facility</I>. In November 2006, Bonso entered into a land purchase agreement to acquire 133,500 square meters of
land use right for future expansion in Xinxing, China. We have completed construction of the new manufacturing facility and moved
all manufacturing operations from Shenzhen to Xinxing. The office building on the Xinxing site was completed in February 2015,
and we expect to complete leasehold renovations by December 2015. We intend to carefully monitor our capacity needs and to expand
capacity as necessary in the future.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Customers
and Marketing</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
sell our products primarily in the United States and Europe. Customers for our products are primarily OEMs, OBMs and ODMs which
market the products under their own brand names. We market our products to OEMs, OBMs and ODMs through our sales staff at trade
shows and via e-mail, our website and facsimile.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Net
export sales to customers by geographic area constituting 10% or more of total sales of the Company consisted of the following
for each of the three years ended March 31, 2013, 2014 and 2015.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center">32</P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 32 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Year
ended March 31:</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2013</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2014</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2015</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid">$ in thousands</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid">%</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid">$ in thousands</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid">%</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid">$ in thousands</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 28%; text-align: left; padding-left: 5.4pt">United States of America</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">23,804</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">78</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">25,203</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">81</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">21,271</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">73</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 5.4pt">Germany</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,121</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,688</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,210</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 5.4pt">Total</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">28,925</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">95</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">29,891</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">96</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27,481</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">95</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
maintain a marketing and sales team of five people. Also, our experienced engineering teams work directly with our customers to
develop and tailor our products to meet the customers&rsquo; specific needs. We market our products primarily through a combination
of direct contact by our experienced in-house technical sales staff and through trade shows and via e-mail, our website and facsimile.
No commission payments were paid to the sales team during the fiscal years ended March 31, 2013, 2014 and 2015.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
major sensor-based electronic scale products and pet electronic products customers and their percentage of sales for the prior
three fiscal years are below:</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0 0 6pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Percent
of Sales &ndash; Year ended March 31:</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Customers</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2013</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2014</TD><TD STYLE="font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 46%; text-align: left; padding-left: 5.4pt">Sunbeam Products, Inc.</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">52</TD><TD STYLE="width: 1%; text-align: left">%</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">45</TD><TD STYLE="width: 1%; text-align: left">%</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">24</TD><TD STYLE="width: 1%; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Fitbit, Inc.</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">18</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">33</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">37</TD><TD STYLE="text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Kern + Sohn GMBH</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">19</TD><TD STYLE="text-align: left">%</TD></TR>
</TABLE>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Component
Parts and Suppliers</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
purchase over 1,000 different component parts from more than 100 major suppliers and are not dependent upon any single supplier
for key components. We purchase components for our products primarily from suppliers in Japan, Taiwan, Hong Kong and China.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">33</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 33 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
price of oil and other raw materials increased during the fiscal years ended March 31, 2011 and 2012 resulting in an increase
of our component part prices. We have taken steps to reduce our exposure to any inability to obtain components by forecasting
with an increased buffer rate and placing orders for components earlier and allowing for longer delivery lead times. Because of
these actions, we do not expect to experience any difficulty in obtaining needed component parts for our products. The price level
of raw materials remained stable in the fiscal year ended March 31, 2014, compared to that in the fiscal year ended March 31,
2013 and decreased slightly in the fiscal year ended March 31, 2015 compared to that in the fiscal year ended March 31, 2014.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Quality
Control</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have received ISO 9001:2008 certification from BSI Assurance UK Limited. The ISO 9001:2008 certification was awarded to our subsidiary,
Bonso Advanced Technology (Xinxing) Company Limited. ISO 9001 is one of the ISO 9000 series of quality system standards developed
by the International Organization for Standardization, a worldwide federation of national standards bodies. ISO 9001 provides
a model for quality assurance (and continuous improvement) in product development, manufacturing, installation and servicing that
focuses on meeting customer requirements.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
European Union has enacted the Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Directive
(&ldquo;RoHS&rdquo;). RoHS prohibits the use of certain substances, including lead, in certain products. We believe that we are
in compliance with RoHS and have a supply of compliant components from suppliers.</FONT>&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company provides to certain customers an additional one to two percent of certain products ordered in lieu of a warranty, which
are recognized as cost of sales when these products are shipped to customers from our facility. In addition, certain products
sold by the Company are subject to a limited product quality warranty. The Company accrues for estimated incurred but unidentified
quality issues based upon historical activity and known quality issues if a loss is probable and can be reasonably estimated.
The standard limited warranty period is one to three years. Quality returns, refunds, rebates and discounts are recorded net of
sales if they are within the warranty period. All sales are based upon firm orders with fixed terms and conditions, which generally
cannot be modified. Historically, we have not experienced material differences between our estimated amounts of quality returns,
refunds, rebates and discounts and the actual results. Our contracts do not contain price protection or similar privileges in
relation to the sale of goods.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">34</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 34 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Patents,
Licenses, Trademarks, Franchises, Concessions and Royalty Agreements</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have obtained a trademark registration in Hong Kong and China for the marks BONSO and MODUS in connection with certain electronic
apparatus.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
rely on a combination of patent, trademark and trade secret laws, employee and third party non-disclosure agreements and other
intellectual property protection methods to protect our proprietary rights. There can be no assurance that third parties will
not assert infringement or other claims against us with respect to any existing or future products. We cannot assure you that
licenses would be available if any of our technology were successfully challenged by a third party, or if it became desirable
to use any third-party technology to enhance the Company&rsquo;s products. Litigation to protect our proprietary information or
to determine the validity of any third-party claims could result in a significant expense to us and divert the efforts of our
technical and management personnel, whether or not such litigation is determined in our favor.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">While
we have no knowledge that we are infringing upon the proprietary rights of any third party, there can be no assurance that such
claims will not be asserted in the future with respect to existing or future products. Any such assertion by a third party could
require us to pay royalties, to participate in costly litigation and defend licensees in any such suit pursuant to indemnification
agreements or to refrain from selling an alleged infringing product or service.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Product
Research and Development</B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
major responsibility of the product design, research and development personnel is to develop and produce designs to the satisfaction
of, and in accordance with, the specifications provided by the OEMs, OBMs and ODMs. We believe our engineering and product development
capabilities are important to the future success of our business. As an ODM, we take specifications that are provided to us by
the customer and design a product to meet those specifications. Some of our product design, research and development activities
are customer funded and are under agreements with specific customers for specific products. To reduce costs, we conduct our research
and development at our facilities in China. We principally employ Chinese engineers and technicians at costs that are substantially
lower than those that would be required in Hong Kong. At March 31, 2015, we employed 14 individuals in Hong Kong and China for
our engineering staff, who are at various times engaged in research and development.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">35</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 35 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Competition</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
manufacture and sale of electronic sensor-based and wireless products is highly competitive. Competition is primarily based upon
unit price, product quality, reliability, product features and management&rsquo;s reputation for integrity. Accordingly, reliance
is placed on research and development of new products, line extensions and technological, quality and other continuous product
improvement. There can be no assurance that we will enjoy the same degree of success in these efforts in the future. Research
and development expenses aggregated approximately $396,000, $366,000 and $228,000 during the fiscal years ended March 31, 2013,
2014 and 2015, respectively.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>


<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Seasonality</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Generally,
the first calendar quarter of each year is typically the slowest sales period because our manufacturing facilities in China are
closed for two weeks for the Chinese New Year holidays to permit employees to travel to their homes in China. In addition, sales
during the first calendar quarter of scales products usually dip following the increase in sales during the Christmas season.
A greater number of our sales of scales products occur between the months of July and October for shipment in preparation for
the Christmas holiday. Throughout the remainder of the year, our products do not appear to be subject to significant seasonal
variation. However, past sales patterns may not be indicative of future performance.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Transportation</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Typically,
we sell products either F.O.B. Hong Kong, Yantian (Shenzhen) or Nansha (Guangzhou), which means that our customers are responsible
for the transportation of finished products from Hong Kong, Yantian (Shenzhen) or Nansha (Guangzhou) to their final destination.
Transportation of components and finished products to and from the point of shipment is by truck. To date, we have not been materially
affected by any transportation problems. However, transportation difficulties affecting air cargo or shipping, such as an extended
closure of ports that materially disrupts the flow of our customers&rsquo; products to their destination, mainly the United States
and Europe, could materially and adversely affect our sales and margins if, as a result, our customers delay or cancel orders
or seek concessions to offset expediting charges they incurred pending resolution of the problems causing the port closures.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Government
Regulation</B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
are subject to comprehensive and changing foreign, federal, provincial, state and local environmental requirements, including
those governing discharges into the air and water, the handling and disposal of solid and hazardous waste and the remediation
of contamination associated with releases of hazardous substances. We believe that we are in compliance with current environmental
requirements. Nevertheless, we use hazardous substances in our operations and, as is the case with manufacturers in general, if
a release of hazardous substances occurs on or from our properties we may be held liable and may be required to pay the cost of
remediation. The amount of any resulting liability could be material.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">36</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<!-- Field: Page; Sequence: 36 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Foreign
Operations</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
products are manufactured at our factories located in China. While China has been granted permanent most favored nation trade
status in the United States through its entry into the World Trade Organization, controversies between the United States and China
may arise that threaten the status quo involving trade between the United States and China. These controversies could materially
and adversely affect our business by, among other things, causing our products in the United States to become more expensive,
resulting in a reduction in the demand for our products by customers in the United States.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Sovereignty
over Hong Kong reverted to China on July 1, 1997. The 1984 Sino-British Joint Declaration, the 1990 Basic Law of Hong Kong, the
1992 United States-Hong Kong Policy Act and other agreements provide some indication of the business climate we believe will continue
to exist in Hong Kong. Hong Kong remains a Special Administrative Region (&ldquo;SAR&rdquo;) of China, with certain autonomies
from the Chinese government. Hong Kong is a full member of the World Trade Organization. It has separate customs territory from
China, with separate tariff rates and export control procedures. It has a separate intellectual property registration system.
The Hong Kong Dollar is legal tender in the SAR, freely convertible and not subject to foreign currency exchange controls by China.
The SAR government has sole responsibility for tax policies, though the Chinese government must approve the SAR&rsquo;s budgets.
Notwithstanding the provisions of these international agreements, we cannot be assured of the continued stability of political,
legal, economic or other conditions in Hong Kong. No treaty exists between Hong Kong and the United States providing for the reciprocal
enforcement of foreign judgments. Accordingly, Hong Kong courts might not enforce judgments predicated on the federal securities
laws of the United States, whether arising from actions brought in the United States or, if permitted, in Hong Kong.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">37</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 37 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Organizational
Structure</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><B></B><IMG SRC="image_001.jpg" ALT=""></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have two wholly-owned Hong Kong subsidiaries, Bonso Electronics Limited (&ldquo;BEL&rdquo;) and Bonso Advanced Technology Limited
(&ldquo;BATL&rdquo;). Both BEL and BATL were organized under the laws of Hong Kong and are responsible for the design, development,
manufacture and sale of our products.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">BEL
has one active Hong Kong subsidiary, Bonso Investment Limited (&ldquo;BIL&rdquo;). BIL was organized under the laws of Hong Kong
and has been used to acquire and hold our investment properties in Hong Kong and China.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">BEL
also has one active PRC subsidiary, Bonso Electronics (Shenzhen) Company, Limited (&ldquo;BESCL&rdquo;), which is organized under
the laws of the PRC and was used to manufacture our products until January 2014. BESCL leased its factory to a third party from
August 2013 to August 2019, and is receiving a monthly rental income of approximately $104,000 until August 2016, which will increase
to approximately $114,000 from August 2016 to August 2019. Effective with the transfer of manufacturing operations to Xinxing,
we ceased manufacturing in this subsidiary and its principal business today is leasing our former manufacturing facility to a
third party.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">BATL
has three active PRC subsidiaries, Bonso Advanced Technology (Xinxing) Company, Limited (&ldquo;BATXXCL&rdquo;), which is organized
under the laws of the PRC and is used to acquire and hold our new manufacturing facility in Xinxing, Guangdong, China, Xinxing
An Bang Metal and Plastic Manufacturing Company Limited (&ldquo;ANB&rdquo;), in Xinxing, Guangdong, PRC, for hiring workers for
assembly of scales and pet electronics products, and Bonso Technology (Shenzhen) Company Limited (&ldquo;BTL&rdquo;), in Shenzhen,
PRC, to provide product design and distribution services for the Group.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">38</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<!-- Field: Page; Sequence: 38 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
also have a wholly-owned British Virgin Islands subsidiary, Modus Enterprise International Inc. (&ldquo;Modus&rdquo;), which owned
100% of Korona until Korona&rsquo;s liquidation during the fiscal year ended March 31, 2012 and which owns 100% of Bonso USA,
which has been dormant since 2009 and does not conduct any business activities. (See &ldquo;History and Development of the Company,&rdquo;
above.)</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Property,
Plant and Equipment</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>British
Virgin Islands</B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
corporate administrative offices are located at Cragmuir Chambers, Road Town, Tortola, British Virgin Islands and corporate administrative
matters are conducted through our registered agent, HWR Services Limited, located at P.O. Box 71, Road Town, Tortola, British
Virgin Islands.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Hong
Kong</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
own a residential property in Hong Kong, which is located at Savanna Garden, House No. 27, Tai Po, New Territories, Hong Kong.
House No. 27 consists of approximately 2,475 square feet plus a 177 square foot terrace and a 2,308 square foot garden area. The
use of House No. 27 is provided as quarters to Mr. Anthony So, the Chairman and Chief Executive Officer of the Company.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>China</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
Shenzhen factory in China is located at Shenzhen in the DaYang Synthetical Development District, close to the border between Hong
Kong and China. This factory consists of one factory building, which contains approximately 186,000 square feet, two workers&rsquo;
dormitories, containing approximately 103,000 square feet, a canteen and recreation center of approximately 26,000 square feet,
an office building, consisting of approximately 26,000 square feet, and two staff quarters for our supervisory employees, consisting
of approximately 34,000 square feet, for a total of approximately 375,000 square feet. The Group entered into a rental agreement
in June 2013 to rent out the Shenzhen factory to a third party from August 2013 to August 2019. We receive a monthly rental income
of approximately $104,000 until August 2016, which will increase to approximately $114,000 from August 2016 to August 2019.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">39</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 39 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
intend to begin the process of seeking the necessary governmental approvals to permit us to redevelop the Shenzhen factory into
a high end commercial complex, containing retail space, office space and some residential space. If we are successful in obtaining
the necessary governmental approvals for the redevelopment, we believe that the rental income derived from leasing the redeveloped
property will be a significant contributing factor to our profit in the future.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
also own one residential property in Shenzhen, which is located at Lakeview Mansion, B-20C, Hujinju Building No. 63, Xinan Road,
Boacheng Baoan Shenzhen, China. It consists of approximately 1,591 square feet and is rented to an unaffiliated third party for
an aggregate monthly rental of RMB 4,500, or approximately $731.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
addition, we own two office units in Beijing, namely Units 12 and 13 on the third floor, Block A of Sunshine Plaza in Beijing,
China. Unit 12 consists of 1,102 square feet and Unit 13 consists of 1,860 square feet. One unit is rented to an unaffiliated
third party for an aggregate monthly rental of approximately RMB 11,424, or approximately $1,856, while the other unit is rented
to another unaffiliated third party for an aggregate monthly rental of approximately RMB 8,000 or approximately $1,299.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
Xinxing factory is located in Xinxing High-Tech Industrial Estate, Xinxing, Yunfu City, Guangdong, China. This factory land area
is 1,448,000 square feet, with one factory building consisting of 225,000 square feet, one warehouse consisting of 62,000 square
feet, three dormitories consisting of an aggregate of 85,000 square feet and an office building consisting of 49,000 square feet.
Leasehold improvements being made to the office building are expected to be completed by December 2015.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On July 10, 2015, the Company entered into an agreement with a third party to sell part of the Company&rsquo;s land use right
in Xinxing, PRC for approximately $866,000. The area of this piece of land is approximately 18% of the total land area of our
Xinxing manufacturing facility. The selling price is approximately 86% more than our initial purchase price, and the resulting
gain will be determined upon final measurement by the local Land Department and the taxation will be determined by the local tax
authorities. This piece of land includes part of the land use rights currently arranged as securities to a bank for the banking
facilities arrangement. The Company is working with the bank in order to release part of the land use right to the buyer.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">40</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><BR>
<BR></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<!-- Field: Page; Sequence: 40 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Adequacy
of Facilities</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
believe our manufacturing complex will be adequate for our reasonably foreseeable needs.</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>


<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">I<B>tem
4A. Unresolved Staff Comments<FONT STYLE="font-style: normal; font-variant: normal">Not Applicable to Bonso.</FONT></B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin: 0 0 0 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT>Not
Applicable to Bonso</P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
5. Operating and Financial Review and Prospects</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following discussion and analysis should be read in conjunction with Item 3. &ndash; &ldquo;Key Information &ndash; Selected Financial
Data&rdquo; and the Consolidated Financial Statements and Notes to Consolidated Financial Statements included elsewhere in this
Annual Report.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Overview</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal year ended March 31, 2015, the Company experienced decreased revenues. Our overall sales decreased due to our discontinuation
of manufacturing and sales of certain lower margin products.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
derive our revenues principally from the sale of sensor-based scales manufactured in China, which represent 89% of total sales
for the fiscal year ended March 31, 2015. As mentioned in Item 3. &ndash; &ldquo;Key Information &ndash; Risk Factors,&rdquo;
we are dependent upon a limited number of major customers for a significant portion of our revenues. Our revenues and business
operation are subject to fluctuation if there is a loss of orders from any of our largest customers. Further, the pricing of our
scale products is becoming increasingly competitive, especially to our customers in the United States and Germany, who contributed
approximately 95% of our revenue during the fiscal year ended March 31, 2015.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Net
sales from continuing operations, income (loss) from operations and net (loss) / income were approximately $30,386,000, ($403,000)
and ($754,000), respectively, for the fiscal year ended March 31, 2013, $31,305,000, $295,000, and ($221,000), respectively, for
the fiscal year ended March 31, 2014 and $28,944,000, $462,000, and $1,110,000, respectively, for the fiscal year ended March
31, 2015.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">41</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT>&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<!-- Field: Page; Sequence: 41 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Labor
costs per worker are increasing in China. In accordance with the new minimum wage set by the local authorities, we increased the
minimum wage for our labor in Shenzhen, PRC from RMB 1,320 (or approximately $206) per month beginning April 1, 2011, to RMB 1,500
(or approximately $238) per month beginning February 1, 2012, and then to RMB 1,600 (or approximately $254) per month beginning
March 1, 2013, and then to RMB 1,808 (or approximately $293) per month beginning February 1, 2014 in Shenzhen, PRC. The minimum
wage was RMB 1,010 (or approximately $164) per month in Xinxing, Guangdong, PRC beginning May 1, 2013 and is currently RMB 1,210
(or approximately $197). We believe that future increase in labor costs in China will have a significant effect on our total production
costs and results of operations. Our labor costs represented approximately 11.8% of our total production costs in the fiscal year
ended March 31, 2015, compared to 14.5% in the fiscal year ended March 31, 2014 and 15.8% in 2013. Total labor costs decreased
from approximately $4,151,000 in the fiscal year ended March 31, 2014, to approximately $2,715,000 in the fiscal year ended March
31, 2015. The decrease in overall labor costs was the result of the strategic decrease in the number of workers due to a decrease
in orders. There can be no assurance that labor costs will not increase in the future or that any additional increase in labor
costs will not have a material adverse effect upon our results of operations.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have continued to shift production and manufacturing of various parts and components to third party suppliers, including plastic
injection molded parts and metal parts. In some cases, we have entered into agreements with third parties in which they lease
our equipment from us, and then manufacture parts and components that we use in assembling our final products. Those third parties
provide the workers and supervisors, and the necessary raw materials. We lease our machinery or equipment, our dormitory facilities
for their workers and supervisory staff, and our meals or cafeteria services for the third party&rsquo;s workers and staff. There
are other third party contractors that utilize their own equipment and their own facilities in manufacturing specific components
or parts for us.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have not experienced significant difficulties in obtaining raw materials for our products, and management does not anticipate
any such difficulties in the foreseeable future. Prices of raw materials increased during the fiscal year ended March 31, 2011,
but did not vary significantly during the fiscal years ended March 31, 2012, 2013 and 2014. The price of some of the raw materials
utilized by the Company fluctuates directly with the price of oil, and the price of raw materials decreased slightly in the fiscal
year ended March 31, 2015, compared to that in the fiscal year ended March 31, 2014. There can be no assurance that raw material
costs will not fluctuate or that any additional increase in raw material costs will not have a material adverse effect upon our
results of operations.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
seeking to return to profitability, we analyzed our product mix and concluded that we were most likely to return to profitability
if we eliminated the production and sale of lower margin products that require the employment of larger numbers of workers and
the commitment of substantial resources to carry or stock raw materials and components inventory. We advised our largest customer
for these low margin electronic scale products that without substantial price increases we would not be in a position to continue
manufacturing these products in the calendar year beginning January 1, 2015. That customer did not agree to the price increases
that we requested, and has shifted this business to alternative suppliers. We are optimistic that this will result in improved
profitability for the Group.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">42</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 42 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Operating
Results</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table sets forth selected income data as a percentage of net sales for the periods indicated:</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="11" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><B>Fiscal Year Ended March 31,</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Statement of Operations Data</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><B>2013</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif"><B>2014</B></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt/115% Times New Roman, Times, Serif"><B>2015</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-bottom: 1pt; padding-left: 5.4pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">%</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">%</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt/115% Times New Roman, Times, Serif">%</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 46%; text-align: justify; padding-left: 5.4pt">Net sales</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">100.0</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">100.0</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">100.0</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Cost of sales</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(83.1</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(91.5</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(79.8</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Gross profit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">16.9</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8.5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20.2</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Rental income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.1</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2.2</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5.0</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Selling expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.9</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1.2</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2.8</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Salaries and related costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(8.6</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(9.5</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(10.9</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Research and development expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1.3</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1.2</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.8</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Administration and general expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(7.9</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(9.5</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(11.2</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Other income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.4</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.1</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1.8</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Gain on disposal of property, plant and equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.0</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11.5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.3</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">(Loss) / income from operations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1.3</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.9</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1.6</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Interest income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.0</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.2</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.1</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Interest expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.2</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.4</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1.0</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Foreign exchange loss</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.9</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1.4</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.5</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">(Loss) / income before income taxes</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2.4</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.7</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.2</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Income tax (expense) / credit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.1</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.0</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3.6</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-left: 5.4pt">Net (loss) / income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2.5</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(0.7</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3.8</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Fiscal
year ended March 31, 2015 compared to fiscal year ended March 31, 2014</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Net
Sales</I>. Our sales decreased approximately $2,361,000, or 7.5%, from approximately $31,305,000 for the fiscal year ended March
31, 2014 to approximately $28,944,000 for the fiscal year ended March 31, 2015. The decrease in sales was primarily due to our
strategic decision to give up orders of certain lower margin electronic scale products.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">43</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 43 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Gross
Profit</I>. Gross profit as a percentage of revenue increased to approximately 20.2% during the fiscal year ended March 31, 2015,
as compared to approximately 8.5% during the fiscal year ended March 31, 2014. The higher gross margin was primarily the result
of a higher percentage of sales being of higher margin products.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Rental
Income. </I>Rental income increased approximately $745,000 or 105.2%, from approximately $708,000 for the fiscal year ended March
31, 2014 to approximately $1,453,000 for the fiscal year ended March 31, 2015. The increase was primarily the result of a full
year of rental income generated from the Shenzhen factory during the fiscal year ended March 31, 2015, as compared to partial
rental income generated since August 1, 2013 from the Shenzhen factory during the fiscal year ended March 31, 2014.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Selling
Expenses</I>. Selling expenses increased by approximately $433,000, or 111.3%, from approximately $389,000 for the fiscal year
ended March 31, 2014 to approximately $822,000 for the fiscal year ended March 31, 2015. The increase was the result of air freight
costs incurred due to a delay in production of certain orders of lower margin electronic scale products.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Salaries
And Related Costs</I>. Salaries and related costs increased by approximately $183,000, or 6.1%, from approximately $2,983,000
for the fiscal year ended March 31, 2014 to approximately $3,166,000 for the fiscal year ended March 31, 2015. The increase in
salaries and related costs was primarily the result of an increase in employee insurance and pension expenses for the fiscal year
ended March 31, 2015.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Research
And Development</I>. Research and development expenses decreased approximately $138,000, or 37.7%, from approximately $366,000
for the fiscal year ended March 31, 2014 to approximately $228,000 for the fiscal year ended March 31, 2015. The decrease in research
and development was primarily the result of a reduction in engineers for lower margin electronic scale products. Research and
development expenses account for 0.8% of net revenue for the fiscal year ended March 31, 2015, and for 1.2% of net revenue for
the fiscal year ended March 31, 2014.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Administration
And General Expenses.</I> Administration and general expenses increased by approximately $281,000, or 9.5%,
from approximately $2,964,000 for the fiscal year ended March 31, 2014 to approximately $3,245,000 for the fiscal year ended
March 31, 2015. The increase was primarily attributable to an increase in depreciation and local tax payments for the fiscal
year ended March 31, 2015.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">44</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 44 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Other
Income. </I>Other income increased approximately $500,000 or 2,500.0%, from approximately $20,000 for the fiscal year
ended March 31, 2014 to approximately $520,000 for the fiscal year ended March 31, 2015. The increase was primarily the result
of an increase of $131,000 gain on valuation of forward contracts and an increase of $194,000 for the reduction of aged accounts
payable for the fiscal year ended March 31, 2015.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Gain
on Disposal of Property, Plant and Equipment</I>. Gain on disposal of property, plant and equipment decreased approximately $3,497,000,
or 97.3%, from $3,595,000 for the fiscal year ended March 31, 2014 to approximately $98,000 for the fiscal year ended March 31,
2015. The gain of $3,595,000 for the disposal of property, plant and equipment for the fiscal year ended March 31, 2014 was related
to the Shenzhen factory, and was recorded when we transferred all production processes to the Xinxing factory and leased out the
Shenzhen factory for rental income. However, no such large gain on disposal of property, plant and equipment was realized during
the fiscal year ended March 31, 2015.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Income
From Operations</I>. As a result of the factors described above, income from operations increased by 56.6% from a profit of approximately
$295,000 for the fiscal year ended March 31, 2014 to a profit of approximately $462,000 for the fiscal year ended March 31, 2015.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Interest
Income</I>. Interest income decreased to approximately $18,000 for the fiscal year ended March 31, 2015, as compared to approximately
$64,000 for the fiscal year ended March 31, 2014, due to lower interest rates on saving accounts and fixed deposit accounts. During
the fiscal year ended March 31, 2014, the Company earned 6% per annum, or approximately $62,000, from a fixed deposit in RMB with
the interest rate pegged to the appreciation rate of RMB against USD. During the fiscal year ended March 31, 2015, the Company
earned 0.25% per annum, or approximately $3,000, from a similar fixed deposit in RMB for which the interest rate was pegged to
the appreciation rate of RMB against USD.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Interest
Expense</I>. Interest expense increased approximately $137,000, or 100.7%, from approximately $136,000 for the fiscal year ended
March 31, 2014 to approximately $273,000 for the fiscal year ended March 31, 2015. This increase was primarily the result of an
increase in bank borrowings obtained in the PRC with higher interest rates.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Foreign
Exchange Loss. </I>Foreign exchange loss decreased approximately $310,000, or 69.8%, from approximately $444,000 for the fiscal
year ended March 31, 2014 to approximately $134,000 for the fiscal year ended March 31, 2015. This decrease was primarily the
result of decrease in magnitude of the appreciation of Chinese Yuan against the United States Dollars during the fiscal year ended
March 31, 2015.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">45</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"></P>

<!-- Field: Page; Sequence: 45 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 35.45pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Income
Tax (Expense) / Credit</I>. Income tax credit was approximately $1,037,000 during the fiscal year ended March 31, 2015, as compared
to $nil during the fiscal year ended March 31, 2014. The increase in income tax credit was the result of the reversal of over-provision
of the prior years&rsquo; uncertain income tax liability. The tax review was concluded and confirmed with local tax authorities
during the fiscal year ended March 31, 2015.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Net
(Loss) / Income</I>. As a result of the factors described above, net income increased from a loss of approximately $221,000 for
the fiscal year ended March 31, 2014 to income of approximately $1,110,000 for the fiscal year ended March 31, 2015, an increase
in income of approximately $1,331,000, or 602.3%.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Foreign
Currency Translation Adjustments.</I> Foreign currency translation adjustments, net of tax, decreased from approximately $257,000
for the fiscal year ended March 31, 2014 to approximately $123,000 for the fiscal year ended March 31, 2015, a decrease of approximately
$134,000, or 52.1%. The decreased foreign currency translation adjustment, net of tax, was primarily the result of reduced fluctuation
of the Chinese Renminbi against the United States Dollar.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Comprehensive
(Loss) / Income. </I> As a result of the factors described above, comprehensive gain increased from an income of approximately
$36,000 for the fiscal year ended March 31, 2014 to an income of approximately $1,233,000 for the fiscal year ended March 31,
2015, an increase of approximately $1,197,000 or 3,325%.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Fiscal
year ended March 31, 2014 compared to fiscal year ended March 31, 2013</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 58.3pt 0 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Net
Sales</I>. Our sales increased approximately $919,000, or 3.0%, from approximately $30,386,000 for the fiscal year ended March
31, 2013 to approximately $31,305,000 for the fiscal year ended March 31, 2014. The increase in sales was primarily due to an
increased demand for our electronic scales products.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Gross
Profit</I>. Gross profit as a percentage of revenue decreased to approximately 8.5% during the fiscal year ended March 31, 2014,
as compared to approximately 16.9% during the fiscal year ended March 31, 2013. The lower gross margin was primarily the result
of the increased labor costs due to termination of all direct labor in our Shenzhen factory during the transfer of production
processes to our Xinxing factory, and for an increase in subcontracting costs for subcontracting work to third parties during
our loss of production capacity during the transfer. In addition, we incurred approximately $307,000 more in carriage inward during
the fiscal year ended March 31, 2014 for the transfer of production processes to the Xinxing factory.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">46</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 46 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Rental
Income. </I>Rental income increased approximately $663,000 or 1,473.3%, from approximately $45,000 for the fiscal year ended March
31, 2013 to approximately $708,000 for the fiscal year ended March 31, 2014. The increase was primarily the result of the rental
income generated from leasing out the Shenzhen factory since August 1, 2013.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Selling
Expenses</I>. Selling expenses increased by approximately $121,000 from approximately $268,000 for the fiscal year ended March
31, 2013 to approximately $389,000 for the fiscal year ended March 31, 2014, or 45%. The increase was the result of increased
air shipments due to delay in delivery of our products, due to insufficient workers employed after we moved all production to
the Xinxing factory.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Salaries
And Related Costs</I>. Salaries and related costs increased by approximately $356,000, or 13.6%, from approximately $2,627,000
for the fiscal year ended March 31, 2013 to approximately $2,983,000 for the fiscal year ended March 31, 2014. The increase in
salaries and related costs was primarily the result of an increase in salary of staff in China in accordance with the increase
in minimum wage, and severance payment to staff as a result of termination of all staff in our Shenzhen factory during the transfer
of production processes to our Xinxing factory.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Research
And Development</I>. Research and development expenses decreased approximately $30,000, or 7.6%, from approximately $396,000 for
the fiscal year ended March 31, 2013 to approximately $366,000 for the fiscal year ended March 31, 2014. The decrease in research
and development was primarily the result of decreased headcount of engineers in accordance with decreased projects during the
fiscal year ended March 31, 2014. Research and development expenses account for 1.2% of net revenue for the fiscal year ended
March 31, 2014, and for 1.3% of net revenue for the fiscal year ended March 31, 2013.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Administration
And General Expenses.</I> Administration and general expenses increased by approximately $562,000, or 23.4%, from approximately
$2,402,000 for the fiscal year ended March 31, 2013 to approximately $2,964,000 for the fiscal year ended March 31,2014. The increase
is primarily attributable to an approximately $419,000 loss in fair value of forward contracts for the fiscal year ended March
31, 2014, compared to a $87,000 gain in fair value of forward contracts for the fiscal year ended March 31, 2013.</FONT>&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Other
Income. </I>Other income decreased approximately $100,000, or 83.3%, from approximately $120,000 for the fiscal year ended March
31, 2013 to approximately $20,000 for the fiscal year ended March 31, 2014. A gain of $87,000 for the valuation of forward contracts
was recorded during the fiscal year ended March 31, 2013. However, no such gain on valuation of forward contracts was realized
during the fiscal year ended March 31, 2014.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">47</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 47 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Gain
on Disposal of Property, Plant and Equipment</I>. A gain of $3,595,000 for the disposal of property, plant and equipment related
to the Shenzhen factory was recorded when we transferred all production process to the Xinxing factory and the Shenzhen factory
was leased out for rental income. There was $2,000 gain on disposal of property, plant and equipment during the fiscal year ended
March 31, 2013.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>(Loss)
/ Income From Operations</I>. As a result of the factors described above, income from operations increased by 173.2% from a loss
of approximately $403,000 for the fiscal year ended March 31, 2013 to a profit of approximately $295,000 for the fiscal year ended
March 31, 2014.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Interest
Income</I>. Interest income increased to approximately $64,000 for the fiscal year ended March 31, 2014, as compared to approximately
$7,000 for the fiscal year ended March 31, 2013, due to a deposit placed in high interest yield investment during the fiscal year
ended March 31, 2014.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Interest
Expense</I>. Interest expense increased approximately $68,000, or 100.0%, from approximately $68,000 for the fiscal year ended
March 31, 2013 to approximately $136,000 for the fiscal year ended March 31, 2014. This increase was primarily the result of an
increase in utilization of banking facilities including short term bank loan and bank overdraft during the fiscal year ended March
31, 2014.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Foreign
Exchange Loss. </I>Foreign exchange loss increased approximately $183,000, or 70.1%, from approximately $261,000 for the fiscal
year ended March 31, 2013 to approximately $444,000 for the fiscal year ended March 31, 2014. This increase was primarily the
result of the fluctuation and appreciation of the Chinese Renminbi compared to the United States Dollar during the fiscal year
ended March 31, 2014.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 35.45pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Income
Tax Expense</I>. Income tax expense was $nil during the fiscal year ended March 31, 2014, as compared to $29,000 during the fiscal
year ended March 31, 2013.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Net
Loss</I>. As a result of the factors described above, net loss decreased from a loss of approximately $754,000 for the fiscal
year ended March 31, 2013 to a loss of approximately $221,000 for the fiscal year ended March 31, 2014, a decrease in loss of
approximately $533,000, or 70.7%.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">48</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<!-- Field: Page; Sequence: 48 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Foreign
Currency Translation Adjustments.</I> Foreign currency translation adjustments, net of tax, increased from approximately $62,000
for the fiscal year ended March 31, 2013 to a gain of approximately $257,000 for the fiscal year ended March 31, 2014, a increase
of approximately $195,000, or 314.5%. The increased foreign currency translation adjustment, net of tax, was primarily the result
of increased fluctuation of the Chinese Renminbi against the United States Dollar.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Comprehensive
(Loss) / Income. </I> As a result of the factors described above, comprehensive gain increased from a loss of approximately $692,000
for the fiscal year ended March 31, 2013 to an income of approximately $36,000 for the fiscal year ended March 31, 2014, an increase
of approximately $728,000, or 105.2%.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Impact
of Inflation</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
believe that inflation had an impact on our business during the fiscal years ended March 31, 2012, 2013 and 2014. The minimum
wage in Shenzhen, PRC, increased from RMB 1,100 (or approximately $162) per month beginning July 1, 2010 to RMB 1,320 (or approximately
$206) per month beginning April 1, 2011, and was later increased to RMB 1,500 (or approximately $238) per month beginning February
1, 2012, RMB 1,600 (or approximately $254) per month beginning March 1, 2013 and then to RMB 1,808 (or approximately $293) per
month beginning February 1, 2014. We believe that the impact of inflation on our business was minimal during the fiscal year ended
March 31, 2015 due to the lower price of oil. However, the minimum wage in Xinxing, PRC was increased from RMB 1,010 per month
(or approximately $160) to RMB 1,210 per month (or approximately $197) as of May 1, 2015. As a result, we believe that inflation
will continue to increase our operating costs and cost of raw materials and have a significant impact upon us in the future. We
have generally been able to modify and improve our product designs so that we could either increase the prices of our products
or lower the production costs in order to keep pace with inflation. Oil prices have been volatile in recent years. If oil prices
increase, it will likely result in an increase in the cost of components to us, as well as an increase in our operating expenses,
which will have a material adverse effect upon our business and results of operations. Further, the increase in labor costs and
operating costs in the PRC has had a material impact on our profitability.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">49</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<!-- Field: Page; Sequence: 49 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Taxation</B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 35.45pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
companies comprising the Group are subject to tax on an entity basis on income arising in, or derived from, Hong Kong and the
PRC. The current rate of taxation of the subsidiary operating in Hong Kong is 16.5%. The Group is not subject to income taxes
in the British Virgin Islands.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
tax rates for our subsidiary in the PRC were 24% in 2011 and 25% in 2012 and beyond. There is no tax payable in Hong Kong on offshore
profit or on dividends paid to Bonso Electronics Limited by its subsidiaries or to us by Bonso Electronics Limited. Therefore,
our overall effective tax rate may be lower than that of most United States corporations; however, this advantage could be materially
and adversely affected by changes in the tax laws of the British Virgin Islands, Hong Kong or China.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Efforts
by the Chinese government to increase tax revenues could result in decisions or interpretations of the tax laws by the Chinese
tax authorities that are unfavorable to us and which increase our future tax liabilities or deny our expected refunds. Changes
in Chinese tax laws or their interpretation or application may subject us to additional Chinese taxation in the future.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">No
reciprocal tax treaty regarding withholding taxes exists between the United States and the British Virgin Islands. Under current
British Virgin Islands law, dividends, interest or royalties paid by us to individuals are not subject to tax as long as the recipient
is not a resident of the British Virgin Islands. If we were to pay a dividend, we would not be liable to withhold any tax, but
shareholders would receive gross dividends, irrespective of their residential or national status.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal years ended March 31, 2012, 2013 and 2014, certain of our subsidiaries were, and continue to be, subject to inquiries
from the local tax authorities. Upon the adoption of ASC 740 &ldquo;Income Taxes&rdquo;, the Company recorded a provision of approximately
$2,595,000 in relation to uncertain tax positions as of April 1, 2007. During the fiscal year ended March 31, 2015, the tax review
case was closed and confirmed with the local tax authorities and the final tax and interest payable were approximately $1,545,000.
After offsetting with the tax reserve certificates purchased for approximately $1,710,000, the Company obtained a refund of approximately
$165,000.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Contractual
arrangements we have entered into among us and our subsidiaries in different locations may be subject to scrutiny by respective
tax authorities, and a finding against the Company and its subsidiaries may result in additional tax liabilities that could substantially
reduce our consolidated net income. We could face material and adverse tax consequences if respective tax authorities determine
that the contractual arrangements among our subsidiaries and Bonso do not represent an arm&rsquo;s length price and adjust Bonso&rsquo;s
or its subsidiaries&rsquo; income. Our consolidated net income may be materially and adversely affected if our affiliated entities&rsquo;
tax liabilities increase.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">50</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 50 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Dividends,
if any, paid to any United States resident or citizen shareholder are treated as dividend income for United States federal income
tax purposes. Such dividends are not eligible for the 70% dividends-received deduction allowed to United States corporations on
dividends from a domestic corporation under Section 243 of the United States Internal Revenue Code of 1986, as amended (the &ldquo;Internal
Revenue Code&rdquo;). Various Internal Revenue Code provisions impose special taxes in certain circumstances on non-United States
corporations and their shareholders. You are urged to consult your tax advisor with regard to such possibilities and your own
tax situation.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
addition to United States federal income taxation, shareholders may be subject to state and local taxes upon their receipt of
dividends.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Foreign
Currency Exchange Rates</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
sell most of our products to international customers. Our principal export markets are North America (mainly the United States),
Europe (mainly Germany) and Asia. Other markets are other European countries (such as the United Kingdom), Australia and Africa.
Sales to international customers are made directly by us to our customers. We sell all of our products in United States Dollars
and pay for our material components principally in United States Dollars and Hong Kong Dollars. A very small portion of the components
used are paid for in Japanese Yen. Most factory expenses incurred are paid in Chinese Renminbi. Because the Hong Kong Dollar is
pegged to the United States Dollar, in the past our only material foreign exchange risk arose from potential fluctuations in the
Chinese Renminbi and a devaluation in United States Dollars. For the reasons discussed in the paragraphs below, management believes
that it may be possible that there will be some fluctuation in the coming year. During the fiscal year ended March 31, 2015, we
experienced a foreign currency exchange loss of approximately $134,000.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 6pt; text-align: justify; text-indent: 30pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">A
summary of our debts from our banking facilities utilized as at March 31, 2014 and 2015 which was subject to foreign currency
risk is as follows:</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 6pt; text-align: justify; text-indent: 30pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 56%; text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; text-align: right"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">March 31, 2014</FONT></TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; text-align: right"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">March 31, 2015</FONT></TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$ in thousands</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt/107% Times New Roman, Times, Serif">$ in thousands</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in">Hong Kong dollars and Chinese Yuan</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,477</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,206</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
amount above is due within one year.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt">51</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt"></P>

<!-- Field: Page; Sequence: 51 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt">&nbsp;</P>

<P STYLE="font: 12pt/normal Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Fluctuations
in the value of the Hong Kong Dollar have not been significant since October 17, 1983, when the Hong Kong government tied the
value of the Hong Kong Dollar to that of the United States Dollar. However, there can be no assurance that the value of the Hong
Kong Dollar will continue to be tied to that of the United States Dollar. China adopted a floating currency system on January
1, 1994, unifying the market and official rates of foreign exchange. China approved current account convertibility of the Chinese
Renminbi on July 1, 1996, followed by formal acceptance of the International Monetary Fund&rsquo;s Articles of Agreement on December
1, 1996. These regulations eliminated the requirement for prior government approval to buy foreign exchange for ordinary trade
transactions, though approval is still required to repatriate equity or debt, including interest thereon. From 1994 until July
2005, the Chinese Renminbi had remained stable against the U.S. Dollar at approximately 8.28 to 1.00 U.S. Dollar. On July 21,
2005, the Chinese currency regime was altered to link the RMB to a &ldquo;basket of currencies,&rdquo; which includes the United
States Dollar, Euro, Japanese Yen and Korean Won. Under the rules, the RMB was allowed to move 0.3% on a daily basis against the
United States Dollar. The People's Bank of China, on May 21 2007, widened the RMB trading band from 0.3% daily movement against
the United States Dollar to 0.5%. On June&nbsp;20, 2010, the PBOC announced that the PRC government would further reform the RMB
exchange rate regime and increase the flexibility of the exchange rate, resulting in RMB appreciation against USD from 2010 to
2015, though there have been periods when the U.S. dollar has appreciated against the Renminbi as well. It is difficult to predict
how market forces or PRC or U.S. Government policy may impact the exchange rate between the RMB and the U.S. Dollar in the future.
As of July 15, 2015, the RMB was valued at 6.1089 per U.S. Dollar.</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">To
manage our exposure to foreign currency and translation risks, we may purchase currency exchange forward contracts, currency options
or other derivative instruments, provided such instruments may be obtained at suitable prices.</FONT>&nbsp;</P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Liquidity
and Capital Resources</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have financed our growth and cash needs to date primarily from internally generated funds and bank debt. We do not use off-balance
sheet financing arrangements, such as securitization of receivables or obtaining access to assets through special purpose entities,
as sources of liquidity. Our primary uses of cash have been to fund expansions and upgrades of our manufacturing facilities.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">52&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 52 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Operating
activities generated approximately $2,647,000 of net cash for the fiscal year ended March 31, 2015, as compared to $245,000 of
net cash for the fiscal year ended March 31, 2014. This increase in the amount of cash generated by operating activities was primarily
attributable to an increase in net income and reduction of inventory and trade receivables for the fiscal year ended March 31,
2015.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
of March 31, 2015, we had approximately $3,027,000 in cash and cash equivalents and fixed deposits maturing over three months, as compared to $1,165,000 in cash and cash equivalents and fixed deposits maturing over three months as of March 31,
2014. Working capital at March 31, 2015 was approximately negative $4,391,000, as compared to negative $3,769,000 at March
31, 2014. The decrease in working capital was the result of increased bank loans utilized for the fiscal year ended March
31, 2015. We believe there are no material restrictions (including foreign exchange controls) on the ability of our
subsidiaries to transfer funds to us in the form of cash dividends, loans, advances or product/material purchases. We believe
our working capital is sufficient for our present requirements.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
of March 31, 2015, we had approximately $1,306,000 in net trade receivables, as compared to $2,480,000 as of March 31, 2014. This
decrease of $1,174,000 was primarily attributable to the reduction in revenue and the decrease of shipments made towards the end
of the fiscal year ended March 31, 2015 as compared to the end of the fiscal year ended March 31, 2014.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
of March 31, 2015, we had approximately $3,121,000 in inventories, as compared to $7,545,000 as of March 31, 2014. This decrease
of $4,424,000 was primarily attributable to the reduction in stock levels required for the manufacturing of our products.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
of March 31, 2015, we had a total of approximately $6,621,000 in notes and accounts payable, as compared to $12,940,000 as of
March 31, 2014. The decrease of $6,319,000 was primarily attributable to an increase in our repayment of accounts payable to suppliers.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
of March 31, 2015, we had in place general banking facilities with two financial institutions with amounts available aggregating
approximately $9,438,000 (2014: $10,698,000). Such facilities include the ability to obtain overdrafts, letters of credit, short-term
notes payable, factoring, short-term loans, long-term loans and financial instruments including forward contracts. As of March
31, 2015, we had utilized approximately $5,206,000 from these general banking facilities. Interest on this indebtedness fluctuates
with the prime rate and the Hong Kong Interbank Offer Rate as set by the Hong Kong Bankers Association, and the People&rsquo;s
Bank of China&rsquo;s loan benchmark interest rate. The bank credit facilities are collateralized by our bank guarantee and an
investment property of the Company. Our bank credit facilities are due for renewal annually. We anticipate that the banking facilities
will be renewed on substantially the same terms and our utilization in the next year will remain at a similar level as that in
the current year. During the fiscal years ended March 31, 2014 and 2015, we paid a total of approximately $136,000 and $273,000,
respectively, in interest on indebtedness for continuing operations.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">53</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 53 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
current ratio decreased from 0.80 as of March 31, 2014 to 0.67 as of March 31, 2015. Our quick ratio increased from 0.39 as of
March 31, 2014 to 0.44 as of March 31, 2015.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
minimum wage was increased to RMB 1,320 (or approximately $206) beginning April 1, 2011, and was later increased to RMB 1,500
(or approximately $238) per month beginning February 1, 2012, and to RMB 1,600 (or approximately $254) per month beginning March
1, 2013, and then to RMB 1,808 (or approximately $293) per month beginning February 1, 2014 in Shenzhen, PRC. The minimum wage
was RMB 1,010 (or approximately $164) per month beginning May 1, 2013 in Xinxing, Guangdong, PRC, and was later increased to RMB
1,210 (or approximately $197) beginning May 1, 2015. Our entire manufacturing operation was moved to Xinxing during the fiscal
year ended March 31, 2014, and the overall labor costs have been reduced with the operation in Xinxing.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal year ending March 31, 2016, we expect we will need to expend approximately $301,000 on leasehold improvements to the
manufacturing facility in Xinxing, China.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
believe that our cash flows from operations, our current cash balance and funds available under our working capital and credit
facilities will be sufficient to meet our working capital needs and planned capital expenditures for at least the next 12 to 24
months. However, a decrease in the demand for our products or increase in our costs of goods sold or expenses may affect our internally
generated funds, and we would further look to our banking facilities to meet our working capital demands.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Commitments</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table sets forth information with respect to our commitments as of March 31, 2015:</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid">&#12288;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid">&#12288;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="15" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Payments due by Period</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1pt; padding-left: 0.75pt">&#12288;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Total</B></FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Within 1 year</B></FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2 to 3 years</B></FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>4 to 5 years</B></FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>More than 5 years</B></FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; padding-left: 0.75pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$ in thousands</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$ in thousands</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$ in thousands</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$ in thousands</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$ in thousands</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 35%; text-align: left; padding-left: 0.75pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Notes
    payable and bank overdrafts and loans<SUP>(1) (2)</SUP></FONT></TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">5,357</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">3,994</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,363</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.75pt">Operating leases</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">368</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">119</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">229</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 0.75pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Capital leases<SUP>(2)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">72</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">45</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 0.75pt">Construction in Xinxing</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">301</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">301</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 0.75pt">Income tax liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 0.75pt">Total</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,105</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,446</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,637</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 0 18.85pt 8pt 14.2pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 0 18.85pt 8pt 14.2pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(1)
Represents amounts due under our banking facilities agreements, without considering the &#9;&#9;repayment on demand clause.</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 0 18.85pt 8pt 14.2pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(2)
Includes interest payment.</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">For
a discussion of interest rates on our notes payable and bank loans, see Item 11. &ndash; &ldquo;Qualitative and Quantitative
Disclosures About Market Risk,&rdquo; below.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">54</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 54 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Critical
Accounting Policies</B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
methods, estimates and judgments we use in applying our most critical accounting policies have a significant impact on the results
we report in our financial statements. The SEC has defined the most critical accounting policies as the ones that are most important
to the portrayal of our financial condition and results and require us to make our most difficult and subjective judgments, often
as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, our most critical
policies include valuation of inventories, revenue recognition, impairment of long-lived assets, allowance for trade receivables
and income and deferred income taxes.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Below,
we discuss these policies further, as well as the estimates and judgments involved. We believe that our other policies either
do not generally require us to make estimates and judgments that are as difficult or as subjective, or it is less likely that
they would have a material impact on our reported results of operations for a given period. For a discussion of all our significant
accounting policies, see footnote 1 to the Consolidated Financial Statements included elsewhere in this Annual Report.</FONT><B>&nbsp;</B></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Valuation
of Inventories</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 0 3.25in; text-align: justify; text-indent: -3.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Inventories
are stated at the lower of cost or net realizable value with cost determined on a first-in, first-out basis. Net realizable value
is the price at which inventories can be sold in the normal course of business after allowing for the costs of completion and
disposal. The Company continuously reviews slow-moving and obsolete inventory and assesses any inventory obsolescence based on
inventory levels, material composition and expected usage as of that date.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Revenue
Recognition</B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">No
revenue is recognized unless there is persuasive evidence of an arrangement, the price to the buyer is fixed or determinable,
delivery has occurred and collectability of the sales price is reasonably assured. Revenue is recognized when title and risk of
loss transfers to the customer, which is generally when the product is leaving the port of Hong Kong, Shenzhen or Guangzhou as
designated by our customers. Shipping costs billed to our customers are included within revenue. Associated costs are classified
in cost of sales.</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">55</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center"></P>

<!-- Field: Page; Sequence: 55 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company provides to certain customers an additional one to two percent of certain products ordered in lieu of a warranty, which
are recognized as cost of sales when these products are shipped to customers from our facilities. In addition, certain products
sold by the Company are subject to a limited product quality warranty. The Company accrues for estimated incurred but unidentified
quality issues based upon historical activity and known quality issues if a loss is probable and can be reasonably estimated.
The standard limited warranty period is one to three years. Quality returns, refunds, rebates and discounts are recorded net of
sales if they are within the warranty period. All sales are based upon firm orders with fixed terms and conditions, which generally
cannot be modified. Historically, we have not experienced material differences between our estimated amounts of quality returns,
refunds, rebates and discounts and the actual results.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Impairment
of Long-Lived Assets and Acquired Intangible Assets</B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Long-lived
assets held and used by the Group and acquired intangible assets are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of such assets may not be recoverable. The Group evaluates recoverability of assets to be held
and used by comparing the carrying amount of an asset to future net undiscounted cash flows to be generated by the asset. If such
assets are considered to be impaired, the impairment loss is measured by the amount by which the carrying amount of the assets
exceeds the fair value of the assets calculated using a discounted future cash flows analysis.<B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Allowance
for Trade Receivables</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 35.45pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Allowance
is made against trade receivables to the extent that collection is considered to be doubtful. This allowance is primarily determined
from our monthly aging analysis. It also requires judgment regarding the collectability of certain receivables, as certain receivables
may be identified as collectible that are subsequently uncollectible and which could result in a subsequent write-off of the related
receivable to the statement of operations. Most of the Company&rsquo;s trade receivables are generally unsecured, except for two
customers with receivables covered by credit insurance. To determine the necessity of a provision, the Company analyzes the age
of the receivables and the customer&rsquo;s ability to pay based on past payment history, financial statements and various information
of the customer. Any change in the collectability of accounts receivable that were not previously provided for could significantly
change the calculation of such provision and the results of our operations.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">56</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 56 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Income
and Deferred Income Taxes</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company complies with ASC 740 which prescribes a recognition threshold and measurement attributes for the financial statement
recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on
derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Only tax positions
that meet the more-likely-than-not recognition threshold at the effective date may be recognized or continue to be recognized
upon adoption of ASC 740. The Company&rsquo;s accounting policy is to treat interest and penalties as a component of income taxes.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Amounts
in the consolidated financial statements related to income taxes are calculated using the principles of ASC 740 and ASU 2013-11
&ldquo;Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit
Carryforward Exists.&rdquo; ASC 740 requires recognition of deferred tax assets and liabilities for the expected future tax consequences
of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities
are determined based on the temporary differences between the financial reporting basis and the tax basis of assets and liabilities
using enacted tax rates in effect for the year in which the differences are expected to reverse. Future tax benefits, such as
net operating loss carry forwards, are recognized as deferred tax assets. Recognized deferred tax assets are reduced by a valuation
allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax
asset will not be realized.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Trend
Information</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Although
we are optimistic about our future in the manufacture and sale of sensor-based scales products, we are dependent upon a limited
number of customers for a significant portion of our revenues, and the loss of any of these customers could have a material adverse
effect upon us and our results of operations. As of March 31, 2015, our backlog of manufacturing orders was $4,581,000 as compared
to $6,707,000 as of March 31, 2014. We expect that the demand for our products will decrease in the fiscal year ending March 31,
2016, compared with that in the fiscal year ended March 31, 2015 as a result of our reduction of lower margin electronic scale
products.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Off-Balance
Sheet Arrangements</B></FONT><B>&nbsp;</B></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our
financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures
or capital resources that are material to investors.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">57</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 57 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Recent
Accounting Pronouncements</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
new accounting pronouncements in the United States that may be relevant to the Group are as follows:</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
April 2014, the FASB issued ASU 2014-08, &ldquo;Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment
(Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity&rdquo; (&quot;ASU 2014-08&quot;).
ASU 2014-08 amends the definition of a discontinued operation and requires entities to provide additional disclosures for both
discontinued operations and disposal transactions that do not meet the discontinued operations criteria. It is effective for annual
periods beginning on or after December 15, 2014. We do not expect the adoption of this guidance to have a material effect on our
consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in">In May 2014,
the FASB issued ASU 2014-09. &ldquo;Revenue from Contracts with Customers&rsquo; (&ldquo;ASU 2014-09&rdquo;). The objective of
this Update is to remove inconsistencies and weaknesses in revenue requirements, and to simplify the preparation of financial
statements by reducing the number requirements to which an entity must refer. The new standard supersedes virtually all present
U.S. GAAP guidance on revenue recognition and requires the use of more estimates and judgments than the present standards, as
well as additional disclosures. The FASB has voted to approve a one year deferral of the effective date from January 1, 2017 to
January 1, 2018, while allowing for early adoption as of January 1, 2017. The Company is currently evaluating the impact this
Update will have on its consolidated financial statements.</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
June 2014, the FASB issued ASU 2014-12, &ldquo;Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments
When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period&rdquo; (&ldquo;ASU
2014-12&rdquo;). The amendments in ASU 2014-12 require that a performance target that affects vesting and that could be achieved
after the requisite service period be treated as a performance condition. The amendments in this ASU are effective for annual
reporting periods beginning after December 15, 2015, including interim periods within that reporting period, with early application
permitted. Companies may use either a prospective or a retrospective approach to adopt this ASU and the Company is currently evaluating
which transition approach to use. The Company is evaluating the new pronouncement to determine the impact it may have on its consolidated
financial statements.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">58</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 58 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
January 2015, the FASB issued ASU 2015-01, &ldquo;Income Statement - Extraordinary and Unusual Items (Subtopic 225-20): Simplifying
Income Statement Presentation by Eliminating the Concept of Extraordinary Items&rdquo; (&ldquo;ASU 2015-01&rdquo;). The amendments
in ASU 2015-01 eliminate from U.S. GAAP the concept of extraordinary items. The amendments in this ASU are effective for annual
reporting periods beginning after December 15, 2015, including interim periods within that reporting period, with early application
permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. Companies may use either a
prospective or a retrospective approach to adopt this ASU and the Company is currently evaluating which transition approach to
use. The adoption of ASU 2015-01 is not expected to have a material impact on the Company&rsquo;s consolidated financial statements.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
February 2015, the FASB issued ASU 2015-02, &ldquo;Consolidation (Topic 810): Amendments to the Consolidation Analysis&rdquo;
(&ldquo;ASU 2015-02&rdquo;). The amendments in ASU 2015-02 change the analysis that a reporting entity must perform to determine
whether it should consolidate certain types of legal entities. The amendments in this ASU are effective for public business entities
for fiscal years beginning after December 15, 2015, and for interim periods within those fiscal years. Early adoption is permitted,
including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should
be reflected as of the beginning of the fiscal year that includes that interim period. A reporting entity may apply the amendments
in this ASU using a modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning
of the fiscal year of adoption. A reporting entity also may apply the amendments retrospectively. The adoption of ASU 2015-02
is not expected to have a material impact on the Company&rsquo;s consolidated financial statements.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
April 2015, the FASB issued ASU 2015-03, &ldquo;Simplifying the Presentation of Debt Issuance Costs,&rdquo; (&ldquo;ASU 2015-03&rdquo;)
which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such
costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the
costs will continue to be reported as interest expense. The guidance is effective for fiscal years beginning after December 15,
2015, with early adoption permitted. The adoption of ASU 2015-03 is not expected to have a material impact on the Company&rsquo;s
consolidated financial statements or disclosures.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
April 2015, the FASB issued ASU 2015-05, &ldquo;Customer&rsquo;s Accounting for Fees Paid in a Cloud Computing Arrangement&rdquo;
(&ldquo;ASU 2015-05&rdquo;) (an update to Subtopic 350-40, Intangibles - Goodwill and Other - Internal-Use Software), which provides
guidance on accounting for cloud computing fees. If a cloud computing arrangement includes a software license, then the customer
should account for the license element of the arrangement consistent with the acquisition of other software licenses. If a cloud
computing arrangement does not include a software license, the arrangement should be accounted for as a service contract. This
ASU is effective for arrangements entered into, or materially modified, in interim and annual periods beginning after December
15, 2015. Retrospective application is permitted but not required. The adoption of ASU 2015-05 is not expected to have a material
impact on the Company&rsquo;s consolidated financial statements or disclosures.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">59</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 59 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
May 2015, the FASB issued ASU 2015-07, &ldquo;Fair Value Measurement: Disclosures for Investments in Certain Entities That Calculate
Net Asset Value per Share (or Its Equivalent)&rdquo; (&ldquo;ASU 2015-07&rdquo;), which removes the requirement to categorize
within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical
expedient. The ASU also removes the requirement to make certain disclosures for all investments that are eligible to be measured
at fair value using the net asset value per share practical expedient. Rather, those disclosures are limited to investments for
which the entity has elected to measure the fair value using that practical expedient. This ASU is effective for arrangements
entered into, or materially modified, in interim and annual periods beginning after December 15, 2015. Retrospective application
is permitted but not required. The Company is currently evaluating the impact of this ASU on the consolidated financial statements.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
believe there is no additional new accounting guidance adopted, but not yet effective that is relevant to the readers of our financial
statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact
on our financial reporting.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
6. Directors, Senior Management and Employees</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Directors
and Senior Management</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
Board of Directors and executive officers are listed below:</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>



<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; font-style: italic"><U>Name</U></TD>
    <TD COLSPAN="3" STYLE="font-weight: bold; font-style: italic; text-align: center"><U>Age</U></TD><TD STYLE="font-weight: bold; font-style: italic"></TD>
    <TD STYLE="font-weight: bold; font-style: italic"><U>Position with Bonso</U></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; text-decoration: none"></TD>
    <TD COLSPAN="3" STYLE="font-weight: bold; text-decoration: none; text-align: center">&nbsp;</TD><TD STYLE="font-weight: bold; text-decoration: none; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-decoration: none">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt; width: 30%">Anthony So</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: center; width: 1%">&nbsp;</TD><TD STYLE="text-align: center; width: 10%">72</TD><TD STYLE="padding-bottom: 1pt; text-align: center; width: 1%">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; width: 1%">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt; width: 57%">Chairman of the Board, Chief Executive Officer and Director</TD></TR>
<TR STYLE="vertical-align: top; background-color: White; text-align: left">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt">Andrew So</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="text-align: center">29</TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt">Deputy Chairman of the Board, President, Chief
    Operating     Officer and Director</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt; vertical-align: top">Albert So</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">37</TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt">Director, Chief Financial Officer, Treasurer,
    Financial Controller and Secretary</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt">Kim Wah Chung</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="text-align: center">57</TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt"><P STYLE="margin-top: 0; margin-bottom: 0">Director of Engineering and Research and Development</P>
                                                                           <P STYLE="margin-top: 0; margin-bottom: 0"></P></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt">Woo-Ping Fok</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="text-align: center">66</TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt">Director</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt">Henry F. Schlueter</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="text-align: center">64</TD><TD STYLE="padding-bottom: 1pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Director <FONT STYLE="color: black">and Assistant Secretary</FONT></FONT></TD></TR>
</TABLE>


<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0">60</P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0">&nbsp;</P>

<!-- Field: Page; Sequence: 60 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">ANTHONY
SO is the founder of Bonso. He has been our Chairman of the Board of Directors since July 1988. He was appointed as the Chief
Executive Officer and President on November 16, 2006, and served in those capacities until March 20, 2015 when Andrew So was appointed
President. Mr. So received his BSE degree in civil engineering from National Taiwan University in 1967 and a Master degree in
Business Administration (&ldquo;MBA&rdquo;) from the Hong Kong campus of the University of Hull, Hull, England in 1994. Mr. So
has been Chairman of the Hong Kong GO Association since 1986 and also served as Chairman of the Alumni Association of National
Taiwan University for the 1993-1994 academic years. Mr. So has served as a trustee of the Chinese University of Hong Kong, New
Asia College since 1994.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">ANDREW
SO joined the Company in August 2009 and has been a director since February 25, 2012.&nbsp; Mr. So currently holds the position
of Chief Operating Officer and oversees the Company&rsquo;s daily operations, and has also held the positions of Deputy Chairman
of the Board and President since March 20, 2015. &nbsp;&nbsp;Mr. So graduated with distinctions in 2008 from the University of
Toronto, Canada, with a Bachelor of Commerce degree (BComm). From 2008 to 2009, prior to his employment with the Company, Mr.
So worked as a Derivatives Analyst at State Street Trust Company Canada, Toronto, Canada. Mr. So graduated from the MBA Program
of Hong Kong University of Science and Technology in the Fall of 2014.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">ALBERT
SO was appointed as the Chief Financial Officer and Secretary of the Company on March 27, 2009. He was appointed Treasurer and
Financial Controller of the Company on March 20, 2015. Mr. So was previously employed as the Financial Controller of the Company
in January 2008 and as a management trainee of the Company in November 2004.&nbsp; Mr. So has been a director since March 1, 2013.
Prior to his employment as a management trainee of the Company, Mr. So was a student. &nbsp;Mr. So is a Certified Management Accountant
and Financial Risk Manager, and received a Master degree in Business Administration from Heriot-Watt University, Edinburgh, United
Kingdom, and a Bachelor degree in Mathematics from Simon Fraser University in Burnaby, British Columbia, Canada.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">KIM
WAH CHUNG has been a director since September 21, 1994. Mr. Chung has been employed by us since 1981 and currently holds the position
of Director of Engineering and Research and Development. Mr. Chung is responsible for all research projects and product development.
Mr. Chung&rsquo;s entire engineering career has been spent with Bonso, and he has been involved in all of our major product developments.
Mr. Chung graduated with honors in 1981 from the Chinese University of Hong Kong with a Bachelor of Science degree in electronics.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">WOO-PING
FOK was elected to our Board of Directors on September 21, 1994. Mr. Fok has practiced law in Hong Kong since 1991 and is a Consultant
with Messrs. C.K. Mok &amp; Co. Mr. Fok&rsquo;s major areas of practice include conveyancing and real property law, corporations
and business law, commercial transactions and international trade with a special emphasis in China trade matters. Mr. Fok was
admitted to the Canadian Bar as a Barrister &amp; Solicitor in December 1987 and was a partner in the law firm of Woo &amp; Fok,
a Canadian law firm with its head office in Edmonton, Alberta, Canada. In 1991, Mr. Fok was qualified to practice as a Solicitor
of England &amp; Wales, a Solicitor of Hong Kong and a Barrister &amp; Solicitor of Australian Capital Territory.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">61</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 61 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">HENRY
F. SCHLUETER has been a director since October 2001 and has been our Assistant Secretary since October 6, 1988. Since 1992, Mr.
Schlueter has been the Managing Director of Schlueter &amp; Associates, P.C., a law firm, practicing in the areas of securities,
mergers and acquisitions, finance and corporate law. Mr. Schlueter has served as our United States corporate and securities counsel
since 1988. From 1989 to 1991, prior to establishing Schlueter &amp; Associates, P.C., Mr. Schlueter was a partner in the Denver,
Colorado office of Kutak Rock (formerly Kutak, Rock &amp; Campbell), and from 1984 to 1989, he was a partner in the Denver office
of Nelson &amp; Harding. Mr. Schlueter is a member of the American Institute of Certified Public Accountants, the Colorado and
Denver Bar Associations and the Wyoming State Bar.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Anthony
So, the Company&rsquo;s Chief Executive Officer and Chairman of the Board of Directors is the father of Andrew So, the Company&rsquo;s
President and Chief Operating Officer, and Albert So, the Company&rsquo;s Chief Financial Officer, Treasurer and Secretary.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">No
arrangement or understanding exists between any such director or officer and any other persons pursuant to which any director
or executive officer was elected as a director or executive officer. Our directors are elected annually and serve until their
successors take office or until their death, resignation or removal. The executive officers serve at the pleasure of the Board
of Directors.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">62</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 62 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Compensation</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
aggregate amount of compensation paid by us and our subsidiaries during the year ended March 31, 2015 to all directors, former
directors and officers as a group for services in all capacities was $1,305,000. Total compensation for the benefit of Anthony
So was $857,000, for the benefit of Kim Wah Chung was $160,000, for the benefit of Andrew So was $124,000, for the benefit of
Albert So was $109,000 and for the benefit of Henry F. Schlueter was an aggregate of $55,000. The $55,000 listed as having been
paid for the benefit of Mr. Schlueter was paid to his law firm, Schlueter &amp; Associates, P.C., for legal services rendered.
The amount for the year ended March 31, 2015, included unpaid vacation payments of $9,000 and $57,000 for Kim Wah Chung and Anthony
So, respectively.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
did not set aside or accrue any amounts to provide pension, retirement or similar benefits for directors and officers for the
fiscal year ended March 31, 2015, other than contributions to our Provident Fund Plan, which aggregated $17,000 for officers and
directors.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Employment
Agreements</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have employment agreements with Anthony So and Kim Wah Chung. Mr. So&rsquo;s employment agreement provides for a maximum yearly
salary of approximately $800,000 per year plus bonus, and Mr. Chung&rsquo;s employment agreement provides for a maximum yearly
salary of approximately $200,000 per year plus bonus, as stated in their respective employment agreements. The initial term of
the employment agreements expired on March 31, 2013 (&ldquo;Initial Term&rdquo;); however, the employment agreements have been
renewed under a provision in the agreements that provides for automatic renewal for successive one year periods, unless at least
90 days prior to the expiration of the Initial Term or any renewal term, either party gives written notice to the other party
specifically electing to terminate the agreement. One of the properties of the Group in Hong Kong is also provided to Mr. So as
part of his compensation. Mr. So&rsquo;s employment agreement contains a provision under which the Company will&#9; be obligated
to pay Mr. So all compensation for the remainder of his employment agreement and five times his annual salary and bonus compensation
if a change of control, as defined in his employment agreement, occurs. Both employment agreements with Anthony So and Kim Wah
Chung were renewed automatically, and the respective employment agreements will expire on March 31, 2016, unless automatically
renewed.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">63</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 63 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Options
of Directors and Senior Management</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table provides information concerning options owned by the directors and senior management at July 15, 2015.&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt; vertical-align: bottom; border-bottom: Black 1pt solid"><B>Name</B></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"><B>&nbsp;</B></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 1pt"><B>&nbsp;</B></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0; text-align: center"><B>Number
                                         of Common</B></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center"><B>Shares
                                         Subject to</B></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center"><B>Stock
                                         Options</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 1pt"><B>&nbsp;</B></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"><B>&nbsp;</B></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 1pt"><B>&nbsp;</B></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: bottom; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0"><B>Exercise
                                         Price</B></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><B>Per
                                         Share</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-bottom: 1pt"><B>&nbsp;</B></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"><B>&nbsp;</B></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt; border-bottom: Black 1pt solid"><B>Expiration Date</B></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 22%; font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Anthony So</TD><TD STYLE="width: 5%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 19%; font: 10pt Times New Roman, Times, Serif; text-align: center">150,000</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 19%; font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 21%; font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2020</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">150,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2025</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Andrew So</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">125,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2020</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">125,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2025</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Albert So</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">60,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2020</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">60,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2025</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">Kim Wah Chung</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">40,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2020</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">40,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2025</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">Woo-Ping Fok</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">10,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">4.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">December 4, 2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">25,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2020</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">25,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2025</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 5.4pt">Henry F. Schlueter</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">10,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">4.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">December 4, 2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">25,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2020</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-left: 5.4pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">25,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top">1.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 5.4pt">March 31, 2025</TD></TR>
</TABLE>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Directors</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Except
as mentioned above, our directors do not receive any additional monetary compensation for serving in their capacities. All directors
are reimbursed for all reasonable expenses incurred in connection with their services as a director.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">64</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify">&nbsp;</P>

<!-- Field: Page; Sequence: 64 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Employee
retirement benefits</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(a)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">With
                                         effect from January 1, 1988, BEL, a wholly-owned foreign subsidiary of the Company in
                                         Hong Kong, implemented a defined contribution plan (the &ldquo;Plan&rdquo;) with a major
                                         international assurance company to provide life insurance and retirement benefits for
                                         its employees. All permanent full time employees who joined BEL before December 2000,
                                         excluding factory workers, are eligible to join the provident fund plan. Eligible employees
                                         of the Plan are required to contribute 5% of their monthly salary, while BEL is required
                                         to contribute from 5% to 10% based on the eligible employee&rsquo;s salary, depending
                                         on the number of years of the eligible employee&rsquo;s service.</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 0 3.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 0 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Mandatory Provident Fund (the &ldquo;MPF&rdquo;) was introduced by the Hong Kong Government and commenced in December 2000. BEL
joined the MPF by implementing a plan with a major international assurance company. All permanent Hong Kong full time employees
who joined BEL on or after December 2000, excluding factory workers, are eligible to join the MPF. Eligible employees&rsquo; and
the employer&rsquo;s contributions to the MPF are both at 5% of the eligible employee&rsquo;s monthly salary and are subject to
a maximum mandatory contribution of HK$1,000 (US$128) monthly. The maximum mandatory contribution was increased to HK$1,250 (US$160)
monthly starting from June 1, 2012. The maximum mandatory contribution was increased to HK$1,500 (US$192) per month starting from
June 1, 2014.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 0 3.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pursuant
to the relevant PRC regulations, the Group is required to make contributions for each employee, at rates based upon the employee&rsquo;s
standard salary base as determined by the local Social Security Bureau, to a defined contribution retirement scheme organized
by the local Social Security Bureau in respect of the retirement benefits for the Group&rsquo;s employees in the PRC.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(b)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
                                         contributions to each of the above schemes are recognized as employee benefit expense
                                         when they are due and are charged to the consolidated statement of income (loss). The
                                         Group&rsquo;s total contributions to the above schemes for the years ended March 31,
                                         2013, 2014 and 2015 amounted to approximately $225,000, $758,000 and $693,000, respectively.
                                         The Group has no other obligation to make payments in respect of retirement benefits
                                         of the employees.</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Board
Practices</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">All
directors hold office until our next annual meeting of shareholders or until their respective successors are duly elected and
qualified or their positions are earlier vacated by resignation or otherwise. All executive officers are appointed by the Board
and serve at the pleasure of the Board. There are no director service contracts providing for benefits upon termination of employment
or directorship.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">65</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<!-- Field: Page; Sequence: 65 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>NASDAQ
Exemptions and Home Country Practices</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">NASDAQ
Marketplace Rule 4350 provides that foreign private issuers may elect to follow certain home country corporate governance practices
so long as they provide NASDAQ with a letter from outside counsel in its home country certifying that the issuer 's corporate
governance practices are not prohibited by home country law.</FONT></P>

<P STYLE="font: 12pt/normal Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
July 19, 2005, we submitted a letter to NASDAQ certifying that certain of Bonso&rsquo;s corporate governance practices are not
prohibited by the relevant laws of the British Virgin Islands. We will follow British Virgin Island law in respect to the following
requirements:</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">A
                                         majority of Bonso&rsquo;s Board of Directors will not be independent;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Bonso
                                         will not have a nominating committee;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Bonso
                                         will not have a compensation committee;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Bonso&rsquo;s
                                         independent directors will not meet in executive session; and</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Bonso&rsquo;s
                                         audit committee may have only one member.</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 5pt 0 0"></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 5pt 0 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Audit
Committee</B></FONT></P>

<P STYLE="font: 12pt/normal Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Mr.
Woo-Ping Fok is the sole member of the Audit Committee and Mr. Schlueter serves as an ad hoc member. Mr. Fok is &ldquo;independent&rdquo;
as defined in the NASDAQ listing standards, and Mr. Schlueter may not be considered &ldquo;independent&rdquo; since his law firm
serves as Bonso&rsquo;s United States counsel.</FONT></P>

<P STYLE="font: 12pt/normal Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Audit Committee was established to: (i) review and approve the scope of audit procedures employed by our independent auditors;
(ii) review and approve the audit reports rendered by our independent auditors; (iii) approve the audit fee charged by the independent
auditors; (iv) report to the Board of Directors with respect to such matters; (v) recommend the selection of independent auditors;
and (vi) discharge such other responsibilities as may be delegated to it from time to time by the Board of Directors. Effective
as of June 30, 2015, the Board of Directors adopted an amended charter for its Audit Committee.</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Employees</B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">At
March 31, 2015, we employed a total of 528 persons, as compared to 663 persons at March 31, 2014 and 1,127 persons at March 31,
2013; 8 employees in Hong Kong (12 in 2014 and 13 in 2013) and 520 employees in China (651 in 2014 and 1,114 in 2013). Employees
are not covered by collective bargaining agreements. We consider our global labor practices and employee relations to be good.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">66</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<!-- Field: Page; Sequence: 66 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Share
Ownership</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table shows the number of shares of common stock beneficially owned by our directors and executive officers as of July
15, 2015:&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 4.5pt; border-bottom: Black 1pt solid">Name</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Shares of</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Common</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Stock</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Owned of</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Record</P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1pt"></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Options Held</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Total Number of Shares of</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Common</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Stock</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Beneficially</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Owned</P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: center; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-size: 9pt; text-align: center; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: center; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Percent</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">of</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Beneficial</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">Ownership</P></TD><TD STYLE="font-size: 9pt; text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 4.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt">&nbsp;</TD>
    <TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 40%; font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 4.5pt">Anthony So</TD><TD STYLE="width: 3%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; font: 10pt Times New Roman, Times, Serif; text-align: right">2,281,770</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left"><SUP>(1)</SUP></TD><TD STYLE="width: 3%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; font: 10pt Times New Roman, Times, Serif; text-align: right">300,000</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left"><SUP>(2)</SUP></TD><TD STYLE="width: 3%; font: 10pt Times New Roman, Times, Serif"><SUP>&nbsp;</SUP></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; font: 10pt Times New Roman, Times, Serif; text-align: right">2,581,770</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 3%; font-size: 9pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; font-size: 9pt; text-align: right">46.5</TD><TD STYLE="width: 1%; font-size: 9pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 9pt; text-align: left; padding-left: 4.5pt"><P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Andrew
So</FONT></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">453,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">250,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><SUP>(3)</SUP></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">703,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt">&nbsp;</TD>
    <TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: right">12.8</TD><TD STYLE="font-size: 9pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 4.5pt">Albert So</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">250,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">120,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><SUP>(4)</SUP></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>&nbsp;</SUP></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">370,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt">&nbsp;</TD>
    <TD STYLE="font-size: 9pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 9pt; text-align: right">6.9</TD><TD STYLE="font-size: 9pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 9pt; text-align: left; padding-left: 4.5pt"><P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Kim
Wah Chung&nbsp;</FONT></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">93,700</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">80,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><SUP>(5)</SUP></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">173,700</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">3.3</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 9pt; padding-left: 4.5pt"><P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Woo-Ping
Fok&nbsp;</FONT></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">66,507</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">60,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><SUP>(6)</SUP></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>&nbsp;</SUP></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">126,507</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">2.4</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 9pt; text-align: left; padding-left: 4.5pt"><P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Henry
F. Schlueter</FONT></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">34,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">60,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><SUP>(7)</SUP></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>&nbsp;</SUP></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">94,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">1.8</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 9pt; text-align: left; padding-left: 4.5pt"><P STYLE="margin-top: 0; margin-bottom: 0">All Directors and Officers as a group (6)</P>
                                                                      <P STYLE="margin-top: 0; margin-bottom: 0"></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">3,178,997</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">870,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">4,048,977</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">66.2</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 9pt; text-align: left; padding-left: 4.5pt">persons)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="17" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: justify"><P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0">Note: The number of shares outstanding is 5,246,903 shares, with 5,577,639 total number of shares issued, which includes 330,736 shares in treasury.&nbsp;&nbsp;The calculations above are based upon the number of shares issued of 5,246,903.</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P></TD></TR>
</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt/normal Courier New; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 31.7pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(1)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Includes
                                         1,143,421 shares of common stock owned of record by a corporation that is wholly owned
                                         by a trust of which Mr. So is the sole beneficiary.</FONT></TD></TR>                                                                                                             <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin-top: 0; margin-bottom: 0; text-align: center">67</P>

<P STYLE="margin-top: 0; margin-bottom: 0; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<P STYLE="margin-top: 0; margin-bottom: 0"></P>

<!-- Field: Page; Sequence: 67 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 31.7pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(2)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Includes
                                         options to purchase 150,000 shares of common stock at an exercise price of $1.50 per
                                         share expiring on March 31, 2020 and options to purchase 150,000 shares of common stock
                                         at an exercise price of $1.50 per share expiring on March 31, 2025.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 31.7pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(3)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Includes
                                         options to purchase 125,000 shares of common stock at an exercise price of $1.50 per
                                         share expiring on March 31, 2020 and, options to purchase 125,000 shares of common stock
                                         at an exercise price of $1.50 per share expiring on March 31, 2025.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 31.7pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(4)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Includes
                                         options to purchase 60,000 shares of common stock at an exercise price of $1.50 per share
                                         expiring on March 31, 2020 and options to purchase 60,000 shares of common stock at an
                                         exercise price of $1.50 per share expiring on March 31, 2025.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 31.7pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(5)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Includes
                                         options to purchase 40,000 shares of common stock at an exercise price of $1.50 per share
                                         expiring on March 31, 2020 and options to purchase 40,000 shares of common stock at an
                                         exercise price of $1.50 per share expiring on March 31, 2025.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 31.7pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(6)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Includes
                                         options to purchase 10,000 shares of common stock at an exercise price of $4.50 per share
                                         expiring on December 4, 2015, options to purchase 25,000 shares of common stock at an
                                         exercise price of $1.50 per share expiring on March 31, 2020 and options to purchase
                                         25,000 shares of common stock at an exercise price of $1.50 per share expiring on March
                                         31, 2025.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 31.7pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(7)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Includes
                                         options to purchase 10,000 shares of common stock at an exercise price of $4.50 per share
                                         expiring on December 4, 2015, options to purchase 25,000 shares of common stock at an
                                         exercise price of $1.50 per share expiring on March 31, 2020 and options to purchase
                                         25,000 shares of common stock at an exercise price of $1.50 per share expiring on March
                                         31, 2025.</FONT></TD></TR>                                                                   <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
</TABLE>




<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Stock
Option and Bonus Plans</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>The
1996 Stock Option Plan</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
October 1996, our stockholders adopted the 1996 Stock Option Plan (the &ldquo;Employees&rsquo; Plan&rdquo;), which provides for
the grant of options to purchase an aggregate of not more than 400,000 shares of our common stock. In January 2000, our shareholders
approved the proposal of the Board of Directors to increase from 400,000 to 900,000 in the aggregate the number of options to
purchase common stock under the Employees&rsquo; Plan. The purpose of the Employees&rsquo; Plan is to make options available to
management and employees in order to encourage them to secure or increase on reasonable terms their stock ownership and to encourage
them to remain with the Company.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Employees&rsquo; Plan is administered by a committee appointed by the Board of Directors which determines the persons to be granted
options under the Employees&rsquo; Plan, the number of shares subject to each option, the exercise price of each option and the
option period, subject to the requirement that no option may be exercisable more than ten years after the date of grant. The exercise
price of an option may be less than the fair market value of the underlying shares of common stock. No options granted under the
Employees&rsquo; Plan are transferable by the optionee other than by will or the laws of descent and distribution, and each option
will be exercisable during the lifetime of the optionee only by such optionee.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">68</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 68 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
exercise price of an option granted pursuant to the Employees&rsquo; Plan may be paid in cash, by the surrender of options, in
common stock, in other property, including the optionee&rsquo;s promissory note, or by a combination of the above, at our discretion.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal year ended March 31, 2015, no options were granted under the Employees&rsquo; Plan. As of July 15, 2015, there are
30,000 options outstanding which were issued under the 1996 Stock Option Plan.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>The
2004 Stock Option Plan</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
March 23, 2004, our stockholders adopted the 2004 Stock Option Plan (the &ldquo;2004 Plan&rdquo;), which provided for the grant
of up to six hundred thousand (600,000) shares of the Company&rsquo;s common stock in the form of stock options, subject to certain
adjustments as described in the 2004 Plan. At the Annual Meeting of Shareholders held on March 20, 2015, the shareholders approved
an amendment to the 2004 Plan to increase the number of shares that could be granted from 600,000 to 850,000.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
purpose of the 2004 Plan is to secure key employees to remain in the employ of the Company and to encourage such employees to
secure or increase on reasonable terms their common stock ownership in the Company. The Company believes that the 2004 Plan promotes
continuity of management and increased incentive and personal interest in the welfare of the Company.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
2004 Plan is administered by a committee appointed by the Board of Directors, which consists of at least two but not more than
three members of the Board, one of whom shall be a non-employee of the Company. The committee members currently are Anthony So
and Woo-Ping Fok. The committee determines the specific terms of the options granted, including the employees to be granted options
under the plan, the number of shares subject to each option grant, the exercise price of each option and the option period, subject
to the requirement that no option may be exercisable more than 10 years after the date of grant. The exercise price of an option
may be less than the fair market value of the underlying shares of common stock. No options granted under the plan will be transferable
by the optionee other than by will or the laws of descent and distribution, and each option will be exercisable during the lifetime
of the optionee only by the optionee.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">69</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 69 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
exercise price of an option granted pursuant to the 2004 Plan may be paid in cash, by the surrender of options, in common stock,
in other property, including a promissory note from the optionee, or by a combination of the above, at the discretion of the Committee.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
of March 31, 2015, no options had been granted under the 2004 Plan; however, effective July 9, 2015, the Board of Directors approved
the issuance of an aggregate of 850,000 options to officers and directors of the Company at an exercise price of $1.50 per share.
As of July 15, 2015, there are 850,000 options outstanding which were issued under the 2004 Plan.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2004
Stock Bonus Plan</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
September 7, 2004, our stockholders adopted the 2004 Stock Bonus Plan (the &ldquo;Stock Bonus Plan&rdquo;), which authorizes the
issuance of up to five hundred thousand (500,000) shares of the Company&rsquo;s Common Stock in the form of a stock bonus.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
purpose of this Stock Bonus Plan is to: (i) induce key employees to remain in the employ of the Company or of any subsidiary of
the Company; (ii) encourage such employees to secure or increase their stock ownership in the Company; and (iii) reward employees,
non-employee directors, advisors and consultants for services rendered, or to be rendered, to or for the benefit of the Company
or any of its subsidiaries. The Company believes that the Stock Bonus Plan will promote continuity of management and increased
incentive and personal interest in the welfare of the Company.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Stock Bonus Plan is administered by a committee appointed by the Board of Directors which consists of at least two but not more
than three members of the Board, one of whom shall be a non-employee of the Company. The Committee members currently are Anthony
So and Woo-Ping Fok. The Committee has the authority, in its sole discretion: (i) to determine the parties to receive bonus stock,
the times when they shall receive such awards, the number of shares to be issued and the time, terms and conditions of the issuance
of any such shares; (ii) to construe and interpret the terms of the Stock Bonus Plan; (iii) to establish, amend and rescind rules
and regulations for the administration of the Stock Bonus Plan; and (iv) to make all other determinations necessary or advisable
for administering the Stock Bonus Plan.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
of March 31, 2015, no shares had been granted under the Stock Bonus Plan.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">70</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 70 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
7. Major Shareholders and Related Party Transactions</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Major
shareholders</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
are not directly or indirectly owned or controlled by any foreign government or by another corporation. The following table sets
forth, as of July 15, 2015, beneficial ownership of our common stock by each person, to the best of our knowledge, known to own
beneficially 5% or more of our common stock outstanding as of such date. Except as otherwise indicated, all shares are owned directly
and hold equal voting rights.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; padding-left: 4.5pt"><U>Name</U></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><P STYLE="margin-top: 0; margin-bottom: 0; text-align: center"><U>Shares
                                         of</U></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center"><U>Common</U></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center"><U>Stock
                                         Owned</U></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><U>&nbsp;</U></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right"><P STYLE="margin-top: 0; margin-bottom: 0; text-align: center"><U>Options
                                         to Purchase</U></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center"><U>Common</U></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0; text-align: center"><U>Stock</U></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; vertical-align: top"><P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
                                                                                                                                                                                    <P STYLE="margin-top: 0; margin-bottom: 0"><U>Percent
                                         of Beneficial</U></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><U>Ownership
                                         </U><SUP>(1)</SUP></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 46%; font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 4.5pt">Anthony So</TD><TD STYLE="width: 4%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2,281,770 <FONT STYLE="line-height: 107%"><SUP></SUP></FONT></FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left"><SUP>(2)</SUP></TD><TD STYLE="width: 5%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font: 10pt Times New Roman, Times, Serif; text-align: right">300,000</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; font: 10pt Times New Roman, Times, Serif; text-align: right">46.5</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 4.5pt">Andrew So</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">453,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">250,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">12.8</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 4.5pt">Albert So</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">250,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">120,000</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">6.9</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 4.5pt">CAS Corporation</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">290,654</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><SUP>(3)</SUP></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5.5</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; padding-left: 4.5pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 22.3pt"></TD><TD STYLE="width: 31.7pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(1)</FONT></TD><TD STYLE="padding-right: 28.2pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
                                         number of shares outstanding is 5,246,903 shares, with 5,577,639 total number of shares
                                         issued, which includes 330,736 shares in treasury. The calculations above are based upon
                                         the number of shares issued of 5,246,903.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 22.3pt"></TD><TD STYLE="width: 31.7pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(2)</FONT></TD><TD STYLE="text-align: justify; padding-right: 28.2pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Includes
                                         1,143,421 shares of common stock owned of record by a corporation that is wholly owned
                                         by a trust of which Mr. So is the sole beneficiary.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 22.3pt"></TD><TD STYLE="width: 31.7pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(3)</FONT></TD><TD STYLE="text-align: justify; padding-right: 28.2pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">According
                                         to the Schedule 13D filed by CAS Corporation on December 11, 2007.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">There
are no arrangements known to us which may at a subsequent date result in a change in control of the Company.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Related
Party Transactions</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal years ended March 31, 2013, 2014 and 2015, we paid Schlueter &amp; Associates, P.C. an aggregate of $74,000,
$84,000 and $55,000, respectively for legal fees. Mr. Henry F. Schlueter, a director of the Company, is the Managing Director
of Schlueter &amp; Associates, P.C.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal year ended March 31, 2015, Anthony So, our Chairman and Chief Executive Officer, made an interest-free loan to Bonso
Advanced Technology Limited, a subsidiary of Bonso Electronics International Inc., in the principal amount of HK$4,200,000 (approximately
US$538,000 as of the date of the loan). The loan is payable in 48 equal monthly installments of HK$87,500 each (approximately
US$11,000), commencing on October 31, 2014. As of March 31, 2015, the Company had repaid approximately $67,000 to Mr. Anthony
So, and the balance of the loan due to Mr. Anthony So was approximately $471,000.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">71</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 71 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal year ended March 31, 2015, one of our subsidiaries in Shenzhen, PRC entered into a rental agreement with a director
and shareholder, Mr. Anthony So, for three apartment units located in Shenzhen, PRC for office usage. Mr. Anthony So is the sole
owner of these three apartment units. The monthly rental payment was approximately $2,000, and the total rent paid to Mr. Anthony
So during the fiscal year ended March 31, 2015 was approximately $10,000.</FONT>&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal year ended March 31, 2015, one of our subsidiaries in Xinxing, PRC entered into a rental agreement with a director
and shareholder, Mr. Andrew So, for an apartment unit located in Xinxing, PRC for staff quarters. Mr. Andrew So is the sole owner
of this apartment unit. The monthly rental payment was approximately $480, and the total rent paid to Mr. Andrew So during the
fiscal year ended March 31, 2015 was approximately $2,000.<BR>
</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal year ended March 31, 2014, we made loans aggregating approximately $1,052,000 to our Chairman and Chief Executive Officer,
Anthony So. Management believed at the time that the loans were made that these loans were permissible and did not violate Section
13(k) of the Exchange Act, because Mr. So would be able to repay the full amount by foregoing his salary and accrued annual leave
payments until the loans had been paid in full.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
advanced the funds to Mr. So on two separate occasions, and Mr. So directed that his salary payments and accrued annual leave
payments be used to offset the amounts that we loaned to him. In addition, Mr. Albert So and Mr. Andrew So, who are officers and
directors of the Company, directed the Company to use their accrued annual leave payments to partially satisfy the amounts due
to the Company from Mr. Anthony So. On March 31, 2014, the amount due to the Company from Mr. So was $166,000. On August 7, 2014,
Mr. So paid $166,000 to the Company to fully repay the amounts loaned to him. The loans were non-interest bearing.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Notwithstanding
Mr. Anthony So&rsquo;s repayment in full of the loans made to him, those loans constitute a violation of Section 13(k) of the
Exchange Act and Section 402(a) of the Sarbanes-Oxley Act.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
a result of this inadvertent violation, the Board adopted a policy regarding loans or advances to any Executive Officer or Director
of the Company. The policy provides that &ldquo;The Company shall not directly or indirectly, including through any subsidiary,
extend or maintain credit to, or arrange for the extension of credit, or renew an extension of credit, in the form of a personal
loan to or for any Director or Executive Officer (or equivalent thereof) of the Company or any subsidiary of the Company.&rdquo;</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">72</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 72 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Interests
of Experts and Counsel</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Not
Applicable to Bonso.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Legal
Proceedings</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Not
Applicable to Bonso.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
8. Financial Information</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Financial
Statements</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
Consolidated Financial Statements are set forth under Item 18. &ndash; &ldquo;Financial Statements.&rdquo;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
9. The Offer and Listing</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Offer
and Listing Details</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
common stock is traded only in the United States over-the-counter market. It is quoted on the NASDAQ Capital Market under the
trading symbol &ldquo;BNSO.&rdquo; The following table sets forth, for the periods indicated, the range of high and low closing
sales prices per share reported by NASDAQ. The quotations represent prices between dealers and do not include retail markup, markdown
or commissions and may not necessarily represent actual transactions.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table sets forth the high and low sale prices for each of the last five years:</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 88%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid">Period</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid">High</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid">Low</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 26%; text-align: left; vertical-align: top">April 1, 2010 to March 31, 2011&#9;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 20%; text-align: center; vertical-align: top">2.44</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 20%; text-align: center; vertical-align: top">0.86</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left; vertical-align: top">April 1, 2011 to March 31, 2012&#9;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">2.80</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.07</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left; vertical-align: top"><P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">&#9;April 1, 2012 to March 31, 2013</P></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.88</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">0.88</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left; vertical-align: top">&#9;April 1, 2013 to March 31, 2014</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">2.94</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.33</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left; vertical-align: top"><P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P><P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9;April 1, 2014 to March 31, 2015</FONT></P></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">2.10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.11</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">73</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 73 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table sets forth the high and low sale prices during each of the quarters in the two-year period ended June 30, 2015.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 88%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Period</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">High</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Low</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 30%; text-align: left; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">July 1, 2013 to September 30, 2013</FONT></TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 4%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 20%; text-align: center; vertical-align: top">1.98</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 20%; text-align: center; vertical-align: top">1.35</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; vertical-align: top; text-indent: -11pt; padding-left: 11pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">October 1, 2013 to December 31, 2013</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">2.23</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.35</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">January 1, 2014 to March 31, 2014</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">2.94</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.46</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">April 1, 2014 to
June 30, 2014</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">2.10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.34</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">July 1, 2014 to September
30, 2014&#9;</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">2.02</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.31</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; vertical-align: top">October 1, 2014 to December 31, 2014&#9;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.88</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.11</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; vertical-align: top">January 1, 2015 to March 31, 2015</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.57</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.24</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; vertical-align: top">April 1, 2015 to June 30, 2015&#9;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.84</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.25</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table sets forth the high and low sale prices during each of the most recent six months.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 76%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Period</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">High</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Low</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left; vertical-align: top">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 20%; text-align: left; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">January 2015</FONT></TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 20%; text-align: center; vertical-align: top">1.44</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 20%; text-align: center; vertical-align: top">1.25</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">February 2015</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.57</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.24</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">March 2015</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.54</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.29</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">April 2015</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.70</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.25</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">May 2015</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.84</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.56</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">June 2015</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.72</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.31</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
July 15, 2015, the closing price of our common stock was $1.40. Of the 5,577,639 shares of common stock issued as of June 30,
2015, 5,246,903 shares were outstanding, 2,412,370 shares were held in the United States by 160 holders of record and 330,736
shares were held by the Company as treasury stock. We have 172 shareholders of record.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;74</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0">&nbsp;</P>

<!-- Field: Page; Sequence: 74 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Transfer
and Warrant Agent</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
transfer agent and registrar for the common stock is Computershare, 1745 Gardena Avenue #200, Glendale, California 91204.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
10. Additional Information</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Share
Capital</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
authorized capital is $170,000, consisting of 23,333,334 shares of common stock, $0.003 par value per share, and 10,000,000 authorized
shares of preferred stock, $0.01 par value, divided into 2,500,000 shares each of class A preferred stock, class B preferred stock,
class C preferred stock and class D preferred stock. Information with respect to the number of shares of common stock outstanding
at the beginning and at the end of the last three fiscal years is presented in the Consolidated Statements of Changes in Stockholders&rsquo;
Equity for the fiscal years ended March 31, 2013, 2014 and 2015 included herein in Item 18.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">At
July 15, 2015, there were 5,577,639 shares of our common stock issued, 5,246,903 shares were outstanding, and 330,736 shares were
held by the Company in treasury. All shares were fully paid. In addition, we had outstanding 880,000 options to purchase common
stock as follows:</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 67%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: bottom; border-bottom: Black 1pt solid">Number of Options</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid">Exercise Price per Share</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; vertical-align: bottom; border-bottom: Black 1pt solid">Expiration Date</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 20%; text-align: right">30,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 12%; text-align: center; vertical-align: top">4.50</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 15%">December 4, 2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">425,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD>March 31, 2020</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">425,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: center; vertical-align: top">1.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD>March 31, 2025</TD></TR>
</TABLE>


<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">At
July 15, 2015, there were no shares of our preferred stock outstanding.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Memorandum
and Articles of Association</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
are registered in the British Virgin Islands and have been assigned company number 9032 in the register of companies. Our registered
agent is HWR Services Limited at Craigmuir Chambers, P.O. Box 71, Road Town, Tortola, British Virgin Islands. The object or purpose
of the Company is to engage in any act or activity that is not prohibited under British Virgin Islands law as set forth in Paragraph
4 of our Memorandum of Association. As an International Business Company, we are prohibited from doing business with persons resident
in the British Virgin Islands, owning real estate in the British Virgin Islands or acting as a bank or insurance company. We do
not believe that these restrictions materially affect our operations.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">75</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 75 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Paragraph
57(c) of our Amended Articles of Association (the &ldquo;Articles&rdquo;) provides that a director may be counted as one of a
quorum in respect of any contract or arrangement in which the director is materially interested; however, if the agreement or
transaction cannot be approved by a resolution of directors without counting the vote or consent of any interested director, the
agreement or transaction may only be validated by approval or ratification by a resolution of the members. Paragraph 53 of the
Articles allows the directors to vote compensation to themselves in respect of services rendered to the Company. Paragraph 66
of the Articles provides that the directors may by resolution exercise all the powers of the Company to borrow money and to mortgage
or charge its undertakings and property or any part thereof, to issue debentures, debenture stock and other securities whenever
money is borrowed or as security for any debt, liability or obligation of ours or of any third party. Such borrowing powers can
be altered by an amendment to the Articles. There is no provision in the Articles for the mandatory retirement of directors. Directors
are not required to own shares of the Company in order to serve as directors.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
authorized share capital is $170,000, divided into 23,333,334 shares of common stock, $0.003 par value, and 10,000,000 authorized
shares of preferred stock, $0.01 par value. Holders of our common stock are entitled to one vote for each whole share on all matters
to be voted upon by shareholders, including the election of directors. Holders of our common stock do not have cumulative voting
rights in the election of directors. All of our common shares are equal to each other with respect to liquidation and dividend
rights. Holders of our common shares are entitled to receive dividends if and when declared by our Board of Directors out of funds
legally available therefor under British Virgin Islands law. In the event of our liquidation, all assets available for distribution
to the holders of our common stock are distributable among them according to their respective holdings. Holders of our common
stock have no preemptive rights to purchase any additional unissued common shares. No shares of our preferred stock have been
issued; however, the Board of Directors has the ability to determine the rights, preferences and restrictions of the preferred
stock at their discretion.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Paragraph
7 of the Memorandum of Association provides that without prejudice to any special rights previously conferred on the holders of
any existing shares, any share may be issued with such preferred, deferred or other special rights or such restrictions, whether
in regard to dividend, voting, return of capital or otherwise, as the directors may from time to time determine.</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">76</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 76 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Paragraph
10 of the Memorandum of Association provides that if at any time the authorized share capital is divided into different classes
or series of shares, the rights attached to any class or series may be varied with the consent in writing of the holders of not
less than three-fourths of the issued shares of any other class or series of shares which may be affected by such variation.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Paragraph
105 of the Articles of Association provides that our Memorandum and Articles of Association may be amended by a resolution of
members or a resolution of directors. Thus, our Board of Directors without shareholder approval may amend our Memorandum and Articles
of Association. This includes amendments to increase or reduce our authorized capital stock. Our ability to amend our Memorandum
and Articles of Association without shareholder approval could have the effect of delaying, deterring or preventing a change in
control of the Company, including a tender offer to purchase our common shares at a premium over the then current market price.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Provisions
in respect of the holding of general meetings and extraordinary general meetings are set out in Paragraphs 68 through 77 of the
Articles and under the International Business Companies Act. The directors may convene meetings of the members at such times and
in such manner and places as the directors consider necessary or desirable, and they shall convene such a meeting upon the written
request of members holding more than 30% of the votes of our outstanding voting shares.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">British
Virgin Islands law and our Memorandum and Articles of Association impose no limitations on the right of nonresident or foreign
owners to hold or vote our securities. There are no provisions in the Memorandum and Articles of Association governing the ownership
threshold above which shareholder ownership must be disclosed.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">A
copy of our Memorandum and Articles of Association, as amended, was filed as an exhibit to our Registration Statement on Form
F-2 (SEC File No. 333-32524).</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Material
Contracts</B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following summarizes each material contract, other than contracts entered into in the ordinary course of business, to which Bonso
or any subsidiary of Bonso is a party, for the two years immediately preceding the filing of this report:</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
signed a Banking Facility Letter dated February 26, 2015 with Hang Seng Bank for an approximately HK$48.3 million (or approximately
US$6.2 million) letter of credit, trust receipt facility, export D/P bills, export trade loan, factoring, overdraft facility and
financial instruments including forward contracts. A copy of this Banking Facilities Letter is attached to this Annual Report
on Form 20-F as Exhibit 4.1 and is incorporated herein by this reference.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">77</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.4in"></P>

<!-- Field: Page; Sequence: 77 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.4in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.4in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
signed a Banking Facility Letter dated April 29, 2014 with China Construction Bank for RMB 20 million (or approximately $3.2 million)
for a letter of credit, import loan and term loans. An extract copy of the English translation of the banking facility letter
is attached to this Annual Report on Form 20-F as Exhibit 4.2 and is incorporated herein by this reference.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.4in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;<BR></B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Exchange
Controls</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">There
are no exchange control restrictions on payments of dividends on our common stock or on the conduct of our operations either in
Hong Kong, where our principal executive offices are located, or the British Virgin Islands, where we are incorporated. Other
jurisdictions in which we conduct operations may have various exchange controls. Taxation and repatriation of profits regarding
our China operations are regulated by Chinese laws and regulations. With respect to our PRC subsidiaries, with the exception of
a requirement that approximately 11% of profits be reserved for future developments and staff welfare, there are no restrictions
on the payment of dividends and the removal of dividends from China once all taxes are paid and assessed and losses, if any, from
previous years have been made good. To date, these controls have not had, and are not expected to have, a material impact on our
financial results. There are no material British Virgin Islands laws that impose foreign exchange controls on us or that affect
the payment of dividends, interest or other payments to holders of our securities who are not residents of the British Virgin
Islands. British Virgin Islands law and our Memorandum and Articles of Association impose no limitations on the right of nonresident
or foreign owners to hold or vote our securities.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Taxation</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">No
reciprocal tax treaty regarding withholding exists between the United States and the British Virgin Islands. Under current British
Virgin Islands law, dividends, interest or royalties paid by us to individuals are not subject to tax as long as the recipient
is not a resident of the British Virgin Islands. If we were to pay a dividend, we would not be liable to withhold any tax, but
shareholders would receive gross dividends, if any, irrespective of their residential or national status.</FONT>&nbsp;</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Dividends,
if any, paid to any United States resident or citizen shareholder are treated as dividend income for United States federal income
tax purposes. Such dividends are not eligible for the 70% dividends-received deduction allowed to United States corporations on
dividends from a domestic corporation under Section 243 of the Internal Revenue Code. Various Internal Revenue Code provisions
impose special taxes in certain circumstances on non-United States corporations and their shareholders. You are urged to consult
your tax advisor with regard to such possibilities and your own tax situation.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">A
foreign corporation will be treated as a passive foreign investment company (&ldquo;PFIC&rdquo;) for United States federal income
tax purposes if, after applying relevant look-through rules with respect to the income and assets of subsidiaries, 75% or more
of its gross income consists of certain types of passive income or 50% or more of the gross value of its assets is attributable
to assets that produce passive income or are held for the production of passive income. For this purpose, passive income generally
includes dividends, interest, royalties, rents (other that rents and royalties derived in the active conduct of a trade or business),
annuities and gains from assets that produce passive income. We presently believe that we are not a PFIC and do not anticipate
becoming a PFIC. This is, however, a factual determination made on an annual basis and is subject to change. If we were to be
classified as a PFIC in any taxable year, (i)&nbsp;U.S. holders would generally be required to treat any gain on sales of our
shares held by them as ordinary income and to pay an interest charge on the value of the deferral of their United States federal
income tax attributable to such gain and (ii)&nbsp;distributions paid by us to our United States holders could also be subject
to an interest charge. In addition, we would not provide information to our United States holders that would enable them to make
a &ldquo;qualified electing fund&rdquo; election under which, generally, in lieu of the foregoing treatment, our earnings would
be currently included in their United States federal income.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
addition to United States federal income taxation, shareholders may be subject to state and local taxes upon their receipt of
dividends.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Documents
on Display</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">You
may read and copy documents referred to in this Annual Report on Form 20-F that have been filed with the SEC at the SEC&rsquo;s
Public Reference Room, 450 Fifth Street, N.W., Washington, D.C. You may obtain information on the operation of the Public Reference
Room by calling the SEC at 1-800-SEC-0330. You can also obtain copies of our SEC filings by going to the SEC&rsquo;s website at
http://www.sec.gov.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
SEC allows us to &ldquo;incorporate by reference&rdquo; the information we file with the SEC. This means that we can disclose
important information to you by referring you to another document filed separately with the SEC. The information incorporated
by reference is considered to be part of this Annual Report on Form 20-F.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>


<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center">78</P>

<P STYLE="font: 10pt/107% Times New Roman, Times, Serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 78 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
11. Quantitative and Qualitative Disclosures About Market Risk</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
are exposed to a certain level of interest rate risk and foreign currency exchange risk.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Interest
Rate Risk</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Our
interest rate risk primarily arises from our bank borrowings and our general banking facilities. As at March 31, 2015, we
had utilized approximately $5,206,000 of our total banking facilities of $9,438,000. Based on the maturity profile and
composition of our long-term debt and general banking facilities, including the fact that our banking facilities are at
variable interest rates, we estimate that changes in interest rates will not have a material impact on our operating results
or cash flows. We intend to manage our interest rate risk through appropriate borrowing strategies. We have not entered into
interest rate swap or risk management agreements; however, it is possible that we may do so in the future.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">A
summary of our debts as at March 31, 2015 which were subject to variable interest rates is as below:</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">March 31,</FONT></TD><TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt; vertical-align: top">Interest</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 5.4pt; text-align: center; vertical-align: top; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; vertical-align: top; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 1pt solid">2015</TD><TD STYLE="text-align: center; vertical-align: top; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt; vertical-align: top; border-bottom: Black 1pt solid">Rate</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 28%; text-align: left; padding-left: 5.4pt">Notes payable</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 15%; text-align: right">1,830,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 39%; text-align: center; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">HIBOR<SUP>(1) </SUP>+ 2.5%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Bank overdraft - secured</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;nil</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt">PRIME + 1%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 5.4pt">Factoring</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;nil</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">HIBOR<SUP>(1) </SUP>+ 1.5%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Short term loans</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">1,026,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">HIBOR<SUP>(1) </SUP>+ 2.25%,</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Long term loans<SUP> (2)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">$</TD><TD STYLE="text-align: right">2,350,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">HIBOR<SUP>(1) </SUP>+ 2.25%, and<br> People's Bank of China&rsquo;s loan benchmark interest rate times 110% for loans in PRC</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center; padding-left: 5.4pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-right: 0; margin-bottom: 0; text-indent: 0.5in"><SUP>&nbsp;</SUP></P>

<P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin-top: 0; margin-right: 0; margin-bottom: 0; text-indent: 0.5in"><SUP>(1)
</SUP>HIBOR is the Hong Kong Interbank Offer Rate.</P>

<P STYLE="font: 10pt/normal Courier New; margin: 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>(2)
</SUP>A clause in the banking facilities states that the term loans are subject to review any time and also subject to the bank's
overriding right of repayment on demand, including the right to call for cash cover on demand for prospective and contingent liabilities.
Therefore, all long-term loans were classified as current liabilities in the consolidated balance sheets.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">A
change in the interest rate of 1% will increase or decrease the interest expense of the Company by approximately $63,000.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">79</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT>&nbsp;</P>

<!-- Field: Page; Sequence: 79 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">For
further information concerning our banking facilities, the interest rates payable and repayment terms, please see Note 7 to our
Consolidated Financial Statements included elsewhere in this Annual Report.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Foreign
Currency Exchange Rates</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">For
a discussion of our Foreign Currency Exchange Risk, See Item 5. &ndash; &ldquo;Operating and Financial Review and Prospects -
Foreign Currency Exchange Rates.&rdquo;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
12. Description of Securities Other Than Equity Securities</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Not
applicable to Bonso.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>PART
II</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
13. Defaults, Dividend Arrearages and Delinquencies</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">None.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
14. Material Modifications to the Rights of Security Holders and Use of Proceeds</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">None.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
15. Controls and Procedures</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company&rsquo;s management, with the participation of Andrew So, its Chief Operating Officer, and Albert So, its Chief Financial
Officer, conducted an evaluation of our disclosure controls and procedures, as defined in paragraph (e) of Rule 13a-15 or 15d-15
under the Exchange Act, as of March 31, 2015. Our Company's internal control over financial reporting is a process designed under
the supervision of the Chief Executive Officer, the Chief Operating Officer and the Chief Financial Officer to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies
and procedures that:</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 12pt"></TD><TD STYLE="width: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">1.</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">pertain
                                         to the maintenance of records that, in reasonable detail, accurately and fairly reflect
                                         the transactions and dispositions of our assets;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 12pt"></TD><TD STYLE="width: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2.</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">provide
                                         reasonable assurance that transactions are recorded as necessary to permit preparation
                                         of financial statements in accordance with generally accepted accounting principles,
                                         and that receipts and expenditures of our Company are being made only in accordance with
                                         authorizations of our management and directors; and</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 12pt"></TD><TD STYLE="width: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">provide
                                         reasonable assurance regarding prevention or timely detection of unauthorized acquisition,
                                         use or disposition of assets that could have a material effect on the financial statements.</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt/115% Times New Roman,serif; margin: 0 0 10pt 12pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/115% Times New Roman,serif; margin-top: 0; margin-bottom: 10pt; text-align: center">80</P>

<P STYLE="font: 10pt/115% Times New Roman,serif; margin-top: 0; margin-bottom: 10pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 80 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">There
are inherent limitations in the effectiveness of any internal control, including the possibility of human error and the circumvention
or overriding of controls. Accordingly, even effective internal controls can provide only reasonable assurances with respect to
financial statement preparation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures
may deteriorate.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
making this assessment, management used the criteria established in 2013 Internal Control&mdash;Integrated Framework issued by
the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on the assessment, the Company&rsquo;s management,
including its Chief Operating Officer and Chief Financial Officer, have concluded that, as of March 31, 2015, there were certain
material weaknesses in our internal controls, over financial reporting related to our financial closing process, the lack of trained
accounting personnel and the failure to enter certain transactions into the accounting records on a timely basis. All three of
these weaknesses were identified in the Form 20-F that we filed during the previous year.&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
                                         have not maintained effective internal control over the financial closing process to
                                         provide reasonable assurance that the financial statements are prepared in accordance
                                         with Generally Accepted Accounting Principles (GAAP).</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 0 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
                                         did not have:</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 22.5pt"></TD><TD STYLE="width: 18pt">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">a
                                         sufficient number of experienced personnel in our accounting and finance departments
                                         to provide reasonable assurance that transactions were being recorded, and adequate supervisory
                                         reviews and monitoring activities over financial reporting matters and controls performed,
                                         as necessary to permit the preparation of the financial statements in accordance with
                                         GAAP;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 22.5pt"></TD><TD STYLE="width: 18pt">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">timely
                                         and accurate preparation and review of period-end account analyses and timely disposition
                                         of any required adjustments; and</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 22.5pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">adequate
                                         training of and communication to employees regarding their duties and control responsibilities
                                         within the accounting and finance organization to ensure that processes and control activities
                                         were being carried out appropriately.</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 0 21pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">These
material weaknesses resulted in material post-closing adjustments reflected in the financial statements for the year ended March
31, 2015. These adjustments resulted in changes to assets, liabilities, stockholders' equity, income and expenses.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">81</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 0 21pt; text-align: justify"></P>

<!-- Field: Page; Sequence: 81 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 0 21pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 0 21pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the fiscal year ended March 31, 2014, we identified additional material weaknesses, relating to the conduct of our year end
inventory count, and the approval of loans to an officer and director in violation of Section 13(k) adopted under the
Exchange Act as more particularly described below. We have taken certain remedial actions to address these matters and
management does not believe that these material weaknesses exist    as of March 31, 2015. The remedial actions we took to
address these two weaknesses included the following:&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
                                         Company built a new warehouse in order to enhance categorizing and storage of inventory.
                                         Also, a new warehouse supervisor was employed who was a former employee of the Company&rsquo;s
                                         old Shenzhen factory to oversee the warehouse control of all inventories.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
                                         Company hired a new accounting manager with 20 years of experience in wholly-owned foreign
                                         enterprises, for training, reviewing and controlling all the daily bookkeeping and financial
                                         report closing activities.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
                                         Board adopted a policy regarding loans or advances to any Executive Officer or Director
                                         of the Company subsequent to March 31, 2014. The policy provides that &ldquo;The Company
                                         shall not directly or indirectly, including through any subsidiary, extend or maintain
                                         credit to, or arrange for the extension of credit, or renew an extension of credit, in
                                         the form of a personal loan to or for any Director or Executive Officer (or equivalent
                                         thereof) of the Company or any subsidiary of the Company.&rdquo;</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Management
                                         and the Directors of the Company received training with respect to various requirements
                                         under the securities laws of the United States, including &ldquo;insider trading,&rdquo;
                                         US reporting requirements for foreign private issuers and requirements imposed upon the
                                         Company under Sarbanes-Oxley and Dodd-Frank.</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Notwithstanding
the identified material weaknesses, management believes the consolidated financial statements included in this Annual Report on
Form 20-F fairly present in all material respects our financial condition, results of operations and cash flows at and for the
periods presented in accordance with U.S. GAAP.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Remediation
Efforts</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
response to the material weaknesses described above, management intends to do the following:</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">&bull;</TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Provide
                                         further training and communication to its accounting staff with regard to the recording
                                         of transactions in the accounting records, and closing procedures and practices.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Increase
                                         supervisory review and monitoring activities over financial reporting matters and controls.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&bull;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consider
                                         hiring either an additional experienced accountant with U.S. GAAP experience or outside
                                         consultants to work with the Company and its accounting staff. </FONT></TD></TR></TABLE>



<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;82</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 82 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">If
the remedial measures described above are insufficient to address any of the identified material weaknesses or are not implemented
effectively, or additional deficiencies arise in the future, material misstatements in our interim or annual financial statements
may occur in the future. We are currently working to implement enhanced controls, as discussed above, to address the material
weaknesses in our internal control over financial reporting and to remedy the ineffectiveness of our disclosure controls and procedures.
A key element of our remediation effort is the ability to recruit and retain qualified individuals to support our remediation
efforts. While our Audit Committee and Board of Directors have been supportive of our efforts by supporting the hiring of various
individuals in finance, as well as funding efforts to improve our financial reporting system, improvement in internal control
will be hampered if we cannot recruit and retain more qualified professionals. Among other things, any unremediated material weaknesses
could result in material post-closing adjustments in future financial statements. Furthermore, any such unremediated material
weaknesses could have the effects described above in the Risk Factor captioned &ldquo;We have identified material weaknesses in
our internal control over financial reporting which could, if not remediated, result in material misstatements in our financial
statements.&rdquo; Management believes that the remediation items listed above, if executed, will ensure that data and reports
can be relied upon for the purpose of accurately and timely recording transactions in accordance with GAAP.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Changes
in Internal Controls</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">There
were no changes in the Company&rsquo;s internal controls during the period covered by this Report that have materially affected
or are reasonably likely to materially affect our internal control over financial reporting.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
16. Reserved</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
16A. Audit Committee Financial Expert</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Henry
F. Schlueter is an ad hoc member of the Company&rsquo;s Audit Committee and is deemed to be a financial expert. Mr. Schlueter,
the Company&rsquo;s outside securities counsel, may not be deemed to be &ldquo;independent&rdquo; within the definition of &ldquo;independence&rdquo;
published by NASDAQ.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">83</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"></P>

<!-- Field: Page; Sequence: 83 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
16B. Code of Ethics</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have adopted a code of ethics that applies to our Chief Executive Officer and Chief Financial Officer. We intend to disclose any
changes in, or waivers from, our code of ethics by filing a Form&nbsp;6-K. Stockholders may request a free copy in print form
from our Chief Financial Officer at:</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 1.2pt 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 0 1.2pt 8pt 112.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Bonso
Electronics International, Inc.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 0 1.2pt 8pt 112.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Unit
1404, 14/F, Cheuk Nang Centre</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 0 1.2pt 8pt 112.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">9
Hillwood Road, Tsimshatsui</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 0 1.2pt 8pt 112.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Kowloon</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 0 112.5pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Hong
Kong</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
16C. Principal Accountant Fees and Services</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Audit
Committee&rsquo;s Pre-approval Policies and Procedure</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Audit Committee must pre-approve the audit and non-audit services performed by the independent auditor in order to assure that
the provision of such services does not impair the auditor's independence. Before the Company or any of its subsidiaries engage
the independent auditor to render a service, the engagement must be either:</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(1)&#9;specifically
approved by the Audit Committee; or</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(2)&#9;entered
into pursuant to this Pre-Approval Policy.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 0.5in; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
term of any pre-approval is 12 months from the date of pre-approval, unless the Audit Committee specifically provides for a different
period. The Audit Committee may periodically revise the list of pre-approved services.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Audit Committee may delegate pre-approval authority to one or more of its members. The member or members to whom such authority
is delegated shall report any pre-approval decisions to the Audit Committee at its next scheduled meeting. The Audit Committee
may not delegate to management the Audit Committee's responsibilities to pre-approve services performed by the independent auditor.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Audit Committee must specifically pre-approve the terms of the annual audit services engagement. The Audit Committee shall approve,
if necessary, any changes in terms resulting from changes in audit scope, Company structure or other matters. In addition to the
annual audit services engagement approved by the Audit Committee, the Audit Committee may grant pre-approval for other audit services,
which are those services that only the independent auditor reasonably can provide.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">84</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 84 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Audit Committee may grant pre-approval to those permissible non-audit services classified as other services that it believes would
not impair the independence of the auditor, including those that are routine and recurring services.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Audit Committee may consider the amount or range of estimated fees as a factor in determining whether a proposed service would
impair the auditor's independence. Where the Audit Committee has approved an estimated fee for a service, the pre-approval applies
to all services described in the approval. However, in the event the invoice in respect of any such service is materially in excess
of the estimated amount or range, the Audit Committee must approve such excess amount prior to payment of the invoice. The Audit
Committee expects that any requests to pay invoices in excess of the estimated amounts will include an explanation as to the reason
for the overage. The Company&rsquo;s independent auditor will be informed of this policy.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company&rsquo;s management shall inform the Audit Committee of each service performed by the independent auditor pursuant to this
Pre-Approval Policy. Requests or applications to provide services that require separate approval by the Audit Committee shall
be submitted to the Audit Committee by both the independent auditor and the Chief Financial Officer and must include a joint statement
as to whether, in their view, the request or application is consistent with the SEC&rsquo;s and the Public Company Accounting
Oversight Board (United States)&rsquo;s rules on auditor independence.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Audit Fees indicated below were pre-approved by the Audit Committee before the auditor commenced their work.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: left"><FONT STYLE="font: normal 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Audit
Fees</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B>&nbsp;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
aggregate fees billed by Moore Stephens CPA Limited for professional services rendered for the audit of the Company&rsquo;s annual
consolidated financial statements for the fiscal years ended March 31, 2015 and 2014 were $190,000 and $200,000, respectively.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Audit
Related Fees</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">There
were no fees billed by Moore Stephens CPA Limited for professional services rendered for assurance and related services that were
reasonably related to the performance of the audit and are not reported above under &ldquo;Audit Fees&rdquo; for the fiscal year
ended March 31, 2015 and for the fiscal year ended March 31, 2014.</FONT></P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center">85</P>

<P STYLE="font: 10pt/normal Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 85 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Tax
Fees</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: normal 10pt Times New Roman, Times, Serif">The
aggregate fees billed for professional services rendered for tax compliance for the fiscal year ended March 31, 2015 were approximately
$3,600 and $4,500 for the fiscal year ended March 31, 2014.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0 0 8pt; text-align: justify"></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
16D. Exemptions from the Listing Standards for Audit Committees</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pursuant
to NASDAQ Marketplace Rule 4350(a), a foreign private issuer may follow its home country practice in lieu of Rule 4350, which
sets forth the qualitative Listing Requirements for NASDAQ listed companies. Rule 4350 requires, among other things, that a listed
company have at least three members on its audit committee. The Company currently has an audit committee consisting of two directors,
one of whom is deemed to be &ldquo;independent&rdquo; as defined in NASDAQ Marketplace Rule 4200. The Company has obtained a letter
from independent counsel in the British Virgin Islands certifying that having a single member audit committee is not prohibited
by British Virgin Island law. See &ldquo;NASDAQ Exemptions and Home Country Practices.&rdquo;</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
16E. Purchasers of Equity Securities by the Issuer and Affiliated Purchasers</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0"><FONT STYLE="font: normal 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In
August of 2001, the Company's Board of Directors authorized a program for the Company to repurchase up to $500,000 of its common
stock. This repurchase program does not obligate the Company to acquire any specific number of shares or acquire shares over any
specified period of time. No stocks had been repurchased up to March 31, 2006. On November 16, 2006, the Company's Board of Directors
authorized an additional $1,000,000 for the Company&rsquo;s repurchase of its common stock under the same repurchase program.
This authorization to repurchase shares increased the amount authorized for repurchase from $500,000 to $1,500,000. The Company
(through its subsidiary) has repurchased an aggregate of 330,736 shares of its common stock, including 70,019 ($134,000) shares
that were repurchased during the fiscal year ended March 31, 2009. No shares were repurchased during the fiscal years ended March
31, 2013, 2014 and 2015. The Company may from time to time repurchase shares of its Common Stock under this program.&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
16F. Changes in Registrant&rsquo;s Certifying Accountants.</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Not
applicable to Bonso.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">86</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<!-- Field: Page; Sequence: 86 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
16G. Corporate Governance.</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">For
a discussion of the ways in which the Company&rsquo;s corporate governance differs from those followed by domestic companies under
the NASDAQ Marketplace listing requirements, see &ldquo;NASDAQ Exemptions and Home Country Practices&rdquo; above.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
16H. Mine Safety Disclosure.</B></FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Not
applicable to Bonso.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>PART
III</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
17. Financial Statements</B></FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Not
applicable.</FONT></P>

<P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: justify; text-indent: 0in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: bold 12pt/normal Times New Roman,serif; margin: 0; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item
18. Financial Statements</B></FONT></P>

<P STYLE="font: bold 12pt/115% Times New Roman,serif; margin: 0 0 10pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following Financial Statements are filed as part of this Annual Report:</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 12pt Arial Unicode MS,sans-serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 80%; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 20%; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Page</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Report of Independent Registered Public Accounting Firm</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">F-1</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consolidated Balance Sheets as of March 31, 2014 and 2015&#9;</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">F-2</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9;Consolidated Statements of Operations and Comprehensive&#9;(Loss)
    / Income for the years ended March 31, 2013, 2014 and 2015</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">F-3</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9;Consolidated Statements of Changes in Stockholders&rsquo; Equity
    for the&#9;&#9;years ended March 31, 2013, 2014 and 2015</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">F-4</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT><P STYLE="font: 12pt/normal Times New Roman,serif; margin: 0; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consolidated
                                         Statements of Cash Flows for the years ended</FONT></P>

<P STYLE="font: 12pt/115% Times New Roman,serif; margin: 0 0 10pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9;March
31, 2013, 2014 and 2015</FONT></P>

</TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">F-5</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Notes to Consolidated Financial Statements&#9;</FONT></TD>
    <TD STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">F-6 through F-40</FONT></TD></TR>
</TABLE>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"></P>

<P STYLE="font: 12pt/115% Times New Roman,serif; margin-top: 0; text-align: center; margin-bottom: 10pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;87</FONT></P>

<P STYLE="font: 12pt/115% Times New Roman,serif; margin: 0 0 10pt; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Times New Roman,serif; margin: 0 0 10pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<!-- Field: Page; Sequence: 87 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/115% Times New Roman,serif; margin: 0 0 10pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT><BR CLEAR="ALL">
<FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Item 19. Exhibits</B></FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT><BR>
<BR></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 12pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0">                                                                                                                                                                                                                                                                                                                                                                                                                  <TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.1</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Banking
                                                                                                                                                           Facility
                                                                                                                                                           Letter,
                                                                                                                                                           dated
                                                                                                                                                           February
                                                                                                                                                           26,
                                                                                                                                                           2015
                                                                                                                                                           between
                                                                                                                                                           Bonso
                                                                                                                                                           and
                                                                                                                                                           the
                                                                                                                                                           Hang
                                                                                                                                                           Seng
                                                                                                                                                           Bank Limited</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
<TD>&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.2</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Banking
                                         Facility Letter, dated April 29, 2014 between Bonso and China Construction Bank of China</FONT></TD></TR>
</TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-indent: -0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0">                                                                                                                                                    <TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD>&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
<TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">12.1</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Certification
                                         of Officer Pursuant to Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley
                                         Act of 2002</FONT></TD></TR>
</TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-indent: -0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>


<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-indent: -0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">12.2</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Certification
                                                                                                                                of
                                                                                                                                Officer
                                                                                                                                Pursuant
                                                                                                                                to
                                                                                                                                Section
                                                                                                                                1350,
                                                                                                                                as
                                                                                                                                adopted
                                                                                                                                pursuant
                                                                                                                                to
                                                                                                                                Section
                                                                                                                                302
                                                                                                                                of
                                                                                                                                the
                                                                                                                                Sarbanes-Oxley
                                                                                                                                Act
                                                                                                                                of
                                                                                                                                2002</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-indent: -0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 12pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">13.1</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Certification
                                                                                                                                Pursuant
                                                                                                                                to
                                                                                                                                18
                                                                                                                                U.S.C.
                                                                                                                                1350
                                                                                                                                as
                                                                                                                                adopted
                                                                                                                                pursuant
                                                                                                                                to
                                                                                                                                Section
                                                                                                                                906
                                                                                                                                of
                                                                                                                                the
                                                                                                                                Sarbanes-Oxley
                                                                                                                                Act
                                                                                                                                of
                                                                                                                                2002</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-indent: -0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 12pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">13.2</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Certification
                                                                                                                                Pursuant
                                                                                                                                to
                                                                                                                                18
                                                                                                                                U.S.C.
                                                                                                                                1350
                                                                                                                                as
                                                                                                                                adopted
                                                                                                                                pursuant
                                                                                                                                to
                                                                                                                                Section
                                                                                                                                906
                                                                                                                                of
                                                                                                                                the
                                                                                                                                Sarbanes-Oxley
                                                                                                                                Act
                                                                                                                                of
                                                                                                                                2002</FONT></TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0 0 0 1in; text-indent: -0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD STYLE="width: 0.9in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(1)</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Filed
                                                                                                                               as
                                                                                                                               an
                                                                                                                               Exhibit
                                                                                                                               on
                                                                                                                               Form
                                                                                                                               20-F
                                                                                                                               filed
                                                                                                                               with
                                                                                                                               the
                                                                                                                               Commission
                                                                                                                               on
                                                                                                                               August
                                                                                                                               15,
                                                                                                                               2013.</FONT></TD></TR>                                                                                                                                                     <TR STYLE="vertical-align: top; background-color: White">
<TD>&nbsp;</TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(2)</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Filed
                                         as an Exhibit on Form 20-F filed with the commission on August 13, 2004.</FONT></TD></TR>
</TABLE>




<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt">                                                                                                                                             <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">14.1</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Code
                                         of Business Conduct and Ethics</FONT></TD></TR>                                                                                        <TR STYLE="vertical-align: top; background-color: White">
<TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">14.2</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Code
                                         of Ethics for Senior Financial Officers &nbsp;</FONT></TD></TR>
</TABLE>


<FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD STYLE="width: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">14.3</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Foreign
                                         Corrupt Practices Act Compliance Policy</FONT></TD></TR>                                                                                                 <TR STYLE="vertical-align: top; background-color: White">
<TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">14.4</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Whistleblower
                                         Policy</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
<TD>&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">99.1</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Audit Committee Charter, as amended effective June 30, 2015</FONT></TD></TR>
</TABLE>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 1in; text-indent: -0.5in"></P>


<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">88</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt; border-bottom: Black 1pt solid">&nbsp;</P>


<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>


<!-- Field: Page; Sequence: 88 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 112.5pt; text-align: center; text-indent: -1in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>SIGNATURE</B></FONT></P>

<P STYLE="font: bold 12pt/115% Times New Roman,serif; margin: 0 0 10pt; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Times New Roman,serif; margin: 0 1.35pt 10pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized
the undersigned to sign this Annual Report on its behalf.</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 1.35pt 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 12pt Arial Unicode MS,sans-serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 50%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 50%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">BONSO ELECTRONICS INTERNATIONAL INC.</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Dated: August 14, 2015</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><U>/s/ Anthony So<FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></U></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9;Anthony
So, Chairman of the Board, Chief &#9;Executive Officer and Director</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;Dated:
    August 14,     2015</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><U>/s/ Albert So<FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></U></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Albert
So, Chief Financial Officer, Treasurer and Secretary</FONT></TD></TR>
<TR STYLE="vertical-align: top; text-align: left; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; text-align: center; margin-bottom: 5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">89</FONT>&nbsp;</P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 89 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>




<P STYLE="font: 12pt/115% Times New Roman,serif; margin-top: 0; margin-bottom: 10pt; text-align: center">&#9;</P>






<P STYLE="margin: 0"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc.</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">(Incorporated in the British Virgin Islands)</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">Consolidated Financial Statements</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">March 31, 2015</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt"><B>&nbsp;</B></P>


<!-- Field: Page; Sequence: 1 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc.</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Index to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman,serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 80%"><B>Contents</B></TD>
    <TD STYLE="width: 20%; text-align: center; vertical-align: top"><B>Pages</B></TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD>Report of Independent Registered Public Accounting Firm</TD>
    <TD STYLE="text-align: center; vertical-align: top">F-1</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD>Consolidated Balance Sheets as of March
31, 2014 and 2015</TD>
    <TD STYLE="text-align: center; vertical-align: top">F-2</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD>Consolidated Statements of Operations and
Comprehensive (Loss) / Income for the years ended March 31, 2013, 2014 and 2015</TD>
    <TD STYLE="text-align: center; vertical-align: top">F-3</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD>Consolidated Statements of Changes in Stockholders&rsquo;
Equity for the years ended March 31, 2013, 2014 and 2015</TD>
    <TD STYLE="text-align: center; vertical-align: top">F-4</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD>Consolidated Statements of Cash Flows for
the years ended March 31, 2013, 2014 and 2015</TD>
    <TD STYLE="text-align: center; vertical-align: top">F-5</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center; vertical-align: top">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD>Notes to Consolidated Financial Statements</TD>
    <TD STYLE="text-align: center; vertical-align: top">F-6 to F-40</TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; border-bottom: Black 1pt solid"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">&nbsp;</P>


<!-- Field: Page; Sequence: 2 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: right"><IMG SRC="accountan.jpg" ALT="" STYLE="height: 150; width: 150">&nbsp;</P>



<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: right"><B>&nbsp;</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B><U>Report of Independent Registered Public
Accounting Firm</U></B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">To the Board of Directors and Stockholders of</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">Bonso Electronics International Inc.</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">We have audited the accompanying consolidated
balance sheets of Bonso Electronics International Inc. and subsidiaries (the &ldquo;Company&rdquo;) as of March 31, 2014 and 2015
and the related consolidated statements of operations and comprehensive (loss) / income, changes in stockholders&rsquo; equity,
and cash flows for each of the three years in the period ended March 31, 2015. These consolidated financial statements are the
responsibility of the Company&rsquo;s management. Our responsibility is to express an opinion on these consolidated financial
statements based on our audits.</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.
Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the Company&rsquo;s
internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the consolidated financial position of the Company as of
March 31, 2014 and 2015, and the consolidated results of its operations and its cash flows for each of the three years in the period
ended March 31, 2015, in conformity with accounting principles generally accepted in the United States of America.</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><U>/s/ Moore Stephens CPA Limited</U></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">Moore Stephens CPA Limited</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">Certified Public Accountants</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">Hong Kong</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">August 14, 2015</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center">-F-1-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>


<!-- Field: Page; Sequence: 3 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc.</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Consolidated Balance Sheets</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center; border-bottom: Black 1pt solid">March 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">Note</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">2014</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">$ in thousands</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">$ in thousands</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-indent: -4.5pt; padding-left: 4.5pt">Assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 46%; text-align: left; text-indent: -4.5pt; padding-left: 9pt">Cash and cash equivalents</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">116</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">3,027</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Fixed deposits maturing over three months</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,049</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Trade receivables, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,480</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,306</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Other receivables, deposits and prepayments</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,781</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,154</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Receivable from affiliated party</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">166</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 9pt">Inventories</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,545</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,121</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;Financial instruments at fair value</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">391</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt; padding-bottom: 1pt">Income tax recoverable</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">1,740</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">39</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -4.5pt; padding-left: 9pt">Total current assets</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">14,877</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">9,038</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Investment in life insurance contract</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">131</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">136</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -4.5pt; padding-left: 4.5pt">Deposits</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">293</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Property, plant and equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 9pt">Buildings</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14,339</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17,056</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 9pt">Construction-in-progress</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,183</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">427</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Plant and machinery</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11,276</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,847</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Furniture, fixtures and equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,170</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,325</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt; padding-bottom: 1pt">Motor vehicles</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">589</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">572</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,557</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">29,227</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt; padding-bottom: 1pt">&nbsp;&nbsp;Less: accumulated depreciation and impairment</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(18,105</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(16,743</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Property, plant and equipment, net</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12,452</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12,484</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt; padding-bottom: 1pt">Intangible assets, net</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">6</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">4,387</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">4,119</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt; padding-bottom: 2.5pt">&nbsp;&nbsp;Total assets</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">32,140</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">25,777</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Liabilities and stockholders&rsquo; equity</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Bank overdrafts - secured</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">630</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Notes payable - secured</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,527</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,830</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,413</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,791</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Accrued charges and deposits</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,597</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,117</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Income tax liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Payable to affiliated parties</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">66</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Bank loans - secured</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,320</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,376</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;Financial instruments at fair value</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">119</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">84</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;Current portion of capital lease obligations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11</TD><TD STYLE="text-align: left">(a)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt; padding-bottom: 1pt">&nbsp;Loan from affiliated party - current portion</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">15</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">135</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -4.5pt; padding-left: 9pt">Total current liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">18,646</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">13,429</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Financial instruments at fair value - non current portion</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">208</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">112</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Capital lease obligations - non current portion</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11</TD><TD STYLE="text-align: left">(a)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">69</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">45</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Income tax liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,595</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt; padding-bottom: 1pt">Loan from affiliated party - non current portion</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">15</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">336</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Commitments and contingent liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Stockholders&rsquo; equity</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;&nbsp;Common stock par value $0.003 per share</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 9pt">- authorized shares - 23,333,334</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt">- issued shares: 2014 and 2015 - 5,577,639, <BR>- outstanding shares: 2014 and 2015 - 5,246,903</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;&nbsp;Additional paid-in capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">21,765</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">21,765</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;&nbsp;Treasury stock at cost: 2014 and 2015 - 330,736 shares</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,462</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,462</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;&nbsp;Accumulated deficit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(12,809</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(11,699</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt; padding-bottom: 1pt">&nbsp;&nbsp;Accumulated other comprehensive income</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">3,111</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">3,234</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1pt; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">10,622</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">11,855</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt; padding-bottom: 2.5pt">Total liabilities and stockholders&rsquo; equity</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">32,140</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">25,777</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD COLSPAN="13" STYLE="text-align: right"></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 1.5in; text-indent: 0.5in"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 1.5in; text-indent: 0.5in">See notes to these consolidated financial
statements</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; text-align: center; margin-bottom: 8pt">-F-2-</P>


<!-- Field: Page; Sequence: 4 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc. </B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Consolidated Statements of Operations
and Comprehensive (Loss) / Income</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="11" STYLE="text-align: center; vertical-align: top">Years ended March 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid">Note</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt; line-height: 107%">2013 <SUP>(A)</SUP></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt; line-height: 107%">2014 <SUP>(A)</SUP></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">$ in thousands</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">$ in thousands</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">$ in thousands</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 40%; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Net sales</TD><TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">19</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">30,386</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">31,305</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 10%; text-align: right">28,944</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt; padding-bottom: 1pt">Cost of sales</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(25,263</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(28,631</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(23,092</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Gross profit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,123</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,674</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,852</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Rental income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">45</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">708</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,453</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Selling expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(268</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(389</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(822</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Salaries and related costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,627</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,983</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(3,166</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Research and development expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(396</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(366</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(228</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Administration and general expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,402</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,964</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(3,245</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Other income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">120</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">520</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -4.5pt; padding-left: 4.5pt; padding-bottom: 1pt">Gain on disposal of property plant and equipment</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">2</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">3,595</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">98</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">(Loss) / income from operations</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">19</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(403</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">295</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">462</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Interest income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">64</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">18</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Interest expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(68</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(136</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(273</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt; padding-bottom: 1pt">Foreign exchange loss</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(261</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(444</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(134</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">(Loss) / income before income taxes</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(725</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(221</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">73</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt; padding-bottom: 1pt">Income tax (expense) / credit</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">8</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(29</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">1,037</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Net (loss) / income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(754</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(221</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,110</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Other comprehensive income, net of tax:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt">Foreign currency translation adjustments, net of tax</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">62</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">257</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">123</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt; padding-bottom: 2.5pt">Comprehensive (loss) / income</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">(692</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">36</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">1,233</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -4.5pt; padding-left: 4.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -4.5pt; padding-left: 5.4pt">Net (loss) / earnings per share</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">18</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt; padding-bottom: 2.5pt">- basic and diluted</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">(0.14</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">(0.04</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">0.21</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;<BR>Weighted average number of shares outstanding -</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt; padding-bottom: 2.5pt">- basic and diluted</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; padding-bottom: 2.5pt">18</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">5,246,903</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">5,246,903</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">5,246,903</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -4.5pt; padding-left: 9pt; width: 40%">&nbsp;</TD><TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="text-align: right; width: 10%">&nbsp;</TD><TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="text-align: right; width: 10%">&nbsp;</TD><TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="text-align: right; width: 10%">&nbsp;</TD><TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="text-align: left; width: 1%">&nbsp;</TD><TD STYLE="text-align: right; width: 10%">&nbsp;</TD><TD STYLE="text-align: left; width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -4.5pt; padding-left: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="17" STYLE="text-align: justify; padding-left: 5.4pt">Note A: Certain accounts in the consolidated statements of operations and comprehensive (loss) / income for the fiscal years ended March 31, 2013 and 2014 have been reclassified to conform with the presentation of that of the fiscal year ended March 31, 2015. <BR>&nbsp; <BR></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">See notes to these consolidated financial
statements</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">-F-3-</P>


<!-- Field: Page; Sequence: 5 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">Bonso Electronics International Inc.</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Consolidated Statements of Changes in
Stockholders&rsquo; Equity</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD COLSPAN="5" STYLE="text-align: center; border-bottom: Black 1pt solid">Common stock</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1pt solid">Treasury stock</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0">Stock</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">Issued</P></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0">Amount</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">outstanding</P></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0">Additional</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">paid-in</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">capital</P></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0">Treasury</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">Shares</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">held</P></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt"></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0">Amount</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">outstanding</P></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0">Accumulated</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">deficit</P></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0">Accumulated</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">other</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">comprehensive</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">income-foreign</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">currency</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">adjustments</P></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0">Total</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">stockholders&rsquo;</P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0">equity</P></TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in thousands</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in thousands</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in thousands</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in thousands</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in thousands</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in thousands</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 28%; text-align: justify">Balance, April 1, 2012</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; text-align: right">5,577,639</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; text-align: right">17</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; text-align: right">21,765</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; text-align: right">330,736</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; text-align: right">(1,462</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; text-align: right">(11,834</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; text-align: right">2,792</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 5%; text-align: right">11,278</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">Net loss</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(754</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(754</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-bottom: 1pt">Foreign exchange translation adjustment</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">62</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">62</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify">Balance, March 31, 2013</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,577,639</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">21,765</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">330,736</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,462</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(12,588</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,854</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,586</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">Net loss</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(221</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(221</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-bottom: 1pt">Foreign exchange translation adjustment</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">257</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">257</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify">Balance, March 31, 2014</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,577,639</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">21,765</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">330,736</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,462</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(12,809</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,111</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,622</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify">Net income</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,110</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,110</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-bottom: 1pt">Foreign exchange translation adjustment</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">123</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">123</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-bottom: 2.5pt">Balance, March 31, 2015</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">5,577,639</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">17</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">21,765</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">330,736</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">(1,462</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">(11,699</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">)</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">3,234</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">11,855</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">See notes to these consolidated financial
statements</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">-F-4-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify; border-bottom: Black 1pt solid">&nbsp;</P>


<!-- Field: Page; Sequence: 6 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/107% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc. </B></P>

<P STYLE="font: 10pt/107% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Consolidated Statements of Cash Flows</B></P>

<P STYLE="font: 10pt/107% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="11" STYLE="text-align: center; border-bottom: Black 1pt solid">Years Ended March 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2013 <SUP>(A)</SUP></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2014 <SUP>(A)</SUP></FONT></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">$ in thousands</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">$ in thousands</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">$ in thousands</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Cash flows from operating activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 46%; text-align: left; text-indent: -4.5pt; padding-left: 9pt">Net (loss) / income</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">(754</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">(221</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; text-align: right">1,110</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -4.5pt; padding-left: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">Adjustments to reconcile net (loss) / income to net cash provided by operating activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -4.5pt; padding-left: 13.5pt">Depreciation</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">120</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,086</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,082</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -4.5pt; padding-left: 13.5pt">Amortization</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">226</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">289</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">294</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Gain on disposal of property, plant and equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(3,595</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(98</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -4.5pt; padding-left: 9pt">&nbsp;Write-down of inventories</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">874</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">687</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">&nbsp;Write off of property, plant and equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,511</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">192</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Change in cash surrender value of life insurance contract</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(5</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(4</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(5</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">&nbsp;Change in fair value of financial instruments</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(35</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">419</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(132</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -4.5pt; padding-left: 13.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Changes in assets and liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Trade receivables</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(678</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">279</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,174</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Other receivables, deposits and prepayments</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(792</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(166</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">380</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Receivable from affiliated party</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(166</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Repayment from affiliated party</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">166</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -4.5pt; padding-left: 13.5pt">Inventories</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,355</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,959</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,737</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Income tax recoverable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(22</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Accounts payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,761</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,620</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(5,622</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Accrued charges and deposits</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(18</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">268</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">520</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Payable to affiliated parties</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">56</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt; padding-bottom: 1pt">Income tax liabilities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right">(37</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><td style="text-align: right">(894</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">Deferred income tax liabilities &nbsp; &nbsp; &nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(2</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"> &nbsp; &mdash;&nbsp;&nbsp; </TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"> &nbsp; &mdash;&nbsp;&nbsp; </TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 4.5pt">Net cash (used in) / provided by operating activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(593</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">245</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">2,647</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; text-align: left">Cash flows from investing activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -9pt; padding-left: 13.5pt">&nbsp;&nbsp;Proceeds from disposal of property, plant and equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">314</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">&nbsp;&nbsp;Acquisition of property, plant and equipment</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,412</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,778</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,105</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">&nbsp;&nbsp;Acquisition of intangible assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(802</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -0.6pt; padding-left: 9.05pt">&nbsp;Acquisition of financial instruments at fair value</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(390</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">&nbsp;&nbsp;Acquisition of fixed deposits</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,014</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,049</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt; padding-bottom: 1pt">&nbsp;&nbsp;Proceeds from maturity of fixed deposits</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">1,014</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">1,049</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding-bottom: 1pt; padding-left: 4.5pt">Net cash used in investing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(3,226</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(2,773</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">(132</TD><TD STYLE="padding-bottom: 1pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; text-align: left">Cash flows from financing activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9.35pt">&nbsp;&nbsp;Capital lease payments</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(28</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(24</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 13.5pt">&nbsp;Advance from notes payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,467</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,313</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,275</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9.35pt">&nbsp;&nbsp;Repayment of notes payable</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(6,061</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(7,062</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(6,972</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9.35pt">&nbsp;&nbsp;Advance from bank overdrafts</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">180</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">630</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.3pt; padding-left: 9.35pt">&nbsp;&nbsp;Repayment of bank overdrafts</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(180</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(630</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 9.35pt">&nbsp;&nbsp;Advance from bank loans</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,357</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">963</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,927</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.3pt; padding-left: 9.35pt">&nbsp;&nbsp;Repayment of bank loans</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,871</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.3pt; padding-left: 9.35pt; padding-bottom: 1pt">&nbsp;&nbsp;Net advance from loan from affiliated party</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">471</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.3pt; padding-left: 9.35pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left">Net cash provided by financing activities</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,943</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">1,636</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right">176</TD><TD STYLE="padding-bottom: 1pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -4.3pt; padding-left: 4.3pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.3pt; padding-left: 4.3pt">Net (decrease) / increase in cash and cash equivalents</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,876</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(892</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,691</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.3pt; padding-left: 4.3pt">Effect of exchange rate changes on cash and cash equivalents</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(132</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">220</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.3pt; padding-left: 4.3pt; padding-bottom: 1pt">Cash and cash equivalents, beginning of year</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">3,014</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">1,140</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">116</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.3pt; padding-left: 4.3pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.3pt; padding-left: 4.3pt; padding-bottom: 2.5pt">Cash and cash equivalents, end of year</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">1,140</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">116</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">3,027</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.3pt; padding-left: 4.3pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; text-align: left">Supplemental disclosure of cash flow information</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left">Cash paid during the year for:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 9pt">Interest</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">68</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">136</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">273</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding-left: 9pt">Income tax</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">90</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 9pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left">Income tax refund received</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">165</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left">&nbsp;<BR>Non-cash investing activities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -4.5pt; padding-left: 4.5pt">Property plant and equipment acquired under capital lease</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">120</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 11pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center; text-indent: 0.5in">&nbsp;</P>




<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-right: 0; text-align: left">Note A: Certain figures
in the consolidated statements of cash flows of the years ended March 31, 2013 and 2014 have been reclassified to conform
with the presentation of that of March 31, 2015.</P>

<P STYLE="font: 11pt/150% Times New Roman,serif; margin-top: 0; margin-right: 0; text-align: center"></P>

<P STYLE="font: 11pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center; text-indent: 0.5in">-F-5-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"></P>

<!-- Field: Page; Sequence: 7 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">&nbsp;<BR CLEAR="ALL">
<B>Bonso Electronics International Inc.</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>1</B></TD><TD STYLE="text-align: justify"><B>Description of business and significant accounting policies</B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">Bonso Electronics International Inc. and its subsidiaries (collectively, the &ldquo;Company&rdquo;
or &ldquo;Group&rdquo;) are engaged in the designing, manufacturing and selling of a comprehensive line of electronic scales and
weighing instruments, pet electronics products and other products.</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">The consolidated financial statements have been prepared in United States dollars and in accordance
with generally accepted accounting principles in the United States of America. The preparation of consolidated financial statements
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the dates of the consolidated financial statements and the reported amounts of revenues
and expenses during the reporting periods. Significant estimates made by management include valuation of inventories, allowance
for trade receivables and the impairment of long-lived assets. Actual results could differ from those estimates.</TD></TR>                                                                                                                          <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">The Company sustained an operating
loss in the fiscal year ended March 31, 2013, and operating income of approximately $295,000 and $462,000 in the fiscal years ended
March 31, 2014, and 2015, respectively. Notwithstanding the operating losses sustained in the fiscal year ended March 31, 2013
and the negative working capital as of March 31, 2014 and 2015, the accompanying consolidated financial statements have been prepared
on a going concern basis. With the unutilized banking facilities of approximately $4,232,000 (refer to note 7) available as of
March, 31, 2015 and the increase of gross profit from 8.5% during the fiscal year ended March 31, 2014 to 20.2% during the fiscal
year ended March 31, 2015, management believes the Company will have sufficient working capital to meet its financing requirements
based upon their experience and their assessment of the Company&rsquo;s projected performance, credit facilities and banking relationships.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">The significant accounting policies
are as follows:</TD></TR>
</TABLE>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>(a)</B></TD><TD STYLE="text-align: justify"><B>Principles of consolidation</B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">The consolidated financial statements include the financial statements of the Company and its subsidiaries
after elimination of inter-company accounts and transactions.</TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">Acquisitions of companies have been consolidated from the date on which control of the net assets
and operations was transferred to the Company.</TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">Acquisitions of companies are accounted for using the purchase method of accounting.</TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>(b)</B></TD><TD STYLE="text-align: justify"><B>Cash and cash equivalents</B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">Cash and cash equivalents are short-term, highly liquid investments with original maturities of
three months or less. Cash equivalents are stated at cost, which approximates fair value because of the short-term maturity of
these instruments.</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center">-F-6-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"></P>

<!-- Field: Page; Sequence: 8 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center">&nbsp;</P>




<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc. </B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>1</B></TD><TD STYLE="text-align: justify"><B>Description of business and significant accounting policies (Continued)</B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>(c)</B></TD><TD STYLE="text-align: justify"><B>Inventories </B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">Inventories are stated at the lower of cost, as determined on a first-in, first-out basis, or market.
Costs of inventories include purchase and related costs incurred in bringing the products to their present location and condition.
Market value is determined by reference to the selling price after the balance sheet date or to management estimates based on prevailing
market conditions. The Company routinely reviews its inventories for their salability and for indications of obsolescence to determine
if inventory carrying values are higher than market value. Some of the significant factors the Company considers in estimating
the market value of its inventories include the likelihood of changes in market and customer demand and expected changes in market
prices for its inventories.</TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>(d)</B></TD><TD STYLE="text-align: justify"><B>Trade receivables</B></TD></TR>                                                                                                                                    <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Trade receivables are recorded
at the invoiced amount, net of allowances for doubtful accounts and sales returns. The allowance for doubtful accounts is the Company&rsquo;s
best estimate of the amount of probable credit losses in the Company&rsquo;s existing trade receivables. Bad debt expense is included
in the administrative and general expenses.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">The Company recognizes an allowance
for doubtful receivables to ensure accounts and other receivables are not overstated due to uncollectibility. Allowance for doubtful
receivables is maintained for all customers based on a variety of factors, including the length of time the receivables are past
due, significant one-time events and historical experience. An additional allowance for individual accounts is recorded when the
Company becomes aware of customers&rsquo; or other debtors&rsquo; inability to meet their financial obligations, such as bankruptcy
filings or deterioration in the customer&rsquo;s or other debtor&rsquo;s operating results or financial position. If circumstances
related to customers or debtors change, estimates of the recoverability of receivables will be further adjusted.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD><B>(e)</B></TD><TD STYLE="text-align: justify">&nbsp;<B></B> <B>Income taxes and deferred income taxes</B></TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Amounts in the consolidated financial
statements related to income taxes are calculated using the principles of Accounting Standards Codification (&ldquo;ASC&rdquo;)
740 and Accounting Standards Updates (&ldquo;ASU&rdquo;) 2013-11 <I>&ldquo;Presentation of an Unrecognized Tax Benefit When a Net
Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists&rdquo;</I>. ASC 740 requires recognition of
deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial
statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the temporary differences
between the financial reporting bases and tax bases of assets and liabilities using enacted tax rates in effect for the year in
which the differences are expected to reverse. Future tax benefits, such as net operating loss carry forwards, are recognized as
deferred tax assets. Recognized deferred tax assets are reduced by a valuation allowance if, based on the weight of available evidence,
it is more likely than not that some portion or all of the deferred tax assets will not be realized.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">The Company complies with ASC 740 <I>&ldquo;Income Taxes&rdquo;</I> for uncertainty in income taxes recognized in financial statements.
ASC 740 prescribes a recognition threshold and measurement attributes for the financial statement recognition and measurement
of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification,
interest and penalties, accounting in interim periods, disclosure and transition. The Company&rsquo;s accounting policy is to
treat interest and penalties as components of income taxes.</TD></TR>
</TABLE>










<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; text-align: center; margin-bottom: 8pt">-F-7-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-right: 0; border-bottom: Black 1pt solid; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; letter-spacing: -0.1pt; text-align: justify; text-indent: 0in"><FONT STYLE="letter-spacing: 0pt">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 9 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; letter-spacing: -0.1pt; text-align: justify"><FONT STYLE="letter-spacing: 0pt"></FONT></P>




<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc. </B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>1</B></TD><TD STYLE="text-align: justify"><B>Description of business and significant accounting policies (Continued)</B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>(f)</B></TD><TD STYLE="text-align: justify"><B>Lease prepayments and intangible assets</B></TD></TR>                                                                                                                                                          <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Lease prepayments represent the cost
of land use rights in the People&rsquo;s Republic of China (&ldquo;PRC&rdquo;). Land use rights held by the Company are included
in intangible assets. The granted useful life of the land use rights is 50 years. They are stated at cost and amortized on a straight-line
basis over the period of a maximum of 30 years, in accordance with the business licenses of 30 years.</TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>(g)</B></TD><TD STYLE="text-align: justify"><B>Property, plant and equipment</B></TD></TR>                                                                                                                                                <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman,serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 8%">&#9;(i)&#9;</TD>
    <TD STYLE="width: 84%">Property,
plant and equipment are stated at cost less accumulated depreciation. Leasehold land and buildings are depreciated on a straight-line
basis over 15 to 50 years, representing the shorter of the remaining term of the lease or the expected useful life to the Company.</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&#9;(ii)&#9;</TD>
    <TD>Other
categories of property, plant and equipment are carried at cost and depreciated using the straight-line method over their expected
useful lives to the Company. The principal Oestimated useful lives for depreciation are:</TD></TR>
</TABLE>





<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="font: 10pt Times New Roman,serif; border-collapse: collapse; width: 68%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD STYLE="width: 53%">&#9;Plant and machinery </TD>
    <TD STYLE="width: 15%">- 10 years</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD>&#9;Furniture, fixtures
and equipment&#9;</TD>
    <TD>- 5 to 10 years</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: rgb(204,238,255)">
    <TD>&#9;Motor vehicles&#9;</TD>
    <TD>- 5 years</TD></TR>
<TR STYLE="vertical-align: top; text-align: left; background-color: White">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 1in; text-align: justify; text-indent: -1in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman,serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 8%">&#9;(iii)</TD>
    <TD STYLE="width: 84%">Assets
under construction are not depreciated until construction is completed and the assets are ready for their intended use.</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>(iv)&#9;</TD>
    <TD>The cost
of major improvements and betterments is capitalized, whereas the cost of maintenance and repairs is expensed in the year when
they are incurred.</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&#9;(v)&#9;</TD>
    <TD>Any gain
or loss on disposal is included in the consolidated statements of operations and comprehensive (loss) / income.</TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 1in; text-align: justify; text-indent: -1in"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center">-F-8-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1in"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>






<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"></P>

<!-- Field: Page; Sequence: 10 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc. </B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>1</B></TD><TD STYLE="text-align: justify"><B>Description of business and significant accounting policies (Continued)</B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>(h)</B></TD><TD STYLE="text-align: justify"><B>Impairment of long-lived assets including intangible assets</B></TD></TR>                                                                                                                                                                              <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Long-lived assets held and used by
the Company and intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount of such assets may not be recoverable. The Company evaluates recoverability of assets to be held and used by comparing the
carrying amount of an asset to future net undiscounted cash flows to be generated by the asset. If such assets are considered to
be impaired, the impairment loss is measured by the amount by which the carrying amount of the assets exceeds the fair value of
the assets calculated using a discounted future cash flows analysis. Provisions for impairment made on other long-lived assets
are disclosed in the consolidated statements of operations and comprehensive (loss) / income. Since the fiscal year ended March
31, 2014, the Company has transferred all its production process to the factory in Xinxing, PRC, and the factory in Shenzhen was
leased out to a third party. As a result, the Company performed an assessment of the value of the land, buildings and intangible
assets of the factories in Shenzhen and Xinxing, PRC, and no provision for impairment was made by the Company (2014: $nil; 2013:
$nil) based on the assessment.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>(i)</B></TD><TD STYLE="text-align: justify"><B>Capital and operating leases</B></TD></TR>                                                                                                                                                                                                                                                                                                                                                                                                                   <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Costs in respect of operating leases
are charged against income on a straight-line basis over the lease term. Leasing agreements, which transfer to the Company substantially
all the benefits and risks of ownership of an asset, are treated as if the asset had been purchased outright. The assets are included
in property, plant and equipment (&ldquo;capital leases&rdquo;) and the capital element of the lease commitments is shown as an
obligation under capital leases. The lease rentals are treated as consisting of capital and interest elements. The capital element
is applied to reduce the outstanding obligation and the interest element is charged against profit so as to give a consistent periodic
rate of charge on the remaining balance outstanding at the end of each accounting period. Assets held under capital leases are
depreciated over the useful lives of the equivalent owned assets or the lease term, whichever is shorter.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>(j)</B></TD><TD STYLE="text-align: justify"><B>Revenue recognition</B></TD></TR>                                                                                                                                      <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">No revenue is recognized unless there
is persuasive evidence of an arrangement, the price to the buyer is fixed or determinable, delivery has occurred and collectibility
of the sales price is reasonably assured. Revenue is recognized when title and risk of loss are transferred to customers, which
is generally the point at which products are leaving the ports of Hong Kong, or Shenzhen or Nansha (Guangzhou) as designated by
our customers. &nbsp;Shipping costs billed to the Company&rsquo;s customers are included within revenue. Associated costs are classified
as part of cost of sales.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">The Company provides to certain customers
an additional one to two percent of the quantity of certain products ordered in lieu of a warranty, which is recognized as cost
of sales when these products are shipped to customers from the Company&rsquo;s facilities. In addition, certain products sold by
the Company are subject to a limited product quality warranty. The Company accrues for estimated incurred but unidentified quality
issues based upon historical activity and known quality issues if a loss is probable and can be reasonably estimated. During the
fiscal year ended March 31, 2015, the Company recorded $nil for such accrual (2014: $nil, 2013: $nil). The standard limited warranty
period is one to three years. Quality returns, refunds, rebates and discounts are recorded net of sales at the time of sale and
estimated based on past history. All sales are based upon firm orders with fixed terms and conditions, which generally cannot be
modified. Historically, the Company has not experienced material differences between its estimated amounts of quality returns,
refunds, rebates and discounts and the actual results. In all contracts, there is no price protection or similar privilege in relation
to the sale of goods.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Rental income is recognized according
to the rental agreements. Rental income for non-uniform rent payments is recognized on a straight-line basis throughout the lease
term.</TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center">-F-9-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>


<!-- Field: Page; Sequence: 11 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc. </B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>1</B></TD><TD STYLE="text-align: justify"><B>Description of business and significant accounting policies</B> <B>(Continued)</B></TD></TR>                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD><B>(k)</B></TD><TD STYLE="text-align: justify"> <B>Research and development costs&nbsp;</B></TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Research and development costs include
salaries, utilities and contractor fees that are directly attributable to the conduct of research and development progress primarily
related to the development of new design of products. Research and development costs are expensed in the financial period in which
they are incurred.</TD></TR>
</TABLE>





<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>(l)</B></TD><TD STYLE="text-align: justify"><B>Advertising</B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">Advertising costs are expensed as incurred and are included within selling expenses. Advertising
costs were approximately $26,000, $16,000 and $9,000 for the fiscal years ended March 31, 2013, 2014 and 2015, respectively.</TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>(m)</B></TD><TD STYLE="text-align: justify"><B>Foreign currency translations</B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt">                                                                                                                                                                                                                                                                                                                                                                                                               <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD>&#9;(i)&#9;</TD><TD STYLE="text-align: justify">The Company&rsquo;s
functional currency is the United States dollar. The financial statements of foreign subsidiaries where the United States dollar
is the functional currency and which have transactions denominated in non-United States dollar currencies are translated into United
States dollars at the exchange rates existing on that date. The translation of local currencies into United States dollars creates
transaction adjustments which are included in net (loss) / income. Exchange differences are recorded in the statements of operations
and comprehensive (loss) / income</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(ii)</TD><TD STYLE="text-align: justify">The financial statements of foreign subsidiaries, where non-United States dollar currencies are
the functional currencies, are translated into United States dollars using exchange rates in effect at period end for assets and
liabilities and average exchange rates during each reporting period for statement of operations. Adjustments resulting from translation
of these financial statements are reflected as a separate component of stockholders&rsquo; equity in accumulated other comprehensive
income.</TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>(n)</B></TD><TD STYLE="text-align: justify"><B>Stock options and warrants</B></TD></TR>                                                                                                                                             <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Stock options have been granted to
employees, directors and non-employee directors. Upon exercise of the options, a holder can acquire shares of common stock of the
Company at an exercise price determined by the board of directors. The options are exercisable based on the vesting terms stipulated
in the option agreements or plan.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">The Company follows the guidance of
ASC 718, &ldquo;<I>Accounting for Stock Options and Other Stock-Based Compensation.</I>&rdquo; ASC 718 requires companies to record
compensation expense for share-based awards issued to employees and directors in exchange for services provided. The amount of
the compensation expense is based on the estimated fair value of the awards on their grant dates and is recognized over the required
service periods. Our share-based awards include stock options and restricted stock awards. The estimated fair value underlying
our calculation of compensation expense for stock options is based on the Black-Scholes pricing model. Forfeitures of share-based
awards are estimated at the time of grant and revised, if necessary, in subsequent periods if our estimates change based on the
actual amount of forfeitures we have experienced.</TD></TR>
</TABLE>



<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center">-F-10-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>


<!-- Field: Page; Sequence: 12 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc. </B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>1</B></TD><TD STYLE="text-align: justify"><B>Description of business and significant accounting policies</B> <B>(Continued)</B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>(o)</B></TD><TD STYLE="text-align: justify"><B>Recent accounting pronouncements </B></TD></TR>                                                                                                                                                    <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">In April 2014, the Financial Accounting
Standards Board (&ldquo;FASB&rdquo;) issued ASU 2014-08, &ldquo;<I>Presentation of Financial Statements (Topic 205) and Property,
Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity</I>&rdquo;
(&quot;ASU 2014-08&quot;). ASU 2014-08 amends the definition of a discontinued operation and requires entities to provide additional
disclosures for both discontinued operations and disposal transactions that do not meet the discontinued-operations criteria. It
is effective for annual periods beginning on or after December 15, 2014. We do not expect the adoption of this guidance to have
a material effect on our consolidated financial statements.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">In May 2014, the FASB issued ASU 2014-09,
<I>&ldquo;Revenue from Contracts with Customers&rdquo; </I>(&quot;ASU 2014-09&quot;). The objective of this Update is to remove
inconsistencies and weaknesses in revenue requirements, and to simplify the preparation of financial statements by reducing the
number requirements to which an entity must refer. The new standard supersedes virtually all present U.S. GAAP guidance on revenue
recognition and requires the use of more estimates and judgments than the present standards, as well as additional disclosures.
The FASB has voted to approve a one-year deferral of the effective date from January 1, 2017 to January 1, 2018, while allowing
for early adoption as of January 1, 2017. The Company is currently evaluating the impact this Update will have on its consolidated
financial statements.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">In June 2014, the FASB issued ASU 2014-12, <I>&ldquo;Compensation &ndash; Stock Compensation (Topic 718): Accounting for Share-Based
Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period&rdquo;</I>
(&ldquo;ASU 2014-12&rdquo;). The amendments in ASU 2014-12 require that a performance target that affects vesting and that could
be achieved after the requisite service period be treated as a performance condition. The amendments in this ASU are effective
for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period, with early
application permitted. Companies may use either a prospective or a retrospective approach to adopt this ASU and the Company is
currently evaluating which transition approach to use. The Company is evaluating the new pronouncement to determine the impact
it may have to its consolidated financial statements.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">In August 2014, the FASB issued ASU
2014-15, &ldquo;<I>Disclosure of Uncertainties about an Entity&rsquo;s Ability to Continue as a Going Concern&rdquo;</I>, which
provides guidance on determining when and how to disclose going-concern uncertainties in the financial statements. The new standard
requires management to perform interim and annual assessments of an entity&rsquo;s ability to continue as a going concern within
one year of the date the financial statements are issued. An entity must provide certain disclosures if conditions or events raise
substantial doubt about the entity&rsquo;s ability to continue as a going concern. The ASU applies to all entities and is effective
for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. The Company is
currently evaluating the impact this Update will have on its consolidated financial statements.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">In January 2015, the FASB issued ASU 2015-01, <I>&ldquo;Income Statement &ndash; Extraordinary and Unusual Items (Subtopic 225-20):
Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items&rdquo;</I> (&rdquo;ASU 2015-01&rdquo;).
The amendments in ASU 2015-01 eliminate from U.S. GAAP the concept of extraordinary items. The amendments in this ASU are effective
for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period, with early
application permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. Companies may use
either a prospective or a retrospective approach to adopt this ASU and the Company is currently evaluating which transition approach
to use. The adoption of ASU 2015-01 is not expected to have a material impact on the Company&rsquo;s consolidated financial statements.</TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center">&nbsp;<BR>-F-11-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-indent: -0.5in">&nbsp;</P>


<!-- Field: Page; Sequence: 13 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Bonso Electronics International Inc. </B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>1</B></TD><TD STYLE="text-align: justify"><B>Description of business and significant accounting policies</B> <B>(Continued)</B></TD></TR>                                                                                                                                                                                               <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD><B>(o)</B></TD><TD STYLE="text-align: justify"><B>Recent accounting pronouncements (Continued)</B></TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">In February 2015, the FASB issued ASU 2015-02, <I>&ldquo;Consolidation (Topic 810): Amendments to the Consolidation Analysis&rdquo;</I>
(&ldquo;ASU 2015-02&rdquo;). The amendments in ASU 2015-02 change the analysis that a reporting entity must perform to determine
whether it should consolidate certain types of legal entities. The amendments in this ASU are effective for public business entities
for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted,
including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should
be reflected as of the beginning of the fiscal year that includes that interim period. A reporting entity may apply the amendments
in this ASU using a modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning of
the fiscal year of adoption. A reporting entity also may apply the amendments retrospectively. The adoption of ASU 2015-02 is not
expected to have a material impact on the Company&rsquo;s consolidated financial statements.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">In April 2015, the FASB issued ASU
2015-03, <I>&ldquo;Simplifying the Presentation of Debt Issuance Costs,&rdquo;</I> (&ldquo;ASU 2015-03&rdquo;) which changes the
presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs in the balance
sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs will continue to
be reported as interest expense. The guidance is effective for fiscal years beginning after December 15, 2015, with early adoption
permitted. The adoption of ASU 2015-03 is not expected to have a material impact on the Company&rsquo;s consolidated financial
statements or disclosures.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">In April 2015, the FASB issued ASU 2015-05, &ldquo;<I>Customer&rsquo;s Accounting for Fees Paid in a Cloud Computing Arrangement</I>&rdquo;
(&ldquo;ASU 2015-05&rdquo;) (an update to Subtopic 350-40, Intangibles - Goodwill and Other - Internal-Use Software), which provides
guidance on accounting for cloud computing fees. If a cloud computing arrangement includes a software license, then the customer
should account for the license element of the arrangement consistent with the acquisition of other software licenses. If a cloud
computing arrangement does not include a software license, the arrangement should be accounted for as a service contract. This
ASU is effective for arrangements entered into, or materially modified, in interim and annual periods beginning after December
15, 2015. Retrospective application is permitted but not required. The adoption of ASU 2015-05 is not expected to have a material
impact on the Company&rsquo;s consolidated financial statements or disclosures.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">In May 2015, the FASB issued ASU 2015-07, <I>&ldquo;Fair Value Measurement: Disclosures for Investments in Certain Entities That
Calculate Net Asset Value per Share (or Its Equivalent)&rdquo;</I> (&ldquo;ASU 2015-07&rdquo;), which removes the requirement
to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share
practical expedient. The ASU also removes the requirement to make certain disclosures for all investments that are eligible to
be measured at fair value using the net asset value per share practical expedient. Rather, those disclosures are limited to investments
for which the entity has elected to measure the fair value using that practical expedient. This ASU is effective for arrangements
entered into, or materially modified, in interim and annual periods beginning after December 15, 2015. Retrospective application
is permitted but not required. The Company is currently evaluating the impact of this ASU on the consolidated financial statements.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">We believe there is no additional new accounting guidance adopted, but not yet effective that is relevant to the readers of our
financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant
impact on our financial reporting.</TD></TR>
</TABLE>





<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center">-F-12-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><BR></P>


<!-- Field: Page; Sequence: 14 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">Bonso Electronics International Inc.</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>2</B></TD><TD STYLE="text-align: justify"><B>Allowance for doubtful accounts</B></TD></TR>                                                                                                                                                <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Allowance for doubtful accounts amounted
to $1,415,000 as of March 31, 2014 and 2015. The Company believed that the recoverability was doubtful, and continued to include
this amount in allowance for doubtful accounts as of March 31, 2014 and 2015.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Most of the Company&rsquo;s trade
receivables are generally unsecured, except for two customers with receivables covered by credit insurance under a factoring agreement.</TD></TR>
</TABLE>


<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><B></B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>3</B></TD><TD STYLE="text-align: justify"><B>Inventories</B></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">The components of inventories as of March 31, 2014 and 2015 are as follows:</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 70%; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2014</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2015</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in thousands</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in thousands</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 26%; text-align: left; text-indent: -11pt; padding-left: 11pt">Raw materials</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; text-align: right">5,137</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; text-align: right">1,978</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -44pt; padding-left: 44pt">Work in progress</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,229</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">676</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -44pt; padding-left: 44pt; padding-bottom: 1pt">Finished goods</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">179</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">467</TD><TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD></TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%"></FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%"></FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">7,545</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">3,121</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify">During the fiscal year ended March
31, 2014 and 2015, based upon material composition and expected usage, provision for inventories of approximately $874,000 and
$687,000, respectively, were charged to the consolidated statements of operations under cost of sales.</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center">-F-13-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify">&nbsp;</P>


<!-- Field: Page; Sequence: 15 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">Bonso Electronics International Inc.</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>4</B></TD><TD STYLE="text-align: justify"><B>Property, plant and equipment, net</B></TD></TR>                                                                                                                                                   <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">During the fiscal years ended March
31, 2013, 2014 and 2015, depreciation expenses charged to the consolidated statements of operations amounted to approximately $120,000,
$1,086,000 and $1,082,000 respectively. As at March 31, 2014 and 2015, fully depreciated assets that were still in use by the Company
amounted to $10,122,000 and $9,550,000, respectively.</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Property, plant and equipment in Shenzhen
and Xinxing were assessed for impairment according to the policy described in note 1(h). The Company concluded that no impairment
to property, plant and equipment in Shenzhen and Xinxing were required for the fiscal years ended March 31, 2014 and 2015.</TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>5</B></TD><TD STYLE="text-align: justify"><B>Interests in subsidiaries</B></TD></TR>                                                                                                                                          <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">Particulars of principal subsidiaries as of March 31, 2014
and 2015 are as follows:</TD></TR>
</TABLE>


<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid">Name of company</TD><TD></TD>
    <TD><P STYLE="font: 10pt Times New Roman,serif; margin: 0 0 8pt"></P> <P STYLE="font: 10pt Times New Roman,serif; margin: 0 0 8pt"> </P> <P STYLE="margin-top: 0; margin-right: 0; margin-left: 0">Place
                                         of<U> </U>incorpration and<U> </U>kind of<U> </U><BR><U>legal entity</U></P></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right"><P STYLE="font: 10pt Times New Roman,serif; margin: 0 0 8pt; text-align: right"></P> <P STYLE="font: 10pt Times New Roman,serif; margin: 0 0 8pt; text-align: left">&nbsp;</P>
                                                                                                                       <P STYLE="font: 10pt Times New Roman,serif; margin-top: 0; margin-right: 0; margin-left: 0; text-align: left">Particulars of issued capital <U>registered
                                                                                                                                                                                                                                        capital</U></P></TD><TD>&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center; vertical-align: bottom"><FONT STYLE="font-size: 10pt">Percentage of capital<BR> <U>held by the Company</U></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">Principal activities</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid">2014</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 15%; text-align: left; padding-left: 5.4pt; vertical-align: top">Bonso Electronics Limited * <BR>(&ldquo;BEL&rdquo;)</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 15%; text-align: left; padding-left: 5.4pt; vertical-align: top">Hong Kong, <BR>limited liability company</TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 15%; text-align: left; padding-left: 5.4pt; vertical-align: top">HK$5,000,000 (US$641,026) <BR></TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: center; vertical-align: top">100%</TD><TD STYLE="width: 1%; text-align: left"></TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; text-align: center; vertical-align: top">100%</TD><TD STYLE="width: 1%; text-align: left"></TD><TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 15%; text-align: left; text-indent: -0.05in; padding-left: 0.05in">Investment holding, providing management and administrative support to the Group companies</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-indent: -3.7pt; padding-left: 3.7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Bonso Investment Limited <BR>(&ldquo;BIL&rdquo;) <BR></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">Hong Kong, <BR>limited liability company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">HK$3,000,000 (US$384,615) <BR></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; text-indent: -3.7pt; padding-left: 3.7pt; vertical-align: top">Investment holding</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-indent: -3.7pt; padding-left: 3.7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Bonso Electronics (Shenzhen) Company, Limited <BR>(&ldquo;BESCL&rdquo;) <BR></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">PRC, <BR>limited liability company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">US$12,621,222 <BR>&nbsp; <BR></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; text-indent: -3.7pt; padding-left: 3.7pt; vertical-align: top">Investment holding</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-indent: -3.7pt; padding-left: 3.7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">Bonso Advanced Technology Limited * <BR>(&ldquo;BATL&rdquo;)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">Hong Kong, <BR>limited liability company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">HK$1,000,000 <BR>(US$128,205)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD></TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; text-indent: -3.7pt; padding-left: 3.7pt">Investment holding, and trading of scales and pet electronics products</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-indent: -3.7pt; padding-left: 3.7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Bonso Advanced Technology (Xinxing) Company, Limited <BR>(&ldquo;BATXXCL&rdquo;)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">PRC, <BR>limited liability company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">US$10,000,000</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; text-indent: -3.7pt; padding-left: 3.7pt; vertical-align: top">Production of scales and pet electronics products</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-indent: -3.7pt; padding-left: 3.7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Bonso Technology (Shenzhen) Company, Limited <BR>(&ldquo;BTL&rdquo;)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">PRC, <BR>limited liability company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">HK$200,000 <BR></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; text-indent: -3.7pt; padding-left: 3.7pt; vertical-align: top">Product development</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-indent: -3.7pt; padding-left: 3.7pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt">Xinxing An Bang Metal and Plastic Manufacturing Company Limited <BR>(&ldquo;ANB&rdquo;)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">PRC, <BR>limited liability company</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; padding-left: 5.4pt; vertical-align: top">HK$500,000</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center; vertical-align: top">100%</TD><TD STYLE="text-align: left"></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left; text-indent: -3.7pt; padding-left: 3.7pt">Employs workers for assembly of scales and pet electronics products</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-indent: -3.7pt; padding-left: 3.7pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify">* Shares directly held by the Company</TD></TR></TABLE>




<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">-F-14-</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center; border-bottom: Black 1pt solid">&nbsp;</P>

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">&nbsp;</P>

<!-- Field: Page; Sequence: 16 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"></P>

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center">Bonso Electronics International Inc.</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><B>(Expressed in United States Dollars)</B></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"><B>6</B></TD><TD STYLE="text-align: justify"><B>Intangible assets</B></TD></TR>                                                                                                                                  <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;Intangible assets are analyzed as follows:</TD></TR>
</TABLE>




<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="margin-left: 0.5in; border-collapse: collapse; width: 70%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center">March 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">2014</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">$ in thousands</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">$ in thousands</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="3" STYLE="text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 26%; text-indent: -3pt; padding-left: 3pt; text-align: left; vertical-align: top">Cost</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; text-align: right">6,894</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; text-align: right">6,939</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -3pt; padding-left: 3pt; padding-bottom: 1pt">Less: accumulated amortization</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(2,507</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">(2,820</TD><TD STYLE="text-align: left; padding-bottom: 1pt">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -3pt; padding-left: 3pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%"></FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%"></FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -3pt; padding-left: 3pt; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">4,387</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">4,119</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify">The components of other intangible
assets are as follows:</P>


<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="margin-left: 0.5in; border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-family: Times New Roman,serif">&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="7" STYLE="text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">March 31,</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-family: Times New Roman,serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2014</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-family: Times New Roman,serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$ in thousands</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">$ in thousands</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-family: Times New Roman,serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 56%; text-align: left; text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Land
    use right of factory land in Shenzhen, Guangdong, PRC</FONT></TD><TD STYLE="width: 4%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 14%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2,062</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="width: 14%; text-align: right"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">1,880</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -3pt; padding-left: 3pt; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Land
    use right of factory land in Xinxing, Guangdong, PRC</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2,325</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">2,239</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-family: Times New Roman,serif; text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-family: Times New Roman,serif; text-indent: -3pt; padding-left: 3pt; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4,387</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4,119</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></TD></TR>
</TABLE>



<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">Amortization
expense in relation to other intangible assets was approximately $226,000, $289,000 and $294,000 for each of the fiscal years
ended March 31, 2013, 2014 and 2015, respectively.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">As
of March 31, 2015, future minimum amortization expenses in respect of other intangible assets are as follows:</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 45%; margin-left: 0.5in; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: top; width: 30%; padding-right: 5.4pt; padding-left: 5.4pt"><P STYLE="font: 10pt/107% Times New Roman,serif; margin: 0 0 8pt"></P>
        <P STYLE="font: 10pt/107% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt">Year ending March 31,</FONT></P></TD>
    <TD STYLE="vertical-align: bottom; width: 15%; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; text-align: right; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">$
    <FONT STYLE="letter-spacing: -0.1pt">in thousands</FONT></FONT></TD></TR>
<TR>
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; text-align: right; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: rgb(204,238,255)">
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">2016</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; text-align: right; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">294</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">2017</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; text-align: right; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">294</FONT></TD></TR>
<TR STYLE="background-color: rgb(204,238,255)">
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">2018</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; text-align: right; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">294</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">2019</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; text-align: right; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">294</FONT></TD></TR>
<TR STYLE="background-color: rgb(204,238,255)">
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">2020</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; text-align: right; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">294</FONT></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-bottom: 1pt; padding-left: 5.4pt; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt; line-height: 107%">Thereafter
    </FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 5.4pt; padding-bottom: 1pt; padding-left: 5.4pt; text-align: right; line-height: 107%; font-family: Times New Roman,serif; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt; line-height: 107%">2,649</FONT></TD></TR>
<TR STYLE="background-color: rgb(204,238,255)">
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 5.4pt; padding-bottom: 8pt; padding-left: 5.4pt; text-align: right; line-height: 107%; font-family: Times New Roman,serif"></TD></TR>
<TR STYLE="background-color: White">
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-bottom: 2.5pt; padding-left: 5.4pt; line-height: 107%; font-family: Times New Roman,serif"><FONT STYLE="font-size: 10pt">Total</FONT></TD>
    <TD STYLE="vertical-align: bottom; padding-right: 5.4pt; padding-bottom: 2.5pt; padding-left: 5.4pt; text-align: right; line-height: 107%; font-family: Times New Roman,serif; border-bottom: Black 3pt double"><FONT STYLE="font-size: 10pt">4,119</FONT></TD></TR>
</TABLE>



<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-15-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"></P>

<!-- Field: Page; Sequence: 17 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc. </B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>7</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Banking
                                         facilities</B></FONT></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">As of March 31, 2015, the Company
                              had general banking facilities for bank overdrafts, letters of credit, notes payable, factoring
                              and term loans. The facilities are interchangeable with total amounts available of $9,438,000 (2014:
                              $10,698,000). The general banking facilities utilized by the Company are denominated in United States
                              dollars, Hong Kong dollars and Chinese Yuan.</FONT></TD></TR>                                   <TR STYLE="vertical-align: top">
<TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top">
<TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The Company&rsquo;s general banking facilities, expressed
               in United States dollars, are further detailed as follows:</FONT></TD></TR>
</TABLE>





<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman,serif; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Amount
    available</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman,serif; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Amount
    utilized</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman,serif; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Amount
    unutilized</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman,serif; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Terms
    of banking <BR>facilities as of</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">March 31,</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">March 31,</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">March 31,</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">March 31, 2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">Interest</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">Repayment</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman,serif; text-align: center"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">rate</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">terms</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: bold 10pt Times New Roman,serif; text-align: justify; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Import
    and export&nbsp;&nbsp;facilities</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: bold 10pt Times New Roman,serif; text-align: justify; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 10%; font: 10pt Times New Roman,serif; text-align: justify; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Combined
    limit</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">6,154</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">2,564</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 7%; font: 10pt Times New Roman,serif; text-align: right; padding-left: 0.5in"><FONT STYLE="font-size: 10pt">3,703</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 7%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,830</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 7%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">2,451</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 7%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">734</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 9%; font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 9%; font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Including
    sub-limit of:</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Notes
    payable</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">4,487</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">2,308</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">2,527</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,830</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,960</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">478</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">HIBOR*
    +2.5%</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Repayable
    in full within 120 days</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Bank overdrafts</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">641</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">641</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">630</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">11</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">641</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Prime rate
    <BR>+ 1%</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Repayable
    on demand</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Factoring</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">2,400</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">2,400</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">546</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,854</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">2,400</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">HIBOR*
    +1.5%</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Repayable
    in 60 days</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: bold 10pt Times New Roman,serif; text-align: left; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Other
    facilities</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: bold 10pt Times New Roman,serif; text-align: left; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Export Documentary
    Credits</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,923</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">641</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,923</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">641</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">Short Term
    <BR> Loans</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,026</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right">3,547<FONT STYLE="font-size: 10pt"></FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt"></FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right">1,026<FONT STYLE="font-size: 10pt"></FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,026</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">2,521</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">(Note
    A)</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt"> Revolving loan  repayable in 30 days</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 1.4pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman,serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 1.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt; line-height: 150%">Long
    Term Loans <SUP>(1)</SUP></FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">1,595</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid">2,686</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">748</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2,350</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">847</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">336</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">(Note
    A)</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; padding-left: 1.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Term
    loans are repayable <BR>monthly over  3-years</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; padding-left: 1.4pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">10,698</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">9,438</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">5,477</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">5,206</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">5,221</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">4,232</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; padding-left: 1.4pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/107% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">Note
A: HIBOR* +2.25% for loans in Hong Kong. People's Bank of China&rsquo;s loan benchmark interest rate times 110% for loans in PRC.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">(1)
A clause in the banking facilities states that the term loans are subject to review any time and also subject to the bank's overriding
right of repayment on demand, including the right to call for cash cover on demand for prospective and contingent liabilities.
Therefore, all long-term loans were classified as current liabilities in the consolidated balance sheets.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-indent: 35.95pt"><FONT STYLE="font-size: 10pt">* HIBOR
is the Hong Kong Interbank Offer Rate</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-indent: 35.95pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; text-align: center; margin-bottom: 8pt"><FONT STYLE="font-size: 10pt">-F-16-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; text-align: center; margin-bottom: 8pt; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 18 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc.</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>7</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Banking
                                         facilities (continued)</B></FONT></TD></TR></TABLE>



<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">As
of March 31, 2015, a treasury product facility of approximately $25,738,000 (2014: $25,738,000) was made available to the Company
for transactions of financial instruments including forward contracts, and approximately $2,000,000 (2014: $2,000,000) of the
facility was utilized.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">One
of the properties of the Company located in Hong Kong with net book value of approximately $990,000 and the rental assignment
over such property, the rights, interests and benefits of a life insurance contract with book value of approximately $136,000,
and a land use right and factory building located in Xinxing, PRC with net book value of approximately $3,550,000 are arranged
as securities to the banks for the banking facilities arrangement. Refer to note 20 on subsequent events for sale of land use
right after March 31, 2015 and potential impact to the banking facilities.&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
Prime Rate, HIBOR and Peoples' Bank of China loan benchmark interest rate were 5.00%, 0.53% and 5.75% per annum, respectively,
as of March 31, 2015. The Prime Rate is determined by the Hong Kong Bankers Association and is subject to revision from time to
time. Interest rates are subject to change if the Company defaults on the amount due under the facility or draws in excess of
the facility amounts, or at the discretion of the banks.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.05pt; text-align: justify; text-indent: 35.9pt"><FONT STYLE="font-size: 10pt">The
weighted average interest rates of borrowings of the Company are as follows:</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 60%; font: 10pt Times New Roman, Times, Serif; margin-left: 0.5in">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">During the fiscal year ended March 31,</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 20%; text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Bank overdrafts</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 12%; text-align: right"><FONT STYLE="font-size: 10pt">6.00</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="width: 4%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 12%; text-align: right"><FONT STYLE="font-size: 10pt">6.00</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Notes payable</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2.96</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2.92</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Term Loan in Hong Kong</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2.47</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2.47</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Term Loan in PRC</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">6.77</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Factoring</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1.96</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1.74</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
</TABLE>




<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-17-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"></P>

<!-- Field: Page; Sequence: 19 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc.</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>8</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Income
                                         tax</B></FONT></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(a)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The subsidiaries
                                         comprising the Group are subject to tax on an entity basis on income arising in or derived
                                         from Hong Kong and the PRC. The Company is not subject to income taxes in the British
                                         Virgin Islands.</FONT></TD></TR>                                                                                                                          <TR STYLE="vertical-align: top">
<TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>



<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-indent: 0.5in"><FONT STYLE="font-size: 10pt">Hong Kong
Tax</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
subsidiaries operating in Hong Kong are subject to the Hong Kong profits tax rate of 16.5% (2014: 16.5%). BIL has no assessable
profits for the year ended March 31, 2015. Both BEL and BATL have assessable profits for the year ended March 31, 2015 and will
be offset against prior year tax losses. Therefore, no current year provision for taxation has been made for the year ended March
31, 2015 (2014: $nil).<BR></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">Since
December 2005, BEL was under tax review by the local tax authorities for the profits tax assessment for the fiscal years ended
March 31, 2000 to 2005. During the tax years under review, BEL was reporting profits tax with tax benefit of 50% reduction in
tax payment due to import processing. However, the local tax authorities later believed that BEL was not entitled to this tax
benefit as the PRC factory setup was no longer considered an import processing. Also, during the tax years under review, the local
tax authorities believed that some profits of BEII were generated within the territory of Hong Kong and should be taxable in Hong
Kong. After review and discussion between the Company and the local tax authorities, both parties agreed that the tax benefit
of 50% reduction was not applicable and certain profits of BEII were taxable in Hong Kong during the tax years in review.<BR></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">During
the fiscal year ended March 31, 2015, the tax review case was closed and confirmed with the local tax authorities and the final
tax and interest payable were approximately $1,545,000. After offsetting with the tax reserve certificates purchased for approximately
$1,710,000, the Company obtained a refund of approximately $165,000.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 29.7pt; text-indent: 6.3pt"><FONT STYLE="font-size: 10pt">PRC
Tax</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">All
subsidiaries registered in the PRC are subject to a tax rate of 25% (2014: 25%).</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-18-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 20 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc. </B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>8</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Income
                                         tax (continued)</B></FONT></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(b)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Income
                                         is subject to taxation in the various countries in which the Company and its subsidiaries
                                         operate. The (loss) / income before income taxes by geographical location is analyzed
                                         as follows:</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 74%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; vertical-align: top; padding-left: 0.5in"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: justify; padding-left: 0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; padding-left: 0.5in; vertical-align: top"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; padding-left: 0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 20%; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Hong Kong</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">(3,509</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">(1,495</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">(55</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">PRC</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2,832</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,337</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">148</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 5.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Others</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">(48</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">(63</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">(20</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: justify; padding-left: 5.4pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Total</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">(725</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">(221</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">73</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Others mainly
                                         include the (loss) / income from BVI.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(c)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Income
                                         tax (expense) / credit comprises the following:</FONT></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 77%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 25%; text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Deferred
    income tax</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">2</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 4%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 4%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Current income tax
    expense</FONT></TD><TD STYLE="padding-left: 0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(31</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(13</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Income
    tax credit</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">1,050</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Total
    income tax (expense) / credit</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">(29</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">1,037</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The components
                                         of the income tax (expense) / credit by geographical location are as follows:</FONT></TD></TR>                                                                                                                                                                                              <TR STYLE="vertical-align: top">
<TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 74%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 20%; text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Hong Kong</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right; vertical-align: top"><FONT STYLE="font-size: 10pt">(29</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="width: 5%; vertical-align: top; padding-left: 0.5in; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">1,050</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">PRC</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(13</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Others</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Total</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">(29</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">1,037</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">At the end
                                         of the accounting period, the income tax liabilities are as follows:</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 55%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 16%; text-align: left"><FONT STYLE="font-size: 10pt; line-height: 150%">Non-current</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">2,595</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 4%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt; line-height: 150%">Current</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><td style="text-align: right; padding-bottom: 1pt; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">7</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">7</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; vertical-align: top; padding-left: 0.5in"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt; line-height: 150%">Total</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; padding-bottom: 2.5pt; border-bottom: Black 3pt double"><FONT STYLE="font-size: 10pt">2,602</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">7</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-19-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-right: 0; border-bottom: Black 1pt solid; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"></P>

<!-- Field: Page; Sequence: 21 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc. </B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>8</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Income
                                         tax (continued)</B></FONT></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(d)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Deferred
                                         tax assets comprise the following:</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.05in; text-indent: -0.05in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 71%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 35%; text-align: left; padding-left: 0.5in; text-indent: -33pt"><FONT STYLE="font-size: 10pt">Tax loss carry
    forwards</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; border-top: Black 1pt solid; border-left: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right; border-top: Black 1pt solid"><FONT STYLE="font-size: 10pt">853</FONT></TD><TD STYLE="width: 1%; text-align: left; border-right: Black 1pt solid; border-top: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; border-top: Black 1pt solid; border-left: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right; border-top: Black 1pt solid"><FONT STYLE="font-size: 10pt">4,459</FONT></TD><TD STYLE="width: 1%; text-align: left; border-top: Black 1pt solid; border-right: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Less: Valuation allowance<BR></FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt; border-left: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">(853</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt; border-right: Black 1pt solid"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt; border-left: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">(4,459</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt; border-right: Black 1pt solid"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; border-left: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; border-right: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; border-left: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; border-right: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 2.5pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left; border-left: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left; border-right: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.5pt; text-align: left; border-left: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 2.5pt double; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt; text-align: left; border-right: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid; border-left: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; border-bottom: Black 1pt solid; border-left: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; border-bottom: Black 1pt solid; border-right: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">As
of March 31, 2014 and 2015, the Company had accumulated tax losses amounting to approximately $3,600,000 and $25,327,000 (the
tax effect thereon is $853,000 and $4,459,000), respectively, subject to the final agreement by the relevant tax authorities,
which may be carried forward and applied to reduce future taxable income which is earned in or derived from Hong Kong and other
countries. Realization of deferred tax assets associated with tax loss carry forwards is dependent upon generating sufficient
taxable income prior to their expiration. A valuation allowance is established against such tax losses when management believes
it is more likely than not that a portion may not be utilized. As of March 31, 2015, the Company&rsquo;s accumulated tax losses
of $2,189,000 will expire in 2018, $164,000 will expire in 2019 and $951,000 will expire in 2020.</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(e)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Changes
                                         in valuation allowance are as follows:</FONT></TD></TR></TABLE>


<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="RIGHT" STYLE="border-collapse: collapse; width: 82%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-left: 0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 30%; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Balance, April 1</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">784</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 4%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">700</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 4%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">853</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">(Credited) / charged
    to income tax expense</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(84</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">153</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">3,606</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">&#9472;&#9472;&#9472;&#9472;&#9472;&#9472;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">&#9472;&#9472;&#9472;&#9472;&#9472;&#9472;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">&#9472;&#9472;&#9472;&#9472;&#9472;&#9472;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Balance, March 31</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">700</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">853</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">4,459</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">&#9552;&#9552;&#9552;&#9552;&#9552;&#9552;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">&#9552;&#9552;&#9552;&#9552;&#9552;&#9552;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">&#9552;&#9552;&#9552;&#9552;&#9552;&#9552;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE><BR STYLE="clear: both">

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-20-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-right: 0; border-bottom: Black 1pt solid; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 22 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc.</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>8</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Income
                                         tax (continued)</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(f)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The actual
                                         income tax (expense) / credit attributable to earnings for the fiscal years ended March
                                         31, 2013, 2014 and 2015 differed from the amounts computed by applying the Hong Kong
                                         statutory tax rate in accordance with the relevant income tax law as a result of the
                                         following:</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 46%; text-align: left; text-indent: -3pt; padding-left: 3pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">(Loss)
    / income before income taxes</FONT></TD><TD STYLE="width: 5%; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">(725</FONT></TD><TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="width: 5%; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">(221</FONT></TD><TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="width: 5%; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">73</FONT></TD><TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">Income tax benefit / (expense)
    on pretax income at statutory rate</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">120</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">36</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(12</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Effect of different tax rates of subsidiary
    <BR>operating in other jurisdictions</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(249</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(28</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(233</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">Profit not subject to income
    tax</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">3,600</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,129</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">542</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">Expenses not deductible for
    income tax purposes</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(3,469</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(1,137</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(336</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">(Decrease) / increase in
    valuation allowance</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(84</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">153</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">3,606</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -8.1pt; padding-left: 8.1pt"><FONT STYLE="font-size: 10pt">Reversal of provision
    from conclusion of tax review with tax authorities</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2,595</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">Tax expense from conclusion
    of tax review with tax authorities</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(1,545</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">Under provision of prior
    year</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">(31</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -3pt; padding-left: 3pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Utilization
    of tax losses not previously recognized / (tax losses<BR> &nbsp;not yet recognized)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">84</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">(153</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">(3,580</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -3pt; padding-left: 3pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -3pt; padding-left: 3pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Total
    income tax (expense) / credit</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">(29</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">1,037</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
statutory rate of 16.5% used above is that of Hong Kong, where the Company&rsquo;s main business is located.</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(g)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The Company
                                         complies with ASC 740 and assessed the tax position during the fiscal year ended March
                                         31, 2015 and concluded that such prior year uncertain income tax liability was no longer
                                         required. Included in the total tax liabilities of $7,000 (2014: $2,602,000), the uncertain
                                         tax liabilities in respect of this for the year ended March 31, 2015 amounted to $nil
                                         (2014: $2,595,000).</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
Company&rsquo;s accounting policy is to treat interest and penalties as components of income taxes. As of March&nbsp;31, 2015,
the Company had no accrued penalties related to uncertain tax positions (2014: $994,000).</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-21-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-right: 0; border-bottom: Black 1pt solid; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 23 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc.</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>9</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Financial
                                         instruments at fair value</B></FONT></TD></TR></TABLE>


<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
Company complies with ASC 820, &ldquo;<I>Fair Value Measurements</I>&rdquo; (&ldquo;ASC 820&rdquo;). ASC 820 clarifies the definition
of fair value, prescribes methods for measuring fair value and establishes a fair value hierarchy to classify the inputs used
in measuring fair value as follows:</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">Level
1-Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">Level
2-Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar
assets and liabilities in markets that are not active, inputs other than quoted prices that are observable and inputs derived
from or corroborated by observable market data.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">Level
3-Inputs are unobservable inputs which reflect the reporting entity's own assumptions on what assumptions the market participants
would use in pricing the asset or liability based on the best available information.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
Company entered into forward contracts with a bank, and the bank will pay the Company if the Chinese Yuan appreciates against
USD. If the Chinese Yuan depreciates against USD, the Company will need to pay the bank, but will be able to buy more Chinese
Yuan as a result.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">During
the fiscal year ended March 31, 2015, based on our valuation of the existing forward contracts, we recorded a gain of approximately
$131,000 (2014: loss of $419,000) for the change in valuation, resulting in a liability of approximately $196,000 (2014: $327,000).&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">During
the fiscal year ended March 31, 2015, the Company purchased an investment product for approximately $390,000 through Ping An Bank
(2014: $nil), and the fair value at March 31, 2015 was valuated at approximately $391,000 (2014: $nil).<BR></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">At
the end of the accounting period, the fair value of the following assets / (liabilities) were as follows:</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="15" STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 10pt">March 31, 2014</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="15" STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 10pt">March 31, 2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Level
                                         1</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Level
                                         2</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Level
                                         3</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Total</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Level
                                         1</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Level
                                         2</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Level
                                         3</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Total</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 15%; text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Forward
    contracts (1)</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">(327</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">(327</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">(196</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">(196</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Investment product
    (2)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">391</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">391</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/107% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(1)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The fair
                                         value of forward contracts was determined based on the present value of expected future
                                         cash flows considering the risks involved, and using discount rates appropriate for the
                                         respective maturities. Observable level 2 inputs are used to determine the present value
                                         of expected future cash flows.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(2)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Observable
                                         inputs for the fair value of financial instruments were not assessable. The fair value
                                         is determined based on valuation and projection provided by Ping An Bank. On July 8,
                                         2015, the investment product has been redeemed for approximately $397,000 for a net gain
                                         of approximately $6,000.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-22-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 24 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc.</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>10</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Investment
                                         in life insurance contract</B><BR>
                                         <BR>
                                         </FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">Investment
in life insurance contract represents the carrying amount (surrender value) of the contract if it is to be terminated by the Company.
There is one life insurance contract as of March 31, 2015 and March 31, 2014, with carrying amount of approximately $136,000 and
$131,000, respectively. All premiums of this contract have already been paid during the fiscal year ended March 31, 2012. The
face amount (death benefit) of this contract is $1,000,000. During the fiscal year ended March 31, 2015, we recorded a gain of
approximately $5,000 for the change in valuation (2014: $4,000).</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-23-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 25 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc. </B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>11</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Leases</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(a)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Capital
                                         leases</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">During the
                                         year ended March 31, 2014, the Company entered into capital lease obligations amounting
                                         to approximately $123,000 for two motor vehicles. During the year ended March 31, 2015,
                                         the Company did not enter into additional capital lease obligations.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Future minimum
                                         payments under capital leases as of March 31, 2015 with an initial term of more than
                                         one year are as follows:</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 96%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt; line-height: 150%">Future
                                         minimum payments under capital leases for the years ended March 31,</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Principal
                                         repayment</FONT><FONT STYLE="font-size: 10pt"><BR><FONT STYLE="line-height: 150%"> $
                                         in thousands</FONT></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Interest
                                         payment </FONT><FONT STYLE="font-size: 10pt"><BR><FONT STYLE="line-height: 150%">$ in
                                         thousands</FONT></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Total
                                         obligations</FONT><FONT STYLE="font-size: 10pt"><BR><FONT STYLE="line-height: 150%">
                                         $ in thousands</FONT></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; text-align: left; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 20%; text-align: left"><FONT STYLE="font-size: 10pt">2016</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 17%; text-align: right"><FONT STYLE="font-size: 10pt">23</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 17%; text-align: right"><FONT STYLE="font-size: 10pt">2</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 17%; text-align: right"><FONT STYLE="font-size: 10pt">25</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2017</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">23</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">24</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2018</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">20</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">21</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">2019<BR></FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">0</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">68</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">4</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">72</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>




<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-24-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"></P>

<!-- Field: Page; Sequence: 26 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc. </B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>11</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Leases
                                         (continued)</B></FONT></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(b)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Operating
                                         leases</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">As of March
                                         31, 2015, the Company leases two properties, a factory in Shenzhen and part of production
                                         facilities in Xinxing under rental agreements to third parties. The Company will need
                                         to pay a cancellation fee of approximately $69,000 if the Company decides to terminate
                                         all the rental agreements before their expiry.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
Shenzhen factory was rented out to a third party from August 1, 2013 to August 1, 2019. The metal stamping facilities in Xinxing
were rented out to a third party from July 1, 2013 to June 30, 2016. The plastic injection facilities in Xinxing were rented out
to a third party from January 1, 2015 to December 31, 2020. The expected future rental payments to be received are as follows:</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 48%; font: 10pt Times New Roman, Times, Serif; background-color: White; margin-left: 0.5in">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Year ending March 31,</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 20%; text-align: left"><FONT STYLE="font-size: 10pt">2016</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 10%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 15%; text-align: right"><FONT STYLE="font-size: 10pt">1,307</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2017</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,341</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2018</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,383</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2019<BR></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1,383</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">2020</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">461</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: right; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; padding-bottom: 2.5pt; border-bottom: Black 3pt double"><FONT STYLE="font-size: 10pt">5,875</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">As
of March 31, 2015, the future minimum lease commitment payables in respect of non-cancellable operating leases for two offices
in Shenzhen and a staff quarter in Xinxing are as follows:&nbsp;</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 48%; font: 10pt Times New Roman, Times, Serif; background-color: White; margin-left: 0.5in">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Year ending March 31,</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 20%; text-align: left"><FONT STYLE="font-size: 10pt">2016</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 10%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 15%; text-align: right"><FONT STYLE="font-size: 10pt">119</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2017</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">122</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2018</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">107</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">2019</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid">20 </TD><TD STYLE="text-align: left"></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 3pt double">368</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>



<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Rental expenses
                                         for all operating leases of two office premises in Shenzhen and a staff quarter in Xinxing
                                         amounted to approximately $nil, $51,000 and $100,000 for the fiscal years ended March
                                         31, 2013, 2014 and 2015, respectively.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-25-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 27 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc. </B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-size: 10pt">12&#9;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commitments
and contingent liabilities</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(a)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Commitments</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Capital
                                         expenditures contracted at the balance sheet date but not yet provided for are as follows:</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 88%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 10pt">March 31,</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right; vertical-align: top"><FONT STYLE="font-size: 10pt">2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 44%; text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Construction
    in Xinxing, Guangdong, PRC</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 12%; text-align: right"><FONT STYLE="font-size: 10pt">665</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 12%; text-align: right"><FONT STYLE="font-size: 10pt">301</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Leasehold
    improvement in Hong Kong</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">73</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">738</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">301</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">As
of March 31, 2015, the Company entered into contractor agreements to construct a factory building and leasehold improvements on
the manufacturing facility in Xinxing, the PRC for total consideration of $1,561,000. As of March 31, 2015, $1,260,000 has been
paid, and the remaining balance of $301,000 is to be paid in accordance with the progress of the construction.</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(b)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Contingent
                                         liabilities</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">The
Company has entered into an employment agreement with a director, Anthony So. Mr. So&rsquo;s employment agreement provides for
a maximum yearly salary of approximately $800,000 per year plus bonus. The initial term of the employment agreement expired on
March 31, 2013 (&ldquo;Initial Term&rdquo;); however, the employment agreement has been renewed under a provision in the agreement
that provides for automatic renewal for successive one year periods, unless at least 90 days prior to the expiration of the Initial
Term or any renewal term, either party gives written notice to the other party specifically electing to terminate the agreement.
Mr. So&rsquo;s employment agreement contains a provision under which the Company will be obligated to pay Mr. So all compensation
for the remainder of his employment agreement and five times his annual salary and bonus compensation if a change of control,
as defined in his employment agreement occurs. The employment agreement was renewed automatically, and will expire on March 31,
2016, unless automatically renewed.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-26-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<!-- Field: Page; Sequence: 28 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center; text-indent: 0.5in"><FONT STYLE="font-size: 10pt"><BR CLEAR="ALL">
<B>Bonso Electronics International Inc. </B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in; color: purple"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>13</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Stockholders&rsquo;
                                         equity</B></FONT></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(a)</FONT></TD><TD><FONT STYLE="font-size: 10pt">Repurchase of common stock</FONT></TD></TR>                                                                                                                                                                             <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify"><FONT STYLE="font-size: 10pt">In
August of 2001, the Company's Board of Directors authorized a program for the Company to repurchase up to $500,000 of its common
stock. This repurchase program does not obligate the Company to acquire any specific number of shares or acquire shares over any
specified period of time. No stock had been repurchased when, on November 16, 2006, the Company's Board of Directors authorized
another $1,000,000 for the Company to repurchase its common stock under the same repurchase program. This authorization to repurchase
shares increased the amount authorized for repurchase from $500,000 to $1,500,000. The Board of Directors believed that the common
stock was undervalued and that the repurchase of common stock would be beneficial to the Company's stockholders. The Company (through
its subsidiary) has repurchased an aggregate of 330,736 shares of its common stock, including 70,019 ($134,000) shares that were
repurchased during the fiscal year ended March 31, 2009. No shares were repurchased during the three fiscal years ended March
31, 2013, 2014 and 2015. The Company may from time to time repurchase shares of its common stock under this program.</FONT>&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(b)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Preferred
                                         stock</FONT></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The Company
                                         has authorized share capital of $100,000 for 10,000,000 shares of preferred stock, with
                                         par value of $0.01 each, divided into 2,500,000 shares each of class A preferred stock,
                                         class B preferred stock, class C preferred stock and class D preferred stock. Shares
                                         may be issued within each class from time to time by the Company&rsquo;s Board of Directors
                                         in its sole discretion without the approval of the stockholders, with such designations,
                                         power, preferences, rights, qualifications, limitation and restrictions as the Board
                                         of Directors shall fix and as have not been fixed in the Company&rsquo;s Memorandum of
                                         Association. The Company has not issued any shares of preferred stock as of March 31,
                                         2015.</FONT></TD></TR></TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(c)</FONT></TD><TD><FONT STYLE="font-size: 10pt">Dividends</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">No
dividends were declared by the Company for each of the fiscal years ended March 31, 2013, 2014 and 2015, respectively.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-27-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 29 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc.</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>14</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Stock
                                         option and bonus plans </B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(a)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">1996
                                         Stock Option Plan<BR>
                                         <BR>
                                         In October 1996, the Company&rsquo;s Board of Directors approved the 1996 Stock Option
                                         Plan and 1996 Non-Employee Directors&rsquo; Stock Option Plan. Under the 1996 Stock Option
                                         Plan, the Company may grant options of common stock to certain employees and directors
                                         of the Company for a maximum of 900,000 shares. The 1996 Stock Option Plan is administered
                                         by a committee appointed by the Board of Directors which determines the terms of options
                                         granted, including the exercise price, the option periods and the number of shares to
                                         be subject to each option. The exercise price of options granted under the 1996 Stock
                                         Option Plan may be less than the fair market value of the common shares on the date of
                                         grant. The maximum term of options granted under the 1996 Stock Option Plan is 10 years.
                                         The right to acquire the common shares is not assignable except for certain conditions
                                         stipulated in the 1996 Stock Option Plan.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Under the
                                         1996 Non-Employee Directors&rsquo; Stock Option Plan, the non-employee directors were
                                         automatically granted stock options on the third business day following the day of each
                                         annual general meeting of the Company to purchase shares of common stock. The maximum
                                         number of authorized shares under the 1996 Non-Employee Director&rsquo;s Stock Option
                                         Plan was 600,000. The exercise price of all options granted under the 1996 Non-Employee
                                         Directors&rsquo; Stock Option Plan shall be one hundred percent of the fair market value
                                         per share of the common shares on the date of grant. The maximum term of options granted
                                         under the 1996 Non-Employee Directors&rsquo; Stock Option Plan is 10 years. No stock
                                         option may be exercised during the first six months of its term except for certain conditions
                                         provided in the 1996 Non-Employee Directors&rsquo; Stock Option Plan. The right to acquire
                                         the common shares is not assignable except for under certain conditions stipulated in
                                         the 1996 Non-Employee Directors&rsquo; Stock Option Plan.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">In April
                                         2003, the Company issued options to certain directors and non-employee directors of the
                                         Company to purchase an aggregate of 372,500 shares of common stock of the Company at
                                         an exercise price of $1.61. The exercise prices of these options were equal to the fair
                                         market value at the time of grant. The options expired on March 31, 2013. No such options
                                         have been exercised during the year ended March 31, 2013.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">In March
                                         2004, the Company issued options to certain non-employee directors of the Company to
                                         purchase an aggregate of 40,000 shares of common stock of the Company at an exercise
                                         price of $6.12. The exercise prices of these options were equal to the fair market value
                                         at the time of grant. The options expired on March 25, 2014. No such options have been
                                         exercised up to March 31, 2014.<BR>
                                         <BR>
                                         In September 2004, the Company issued options to certain non-employee directors of the
                                         Company to purchase an aggregate of 40,000 shares of common stock of the Company at an
                                         exercise price of $6.20. The exercise prices of these options were equal to the fair
                                         market value at the time of grant. The options expired on September 12, 2014. No such
                                         options have been exercised up to September 12, 2014.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">In December
                                         2005, the Company issued options to certain non-employee directors of the Company to
                                         purchase an aggregate of 30,000 shares of common stock of the Company at an exercise
                                         price of $4.50. The options shall expire on December 4, 2015 and can be exercised at
                                         any time after granting. The exercise prices of these options were equal to the fair
                                         market value at the time of grant. No such options had been exercised during the years
                                         ended March 31, 2013, 2014 and 2015.<BR>
                                         <BR>
                                         On November 16, 2006, the Board of Directors of the Company voted to rescind the Company&rsquo;s
                                         1996 Non-Employee Directors&rsquo; Stock Option Plan (the &ldquo;Non-Employee Directors&rsquo;
                                         Plan&rdquo;). All options previously granted under the Non-Employee Directors&rsquo;
                                         Plan continue in full force and effect pursuant to their terms of grant.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">During the
                                         fiscal years ended March 31, 2013, 2014 and 2015, no shares or share options were granted
                                         under the 1996 Stock Option Plan.</FONT></TD></TR></TABLE>




<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-28-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"></P>

<!-- Field: Page; Sequence: 30 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc. </B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>14</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Stock
                                         option and bonus plans (continued)</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(b)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">2004
                                         Stock Bonus Plan<BR>
                                         <BR>
                                         On September 7, 2004, the Company&rsquo;s stockholders adopted the 2004 Stock Bonus Plan
                                         (the &ldquo;Stock Bonus Plan&rdquo;) which authorizes the issuance of up to five hundred
                                         thousand (500,000) shares of the Company&rsquo;s common stock in the form of stock bonus.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
purpose of this Stock Bonus Plan is to (i) induce key employees to remain in the employment of the Company or of any subsidiary
of the Company; (ii) encourage such employees to secure or increase their stock ownership in the Company; and (iii) reward employees,
non-employee directors, advisors and consultants for services rendered or to be rendered to or for the benefit of the Company
or any of its subsidiaries. The Company believes that the Stock Bonus Plan will promote continuity of management and increase
incentive and personal interest in the welfare of the Company.</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
Stock Bonus Plan shall be administered by a committee appointed by the Board of Directors which consists of at least two but not
more than three members of the Board, one of whom shall be a non-employee of the Company. The existing Committee members are Mr.
Anthony So and Mr. Woo Ping Fok. The Committee has the authority, in its sole discretion: (i) to determine the parties to receive
bonus stock, the times when they shall receive such awards, the number of shares to be issued and the time, terms and conditions
of the issuance of any such shares; (ii) to construe and interpret the terms of the Stock Bonus Plan; (iii) to establish, amend
and rescind rules and regulations for the administration of the Stock Bonus Plan; and (iv) to make all other determinations necessary
or advisable for administering the Stock Bonus Plan.</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(c)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">2004
                                         Stock Option Plan<BR>
                                         <BR>
                                         On March 23, 2004, the Company&rsquo;s stockholders adopted the 2004 Stock Option Plan
                                         (the &ldquo;2004 Plan&rdquo;) which provides for the grant of up to six hundred thousand
                                         (600,000) shares of the Company&rsquo;s common stock in the form of stock options, subject
                                         to certain adjustments as described in the Plan. At the Annual meeting of stockholders
                                         held on March 20, 2015, the stockholders approved an amendment to the 2004 Plan to increase
                                         the number of shares that could be granted from 600,000 to 850,000.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/50% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
purpose of the 2004 Plan is to secure key employees to remain in the employment of the Company and to encourage such employees
to secure or increase on reasonable terms their common stock ownership in the Company. The Company believes that the 2004 Plan
promotes continuity of management and increased incentive and personal interest in the welfare of the Company.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
2004 Plan is administered by a committee appointed by the Board of Directors which consists of at least two but not more than
three members of the Board, one of whom shall be a non-employee of the Company. The current committee members are Mr. Anthony
So and Mr. Woo Ping Fok. The committee determines the specific terms of the options granted, including the employees to be granted
options under the plan, the number of shares subject to each option grant, the exercise price of each option and the option period,
subject to the requirement that no option may be exercisable more than 10 years after the date of grant. The exercise price of
an option may be less than the fair market value of the underlying shares of Common Stock. No options granted under the plan will
be transferable by the optionee other than by will or the laws of descent and distribution, and each option will be exercisable
during the lifetime of the optionee only by the optionee.</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
exercise price of an option granted pursuant to the 2004 Plan may be paid in cash, by the surrender of options, in common stock,
in other property, including a promissory note from the optionee, or by a combination of the above, at the discretion of the Committee.<BR>
<BR>
As of March 31, 2015, no options had been granted under the 2004 Plan. Refer to note 20 on subsequent events for options issuance
after March 31, 2015.</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-29-</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 31 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc. </B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>



<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>14</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Stock
                                         option and bonus plans (continued)</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 41.2pt"><FONT STYLE="font-size: 10pt">(d)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The
                                         stock options summary as of March 31, 2015 is as follows:</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 62%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Number
                                         of options</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 10pt">Weighted
                                         average exercise</FONT></P>
                                                                          <P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 10pt; line-height: 150%">price</FONT></P></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 20%; text-align: left"><FONT STYLE="font-size: 10pt; line-height: 150%">Balance,
                                         March 31, 2013</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">110,000</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">5.71</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt; line-height: 150%">Expired</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">(40,000</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="text-align: right; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">6.12</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt; line-height: 150%">Balance,
                                         March 31, 2014</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">70,000</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">5.47</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt; line-height: 150%">Expired</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">(40,000</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="text-align: right; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">6.20</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt; line-height: 150%">Balance,
                                         March 31, 2015</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">30,000</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="text-align: right; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">4.50</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 11pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 11pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-30-</FONT></P>

<P STYLE="font: 11pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 11pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 32 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: center; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"><B>Bonso
Electronics International Inc.</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>14</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Stock
                                         option and bonus plans (continued)</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(e)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The following
                                         table summarizes information about all stock options of the Company outstanding as at
                                         March 31, 2015 :</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 81%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid; font-weight: normal; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; font-weight: normal; text-align: right"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt; line-height: 150%">Weighted
                                         average exercise price</FONT></TD><TD STYLE="padding-bottom: 1pt; font-weight: normal; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: normal; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-weight: normal; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; font-weight: normal; text-align: right"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt; line-height: 150%">Number
                                         outstanding at March 31, 2015</FONT></TD><TD STYLE="padding-bottom: 1pt; font-weight: normal; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 10pt">Weighted
                                         average</FONT></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 10pt">remaining
                                         life</FONT></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 10pt; line-height: 150%">(years)</FONT></P></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="border-bottom: Black 1pt solid; text-align: right"><P STYLE="margin-top: 0; margin-bottom: 0">Exercisable
<BR></P>
                                                                                                                                                                                                                          <P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-size: 10pt">shares at <BR>March 31, 2015</FONT></P></TD><TD STYLE="padding-bottom: 1pt; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="width: 15%; text-align: right; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">4.50</FONT></TD><TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 5%; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 15%; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">30,000</FONT></TD><TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 4%; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 15%; text-align: right; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">0.8</FONT></TD><TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 4%; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 15%; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">30,000</FONT></TD><TD STYLE="width: 1%; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
intrinsic value of options outstanding and exercisable was $nil, $nil and $nil on March 31, 2013, 2014 and 2015, respectively.
The intrinsic value represents the pre-tax intrinsic value (the difference between the closing stock price of the Company&rsquo;s
common stock on the balance sheet date and the exercise price for both the outstanding and exercisable options) that would have
been received by the option holders if all options had been exercised on March 31, 2013, 2014 and 2015.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 40.5pt; text-align: justify; text-indent: -4.5pt"><FONT STYLE="font-size: 10pt">New
shares will be issued by the Company upon future exercise of stock options.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; letter-spacing: -0.1pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-31-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; letter-spacing: -0.1pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: center; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>


<!-- Field: Page; Sequence: 33 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: center; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"><B>Bonso
Electronics International Inc.</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>15</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Related
                                         party transactions</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 2.25pt"></TD><TD STYLE="width: 33.75pt"><FONT STYLE="font-size: 10pt">(a)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The
                                         Company paid emoluments, commissions and/or consultancy fees to its directors and officers
                                         as follows:</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Year
                                         ended</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Mr. Anthony</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Mr. Kim Wah</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Mr. Woo-Ping</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Mr.
                                         Andrew</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">March
                                         31,</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font-weight: normal"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font-weight: normal; text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">So</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chung</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fok</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;So</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Director, Chief Executive <BR>Officer</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Director</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Director</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">Director and Chief Operating Officer</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 16%; text-align: left"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 18%; text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$857 (i), (iii)</FONT></TD><TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 18%; text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$160 (iii)</FONT></TD><TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 17%; text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Nil</FONT></TD><TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="width: 15%; text-align: right"><FONT STYLE="font-size: 10pt">124</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$857 (i), (iii)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$161 (iii)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Nil</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">128</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$857 (i), (iii)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$160 (iii)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Nil</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">$</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">124</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Mr. Henry</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Mr. Albert</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;<BR>Schlueter</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">So</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Director and <BR>Assistant Secretary</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Director, Chief Financial <BR>Officer and
    Secretary</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$74 (ii)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$124 (iii)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 26%; text-align: left"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 28%; text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$84 (ii)</FONT></TD><TD STYLE="width: 8%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 28%; text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$125</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$55 (ii)</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">$109</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The emoluments
                                         paid to the Company&rsquo;s directors and officers were included in the salaries and
                                         related costs, while the consultancy fees or professional fees paid to Schlueter &amp;
                                         Associates, P.C., were included in the administration and general expenses.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 11pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(i)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">Apart
                                         from the emoluments paid by the Company as shown above, one of the properties of the
                                         Company in Hong Kong is also provided to Mr. Anthony So for his accommodation.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 11pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(ii)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The
                                         amounts for the years ended March 31, 2013, 2014 and 2015 represented professional fees
                                         paid to Schlueter &amp; Associates, P.C., the Company&rsquo;s SEC counsel, in which Mr.
                                         Henry Schlueter is one of the principals.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 11pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(iii)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The
                                         amount for the year ended March 31, 2013, included unpaid vacation payments of $57,000,
                                         $9,000, and $5,000 for Mr. Anthony So, Mr. Kim Wah Chung, and Mr. Albert So, respectively.
                                         The amount for the year ended March 31, 2014, included unpaid vacation payments of $10,000,
                                         for Mr. Kim Wah Chung. The amount for the year ended March 31, 2014 included vacation
                                         payment of $57,000 for Mr. Anthony So. The amount for the year ended March 31, 2015,
                                         included unpaid vacation payments of $57,000, $9,000 for Mr. Anthony So and Mr. Kim Wah
                                         Chung, respectively. </FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-32-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 34 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: center; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"><B>Bonso
Electronics International Inc.</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>15</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Related
                                         party transactions (continued)</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">During
the fiscal year ended March 31, 2014, the Company made a loan to a director, Mr. Anthony So, resulting in an amount due to the
Company from Mr. So of $166,000 on March 31, 2014. On August 7, 2014, Mr. So paid $166,000 to the Company to fully repay the amounts
loaned to him.<BR>
<BR>
During the fiscal year ended March 31, 2015, one of the subsidiaries in Hong Kong borrowed an interest-free loan of approximately
$538,000 from a director and stockholder, Mr. Anthony So to provide working capital. This loan was to be repaid by installments
in 48 months. As of March 31, 2015, the Company had repaid approximately $67,000 to Mr. Anthony So, and the balance of loan due
to Mr. Anthony so was approximately $471,000.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">During
the fiscal year ended March 31, 2015, one of the subsidiaries in Shenzhen, PRC entered into a rental agreement with a director
and stockholder, Mr. Anthony So, for three apartment units located in Shenzhen, PRC for office usage. Mr. Anthony So is the sole
owner of these three apartment units. The monthly rental payment was approximately $2,000, and the total rental payment paid to
Mr. Anthony So during the fiscal year ended March 31, 2015 was approximately $10,000.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">During
the fiscal year ended March 31, 2015, one of the subsidiaries in Xinxing, PRC entered into a rental agreement with a director
and stockholder, Mr. Andrew So, for an apartment unit located in Xinxing, PRC for staff quarters. Mr. Andrew So is the sole owner
of this apartment unit. The monthly rental payment was approximately $480, and the total rental payment paid to Mr. Andrew So
during the fiscal year ended March 31, 2015 was approximately $2,000.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-33-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 35 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/107% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: center; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"><B>Bonso
Electronics International Inc. </B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>16</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Concentrations
                                         and credit risk</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
Company operates principally in the PRC (including Hong Kong) and grants credit to its customers in this geographic region. Although
the PRC is economically stable, it is always possible that unanticipated events in foreign countries could disrupt the Company&rsquo;s
operations.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; letter-spacing: -0.1pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">Financial
instruments that potentially subject the Company to a concentration of credit risk consist of cash and trade receivables. The
Company does not require collateral to support financial instruments that are subject to credit risk. &nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; letter-spacing: -0.1pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">At
March 31, 2014 and 2015, the Company had credit risk exposure of uninsured cash and deposits and less than one year in banks of
approximately $1,165,000 and $3,027,000, respectively.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.95pt; letter-spacing: -0.1pt; text-align: justify; text-indent: 0.05pt"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">A
substantial portion, 52%, 45% and 37% of revenue, was generated from one customer for the years ended March 31, 2013, 2014 and
2015, respectively.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify; text-indent: 0.5in"><FONT STYLE="font-size: 10pt">The
net sales to customers representing at least 10% of net total sales are as follows:</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 85%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="23" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Year Ended March
    31,</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size
: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 25%; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Sunbeam Products, Inc.</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">15,818</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">52</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">14,080</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">45</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">6,879</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 6%; text-align: right"><FONT STYLE="font-size: 10pt">24</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Fitbit, Inc.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">5,493</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">18</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">10,396</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">33</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">10,593</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">37</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Kern + Sohn GMBH</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">3,814</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">13</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2,762</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">9</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">5,424</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">19</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 5.4pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">25,125</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">83</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">27,238</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">87</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">22,896</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">80</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.95pt; text-indent: 0.05pt"><FONT STYLE="font-size: 10pt">The
following customers had balances greater than 10% of the total trade receivables at the respective balance sheet dates set forth
below:</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 85%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="15" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">March 31,</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 25%; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Sunbeam Products, Inc.</FONT></TD><TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">1,523</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">61</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">101</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 3%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">8</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Fitbit, Inc.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">355</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">14</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">324</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">25</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Kern + Sohn GMBH</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">169</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">7</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">224</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">17</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Pitney Bowes Inc.</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">219</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">9</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">355</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">27</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 5.4pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">91</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">77</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; letter-spacing: -0.1pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">At
March 31, 2014 and 2015, these customers accounted for 91% and 77%, respectively, of net trade receivables. The trade receivables
have repayment terms of not more than twelve months. Trade receivables for two customers accounted for 33% of total trade receivables
as of March 31, 2015 (2014: 75%), and they were covered by credit insurance under a factoring agreement with a bank.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B>-F-34-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<!-- Field: Page; Sequence: 36 -->
    <DIV STYLE="margin-top: 12pt; margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"></P>

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">Bonso
Electronics International Inc.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>17</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Employee
                                         retirement benefits and severance payment allowance</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 11pt/150% Times New Roman,serif; letter-spacing: -0.1pt; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">(a)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">With
                                         effect from January 1, 1988, BEL, a wholly-owned foreign subsidiary of the Company in
                                         Hong Kong, implemented a defined contribution plan (the &ldquo;Plan&rdquo;) with a major
                                         international insurance company to provide life insurance and retirement benefits for
                                         its employees. All permanent full time employees who joined BEL before December 2000,
                                         excluding factory workers, are eligible to join the Plan. Each eligible employee that
                                         chooses to participate in the Plan is required to contribute 5% of their monthly salary,
                                         while BEL is required to contribute from 5% to 10% depending on the eligible employee&rsquo;s
                                         salary and number of years in service.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; letter-spacing: -0.1pt; text-align: justify; text-indent: -0.5in"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; letter-spacing: -0.1pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">The
Mandatory Provident Fund (the &ldquo;MPF&rdquo;) was introduced by the Hong Kong Government and commenced in December 2000. BEL
joined the MPF by implementing a plan with a major international insurance company. All permanent Hong Kong full time employees
who joined BEL on or after December 2000, excluding factory workers, must join the MPF, except for those who joined the Plan before
December 2000. Both the employee&rsquo;s and employer&rsquo;s contributions to the MPF are 5% of the eligible employee&rsquo;s
monthly salary and are subject to a maximum mandatory contribution of HK$1,000 (US$128) per month. Both the maximum mandatory
employee&rsquo;s and employer&rsquo;s contributions per month increased to HK$1,250 (US$160) since June 1, 2012, and then later
to HK$1,500 (US$192) since June 1, 2014.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; letter-spacing: -0.1pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">Pursuant
to the relevant PRC regulations, the Company is required to make contributions for each employee, at rates based upon the employee&rsquo;s
standard salary base as determined by the local Social Security Bureau, to a defined contribution retirement scheme organized
by the local Social Security Bureau in respect of the retirement benefits for the Company&rsquo;s employees in the PRC.</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; letter-spacing: -0.1pt; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 3pt"></TD><TD STYLE="width: 33pt"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">(b)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The
                                         contributions to each of the above schemes are recognized as employee benefit expenses
                                         when they are due and are charged to the consolidated statement of operations. The Company&rsquo;s
                                         <FONT STYLE="letter-spacing: 0pt">total contributions and accruals to the above schemes
                                         for the years ended March 31, 2013, 2014 and 2015 amounted to $225,000, $758,000 and
                                         $693,000, respectively. </FONT>The Company has no other obligation to make payments in
                                         respect of retirement benefits of the employees.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; letter-spacing: -0.1pt; text-align: justify; text-indent: -33pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; letter-spacing: -0.1pt; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 3pt"></TD><TD STYLE="width: 33pt"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">(c)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt; letter-spacing: 0pt">According
                                         to the New Labor Law in the PRC which was effective on January 1, 2008, a company is
                                         required to provide one month&rsquo;s salary for each year of service as a severance
                                         payment. As such, the Company paid $1,194,000 for severance payment in the fiscal year
                                         ended March 31, 2014 to the terminated staff when production was moved from the Shenzhen
                                         factory to the Xinxing factory. The Company recognized a provision of $256,000 in the
                                         fiscal year ended March 31, 2015 for severance payments for staff in the PRC (2014: $156,000,
                                         2013: $743,000). The accrued severance payment allowance is reviewed every year.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;-F-35-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 37 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">Bonso
Electronics International Inc.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>18</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Net
                                         (loss) / earnings per share</B><BR>
                                         <BR>
                                         </FONT></TD></TR></TABLE>



<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify"><FONT STYLE="font-size: 10pt">Basic
(loss) / earnings per share is computed by dividing net (loss) / earnings available to common stockholders by the weighted average
number of shares of common stock outstanding. Diluted earnings per share is computed in a manner consistent with that of basic
earnings per share while giving effect to all potentially dilutive shares of common stock that were outstanding during the period,
including stock options. The outstanding 30,000 options as of March 31, 2015 have an anti-dilutive effect and are excluded from
calculation of weighted average shares outstanding.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify"><FONT STYLE="font-size: 10pt">The
diluted net (loss) / earnings per share was the same as the basic net (loss) / shares per share for the years ended March 31,
2013, 2014 and 2015, as all potential common shares (110,000 shares on March 31, 2013, 70,000 shares on March 31, 2014 and 30,000
shares on March 31, 2015) from the exercise of stock options are anti-dilutive and are therefore excluded from the computation
of diluted net (loss) / earnings per share.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-36-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 38 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">Bonso
Electronics International Inc.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Notes to
Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>19</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Business
                                         segment information</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(a)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The Company
                                         is organized based on the products it offers. Under this organizational structure, the
                                         Company&rsquo;s operations can be classified into three business segments, Scales, Pet
                                         Electronics Products and Others for the fiscal years ended March 31, 2014 and 2015.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">Scales
operations principally involve production and marketing of sensor-based scales products. These include bathroom, kitchen, office,
jewelry, laboratory, postal and industrial scales that are used in consumer, commercial and industrial applications. Revenue from
scale products were 89% (2014: 95%) of overall revenue of the Company for the fiscal year ended March 31, 2015, and the Company
expects that the revenue from scale products will continue to contribute a similar level of revenue for the next
12 months.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">Pet
Electronics Products principally involve development and production of pet-related electronics products that are used in consumer
applications. Revenue from pet electronics products were 10% (2014: 4%) of overall revenue of the Company for the fiscal year
ended March 31, 2015, and the Company expects that the revenue from pet electronics products will continue to contribute a similar level of revenue for the next 12 months.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
&ldquo;Others&rdquo; segment is a residual, which principally includes the activities of (i) tooling and mould charges for scales
and pet electronics products, and (ii) sales of scrap materials.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in"><FONT STYLE="font-size: 10pt">The following table sets
forth the percentage of net sales for each of the product lines mentioned above for the fiscal years &#9;ended March 31, 2013,
2014, and 2015:</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 84%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="11" STYLE="text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Year ended March
    31,</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Product Line</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 30%; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Scales</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">90</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">95</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="width: 5%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; text-align: right"><FONT STYLE="font-size: 10pt">89</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Pet Electronics Products</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">8</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">4</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">10</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Others</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">1</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Total</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">100</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">100</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">100</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">The
accounting policies of the Company&rsquo;s reportable segments are the same as those described in the description of business
and significant accounting policies.</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-37-</FONT></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 39 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 11pt/150% Times New Roman,serif; margin-top: 0; text-align: center; margin-bottom: 8pt"><FONT STYLE="font-size: 10pt">&#9;<FONT STYLE="line-height: 150%"><B>Bonso
Electronics International Inc.&#9;</B></FONT></FONT></P>

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">Notes
to Consolidated Financial Statements</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>19</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Business
                                         segment information (continued)</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 41.2pt"><FONT STYLE="font-size: 10pt">(a)</FONT></TD><TD><FONT STYLE="font-size: 10pt">(Continued)</FONT></TD></TR></TABLE>



<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"></P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify"><FONT STYLE="font-size: 10pt">Summarized
financial information by business segment as of March 31, 2013, 2014 and 2015 is as follows:</FONT></P>



<P STYLE="margin: 0"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 5.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Net
                                         sales</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Operating
                                         (loss)/income</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Identifiable
                                         assets as of <BR>March 31</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Depreciation
    and amortization</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">Capital
    expenditure</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">$
                                         in thousands</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">$
                                         in thousands</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">$
                                         in thousands</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt"><U>2013</U></FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 29%; font: 10pt Times New Roman,serif; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Scales
    &amp; Others (A)</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">27,998</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">(371</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">18,518</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; width: 11%"><FONT STYLE="font-size: 10pt">111</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; width: 11%"><FONT STYLE="font-size: 10pt">1,301</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Pet
    Electronics Products (A)</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2,388</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">(32</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt">)</TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">1,579</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">9</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">111</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Total
    operating segments</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">30,386</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">(403</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">20,097</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">120</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,412</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Corporate</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">7,026</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">226</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">-</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Group</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">30,386</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">(403</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">)</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">27,123</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">346</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">1,412</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt"><U>2014</U></FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Scales &amp;
    Others(A)</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">29,837</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right">281</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">23,279</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,035</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">2,762</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Pet
    Electronics Products (A)</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">1,468</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid">14</TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">1,145</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">51</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">136</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Total
    operating segments</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">31,305</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">295</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">24,424</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,086</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">2,898</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Corporate</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">7,716</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">289</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">-</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Group</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">31,305</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">295</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">32,140</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">1,375</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">2,898</FONT></TD></TR>
</TABLE>



<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: 10pt Times New Roman,serif; text-decoration: underline; text-align: left; padding-left: 5.4pt"></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-decoration: underline; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">2015</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 25%; font: 10pt Times New Roman,serif; text-align: left; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Scales
    &amp; Others</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">25,911</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">414</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">16,172</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%; font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">968</FONT></TD><TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 11%; font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,472</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Pet
    Electronics Products</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">3,033</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">48</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">1,893</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">114</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">173</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Total
    operating segments</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">28,944</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">462</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">18,065</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,082</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">1,645</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Corporate</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">7,712</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">294</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&mdash;&nbsp;&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: justify; padding-left: 5.4pt; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">Group</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">28,944</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">462</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">25,777</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">1,376</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman,serif; text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="font: 10pt Times New Roman,serif; text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">1,645</FONT></TD></TR>
</TABLE>


<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt">&nbsp;</P>

<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt">Note A: Segment information for the fiscal years
ended March 31, 2013 and 2014 have been restated as the Pet Electronics Product segment met the 10% threshold for the fiscal
year ended March 31, 2015.</P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">Operating
(loss) / income by segment equals total operating revenues less expenses directly attributable to the generation of the segment&rsquo;s
operating revenues. Operating loss of the corporate segment consists principally of salaries and related costs of administrative
staff, and administration and general expenses of the Company. Identifiable assets by segment are those assets that are used in
the operation of that segment. Corporate assets consist principally of cash and cash equivalents, investment in life insurance
contracts, income tax recoverable, other intangible assets, and other identifiable assets not related specifically to individual
segments.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-38-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 40 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc. </B></FONT></P>

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">Notes
to Consolidated Financial Statements</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B></FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>19</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Business
                                         segment information (continued)</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/10% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: -35.45pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 35.45pt"><FONT STYLE="font-size: 10pt">(b)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The
                                         Company primarily operates in Hong Kong and the PRC. The manufacture of components and
                                         their assembly into finished products and research and development are carried out in
                                         the PRC. As the operations are integrated, it is not practicable to distinguish the net
                                         income derived among the activities in Hong Kong, and the PRC.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/10% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: -35.45pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">Total
property, plant and equipment, net by geographical areas are as follows:</FONT></P>

<P STYLE="font: 10pt/10% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 75%; font: 10pt Times New Roman, Times, Serif; background-color: White; margin-left: 0.5in">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">March
                                         31,</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">March
                                         31,</FONT></TD>
    </TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">2015</FONT></TD>
    </TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt; line-height: 150%">$ in
                                         thousands</FONT></TD>
    </TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    </TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 36%; text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Hong Kong</FONT></TD><TD STYLE="width: 7%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">1,090</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 7%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 10%; text-align: right"><FONT STYLE="font-size: 10pt">1,194</FONT></TD>
    </TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">The
    PRC</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">11,362</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">11,290</FONT></TD>
    </TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD>
    </TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 2.5pt">Total property, plant and equipment</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">12,452</TD><TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double">12.484</TD>
    </TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 0.5in; text-align: justify; text-indent: -0.5in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(c)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The following
                                         is a summary of net export sales by geographical areas, which are defined by the final
                                         shipment destination, constituting 10% or more of total sales of the Company for the
                                         years ended March 31, 2013, 2014 and 2015:</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 89%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="23" STYLE="text-align: center; border-bottom: Black 1pt solid; vertical-align: top"><FONT STYLE="font-size: 10pt">Year
    ended March 31,</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="7" STYLE="text-align: center"><FONT STYLE="font-size: 10pt">2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in; width: 30%"><FONT STYLE="font-size: 10pt">United
    States</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; width: 1%; vertical-align: top"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; width: 6%"><FONT STYLE="font-size: 10pt">23,804</FONT></TD><TD STYLE="text-align: left; width: 1%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; width: 1%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">78</FONT></TD><TD STYLE="text-align: left; width: 6%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 1%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; width: 6%"><FONT STYLE="font-size: 10pt">25,203</FONT></TD><TD STYLE="text-align: left; width: 1%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; width: 1%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; width: 6%"><FONT STYLE="font-size: 10pt">81</FONT></TD><TD STYLE="text-align: left; width: 1%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; width: 1%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; width: 6%"><FONT STYLE="font-size: 10pt">21,271</FONT></TD><TD STYLE="text-align: left; width: 1%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; width: 1%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; width: 6%"><FONT STYLE="font-size: 10pt">73</FONT></TD><TD STYLE="text-align: left; width: 1%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Germany</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">5,121</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">17</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">4,688</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">15</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">6,210</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">22</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">28,925</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">95</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">29,891</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">96</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">27,481</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">95</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt">(d)</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt">The following
                                         is a summary of net export sales by customers, constituting 10% or more of total sales
                                         of the Company for the years ended March 31, 2013, 2014 and 2015:</FONT></TD></TR></TABLE>




<P STYLE="font: 10pt/100% Times New Roman,serif; margin: 0 0 8pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif; background-color: White">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD COLSPAN="22" STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 10pt"><U>Year
                                         ended March 31,</U></FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD COLSPAN="5" STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 10pt">2013</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD COLSPAN="5" STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 10pt">2014</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD COLSPAN="6" STYLE="text-align: center; vertical-align: top"><FONT STYLE="font-size: 10pt">2015</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Customers</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Segment</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousand</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">$ in thousands</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">%</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 11%; text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Sunbeam
    Products, Inc.</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 11%; text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Scales
    &amp; Pet Electronics Products</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">15,818</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">52</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">14,080</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 9%; text-align: right"><FONT STYLE="font-size: 10pt">45</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 10pt">6,879</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 2%"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="width: 8%; text-align: right"><FONT STYLE="font-size: 10pt">24</FONT></TD><TD STYLE="width: 1%; text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Fitbit, Inc.</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">Scales</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">5,493</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">18</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">10,396</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">33</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">10,593</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">37</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Kern
    + Sohn GMBH</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">Scales</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">3,814</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">13</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">2,762</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">9</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">5,424</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">19</FONT></TD><TD STYLE="text-align: left; padding-bottom: 1pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">25,125</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">83</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">27,238</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">87</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">22,896</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right; border-bottom: Black 2.5pt double"><FONT STYLE="font-size: 10pt">80</FONT></TD><TD STYLE="text-align: left; padding-bottom: 2.5pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-indent: -0.05in; padding-left: 0.05in"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-39-</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>


<!-- Field: Page; Sequence: 41 -->
    <DIV STYLE="margin-bottom: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>Bonso Electronics
International Inc. </B></FONT></P>

<P STYLE="font: bold 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt">Notes
to Consolidated Financial Statements</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Expressed
in United States Dollars)</B><BR>
<BR>
</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-size: 10pt"><B>20</B></FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-size: 10pt"><B>Subsequent
                                         events</B></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt; text-align: justify"></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">On
July 9, 2015, the Company issued options to certain directors and non-employee directors of the Company to purchase an aggregate
of 850,000 shares of common stock of the Company at an exercise price of $1.50. The options for 425,000 shares will expire on
March 31, 2020, and options for 425,000 shares will expire on March 31, 2025. The exercise prices of these options were equal
to the fair market value at the time of grant. No such options have been exercised through the date of this report.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">On
July 10, 2015, the Company entered into an agreement with a third party to sell part of the Company&rsquo;s land use right in
Xinxing, PRC for approximately $866,000. The area of this piece of land is approximately 18% of the total land area of our Xinxing
manufacturing facility. The selling price is approximately 86% more than our initial purchase price, and the resulting gain will
be determined upon final measurement by the local Land Department and the taxation charges by the local tax authorities. This
piece of land includes part of the land use rights currently arranged as securities to a bank for the banking facilities arrangement.
The Company is working with the bank in order to release part of the land use right to the buyer.</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin: 0 0 8pt 35.45pt; text-align: justify; text-indent: 0.55pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/150% Times New Roman,serif; margin-top: 0; margin-bottom: 8pt; text-align: center"><FONT STYLE="font-size: 10pt">-F-40-</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; letter-spacing: -0.1pt; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0pt"></TD><TD STYLE="width: 35.45pt"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt/150% Times New Roman,serif; letter-spacing: -0.1pt; margin-top: 0; margin-bottom: 8pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0pt"></TD><TD STYLE="width: 35.45pt"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>

<P STYLE="font: 10pt/107% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt/107% Times New Roman,serif; margin: 0 0 8pt"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>





<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin-top: 5pt; margin-bottom: 5pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 13.5pt"></TD><TD STYLE="width: 202.5pt"></TD><TD STYLE="text-align: justify"></TD></TR></TABLE>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0 5pt 3in; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I><U></U></I><U></U></FONT></P>



<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/107% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>



<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 12pt/115% Arial Unicode MS,sans-serif; margin: 5pt 0; text-align: justify; text-indent: -202.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>



<P STYLE="margin: 0"></P>

</BODY>
</HTML>
[{"type": "20-F", "sequence": "1", "filename": "bonso3312015.htm", "secsgml_size_bytes": 1469401}]
{"company-data": {"conformed-name": "BONSO ELECTRONICS INTERNATIONAL INC", "cik": "0000846546", "assigned-sic": "3679", "irs-number": "000000000", "state-of-incorporation": "K3", "fiscal-year-end": "0331"}, "filing-values": {"form-type": "20-F", "act": "34", "file-number": "000-17601", "film-number": "151054325"}, "business-address": {"street1": "UNIT 1915-1916, 19/F, DELTA HOUSE", "street2": "3 ON YIU STREET, SHEK MUN", "city": "SHATIN", "state": "K3", "zip": "000000", "phone": "01185226055822"}, "mail-address": {"street1": "UNIT 1915-1916, 19/F, DELTA HOUSE", "street2": "3 ON YIU STREET, SHEK MUN", "city": "SHATIN", "state": "K3", "zip": "000000"}}
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
20-F
[
]	REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES 	EXCHANGE ACT OF 1934
OR
[
X
]	ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE 	ACT OF 1934
For
the Fiscal Year Ended March 31, 2015
OR
[
]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 	EXCHANGE ACT OF 1934
OR
[
]	SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission
File Number: 0-17601
BONSO
ELECTRONICS INTERNATIONAL INC.
(Exact
name of Registrant as specified in its charter)
British
Virgin Islands
(Jurisdiction
of incorporation or organization)
Unit
1404, 14/F, Cheuk Nang Centre,
9
Hillwood Road, Tsimshatsui
Kowloon,
Hong Kong
(Address
of principal executive offices)
Albert
So, Chief Financial Officer
Tel:
(852) 2605-5822 Fax: (852) 2691-1724
Email:
albert@bonso.com
Unit
1404, 14/F, Cheuk Nang Centre,
9
Hillwood Road, Tsimshatsui
Kowloon,
Hong Kong
(Name,
Telephone, email and/or fax number and address of Company Contact Person)
Securities
registered or to be registered pursuant to Section 12(b) of the Act:
None.
Securities
registered pursuant to Section 12(g) of the Act:
COMMON
STOCK, PAR VALUE $.003
Securities
for which there is a reporting obligation pursuant to Section 15(d) of the Act:
None.
Indicate
the number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period
covered by the annual report.
5,577,639
shares of common stock, $0.003 par value, at March 31, 2015 (including 330,736 shares that are held in treasury)
Indicate
by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act of 1933.
Yes
[ ]	No [X]
If
the report is an annual or transition report, indicate by check mark if the Registrant is not required to file reports pursuant
to Section 13 or 15D of the Securities Exchange Act of 1934.
Yes
[ ]	No [X]
Indicate
by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes
[X]	No [ ]
Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter)
during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes [ ]    No [X]
2
Indicate
by check mark whether the Registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.
Large Accelerated Filer [ ]
Accelerated Filer [ ]
Non-accelerated filer [X]
Indicate
by check mark which basis of accounting the Registrant has used to prepare the financial statements included in this filing:
U.S. GAAP [X]
International Financial Reporting Standards
    as issue by the International Accounting Standards Board [ ]
Other [ ]
If
"Other" has been checked in response to the previous question, indicate by check mark which financial statement item
the Registrant has elected to follow:
Item
17 [ ]	Item 18 [ ]
If
this is an annual report, indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act.)
Yes
[ ]	No [X]
3
TABLE
OF CONTENTS
PART I
Page
Item 1.
Identity
    of Directors, Senior Management and Advisors
6
Item 2.
Offer Statistics
    and Expected Timetable
6
Item 3.
Key Information
6
Item 4.
Information on
    the Company
28
Item 4A.
Unresolved Staff
    Comments
41
Item 5.
Operating and
    Financial Review and Prospects
41
Item 6.
Directors, Senior
    Management and Employees
60
Item 7.
Major Shareholders
    and Related Party Transactions
71
Item 8.
Financial Information
73
Item 9.
The Offer and
    Listing
73
Item 10.
Additional Information
75
Item 11.
Quantitative and
    Qualitative Disclosures about Market Risk
79
Item 12.
Description of
    Securities Other Than Equity Securities
80
PART II
Item 13.
Defaults, Dividend
    Arrearages and Delinquencies
80
Item 14.
Material Modifications
    to the Rights of Security Holders and Use of Proceeds
80
Item 15.
Controls and Procedures
80
Item 16.
Reserved
83
Item 16A.
Audit Committee
    Financial Expert
83
Item 16B.
Code of Ethics
84
Item 16C.
Principal Accountant
    Fees and Services
84
Item 16D.
Exemptions from
    the Listing Standards for Audit Committees
86
Item 16E.
Purchases of Equity
    Securities by the Issuer and Affiliates Purchasers
86
Item 16F.
Changes in Registrant's
    Certifying Accountants
86
Item 16G.
Corporate Governance
87
Item 16H.
Mine Safety Disclosure
87
PART III
Item 17.
Financial Statements
87
Item 18.
Financial Statements
F-1
                                         to F-40
Item 19.
Exhibits
88
SIGNATURES
4
FORWARD-LOOKING
STATEMENTS
This
Annual Report on Form 20-F contains forward-looking statements. A forward-looking statement is a projection about a future event
or result, and whether the statement comes true is subject to many risks and uncertainties. These statements often can be identified
by the use of terms such as "may," "will," "expect," "believe," "anticipate,"
"estimate," "approximate" or "continue," or the negative thereof. The actual results or activities
of the Company will likely differ from projected results or activities of the Company as described in this Annual Report, and
such differences could be material.
Forward-looking
statements involve known and unknown risks, uncertainties and other factors that may cause the actual results and performance
of the Company to be different from any future results, performance and achievements expressed or implied by these statements.
In other words, our performance might be quite different from what the forward-looking statements imply. You should review carefully
all information included in this Annual Report.
You
should rely only on the forward-looking statements that reflect management's view as of the date of this Annual Report. We undertake
no obligation to publicly revise or update these forward-looking statements to reflect subsequent events or circumstances. You
should also carefully review the risk factors described in other documents we file from time to time with the Securities and Exchange
Commission (the "SEC"). The Private Securities Reform Act of 1995 contains a safe harbor for forward-looking statements
on which the Company relies in making such disclosures. In connection with the "safe harbor," we are hereby identifying
important factors that could cause actual results to differ materially from those contained in any forward-looking statements
made by us or on our behalf. Factors that might cause such a difference include, but are not limited to, those discussed in the
section entitled "Risk Factors" under Item 3. - Key Information.
FINANCIAL
STATEMENTS AND CURRENCY PRESENTATION
We
prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States
of America and publish our financial statements in United States Dollars.
REFERENCES
In
this Annual Report, "China" refers to all parts of the People's Republic of China other than the Special Administrative
Region of Hong Kong. The terms "Bonso," "we," "our," "us," "the Group"
and the "Company" refer to Bonso Electronics International Inc. and, where the context so requires or suggests, our
direct and indirect subsidiaries. References to "dollars," "U.S. Dollars" or "US$" are to
United States Dollars, "HK$" are to Hong Kong Dollars, "Euros" or "euro" are to the European
Monetary Union's Currency and "RMB" are to Chinese Renminbi.
5
PART
I
Item
1. Identity of Directors, Senior Management and Advisors
Not
Applicable to Bonso.
Item
2. Offer Statistics and Expected Timetable
Not
Applicable to Bonso.
Item
3. Key Information
A.
Selected
                                         Financial Data.
The
selected consolidated financial data as of March 31, 2014 and 2015 and for each of the three fiscal years ended March 31, 2013,
2014 and 2015 are derived from the Audited Consolidated Financial Statements and notes which appear elsewhere in this Annual Report.
The
Financial Statements are prepared in accordance with generally accepted accounting principles in the United States of America
and expressed in United States Dollars. The selected consolidated financial data set forth below as of March 31, 2011, 2012 and
2013, and for each of the two fiscal years in the period ended March 31, 2011 and 2012, have been derived from our audited consolidated
financial statements that are not included in this Annual Report.  The selected consolidated financial data is qualified
in their entirety by reference to, and should be read in conjunction with, the Consolidated Financial Statements and related notes
included in the F pages of this Annual Report and Item 5. – "Operating and Financial Review and Prospects" included
in this Annual Report.
[REMAINDER
OF THIS PAGE LEFT BLANK INTENTIONALLY]
6
SELECTED CONSOLIDATED FINANCIAL DATA
Statement
of Operations Data
(in
000's US$ except for shares and per share data)
Year Ended March 31,
2011
(1)
2012
(1)
(1)
2013
(1)
2014
(
1)
2015
$
$
$
$
$
Net sales
28,387
26,682
30,386
31,305
28,944
Cost of sales
(24,760
)
(22,782
)
(25,263
)
(28,631
)
(23,092
)
Gross profit
3,627
3,900
5,123
2,674
5,852
Rental income
35
34
45
708
1,453
Selling expenses
(249
)
(267
)
(268
)
(389
)
(822
)
Salaries and related costs
(2,716
)
(2,526
)
(2,627
)
(2,983
)
(3,166
)
Research and development expenses
(334
)
(312
)
(396
)
(366
)
(228
)
Administration and general expenses
(1,959
)
(2,492
)
(2,402
)
(2,964
)
(3,245
)
Gain from liquidation of subsidiary
—
1,448
—
—
—
Other income
149
84
120
20
520
Gain on disposal of property, plant and equipment
155
14
2
3,595
98
(Loss) / income from operations
(1,292
)
(117
)
(403
)
295
462
Interest income
6
7
7
64
18
Interest expense
(56
)
(87
)
(68
)
(136
)
(273
)
Foreign exchange loss
(130
)
(703
)
(261
)
(444
)
(134
)
Gain on disposal of intangible assets
41
—
—
—
—
(Loss) / income before income taxes
(1,431
)
(900
)
(725
)
(221
)
73
Income tax (expense) / credit
—
(2
)
(29
)
—
1,037
(Loss) / income from continuing operations
(1,431
)
(902
)
(754
)
(221
)
1,110
Loss from discontinued operations
(2)
(129
)
—
—
—
—
Net (loss) / income
(1,560
)
(902
)
(754
)
(221
)
1,110
Net (loss) / earnings per share - basic and diluted
(3)
-        Continuing operations
-        Discontinued operations
-        Total
($0.27)
($0.02)
($0.29)
($0.17)
($0.00)
($0.17)
($0.14)
($0.00)
($0.14)
($0.04)
($0.00)
($0.04)
$0.21
$0.00
$0.21
Weighted average shares
5,246,903
5,246,903
5,246,903
5,246,903
5,246,903
Diluted weighted average shares
5,246,903
5,246,903
5,246,903
5,246,903
5,246,903
(1)
Certain accounts in the statement of operations for the fiscal years ended March 31, 2011, 2012, 2013 and 2014 have been
reclassified to conform with the presentation for the fiscal year ended March 31, 2015.
(2)
Loss from discontinued operations represents the results of Korona Haushaltswaren GmbH & Co. KG ("Korona"),
a former subsidiary, which was liquidated in February 2012.
(3)
The diluted net (loss) / earnings per share was the same as the basic net (loss) / earnings per share for the fiscal years
ended March 31, 2011, 2012, 2013, 2014 and 2015 as all potential common shares, including the stock options, are anti-dilutive
and therefore excluded from the computation of diluted net (loss) / earnings per share.
7
Balance
Sheet Data
(in
000's US$ except for shares and per share data)
March 31,
2011
2012
2013
2014
2015
$
$
$
$
$
Cash and cash equivalents, and fixed deposits maturing over
    three months
5,407
3,014
2,154
1,165
3,027
Working capital of continuing operations
7,657
2,484
(160
)
(3,769
)
(4,391
)
Total assets of continuing operations
21,807
23,168
27,123
32,140
25,777
Total assets of discontinued operations
(1)
5
—
—
—
—
Total assets
21,812
23,168
27,123
32,140
25,777
Current liabilities of continuing operations
6,285
9,293
13,942
18,646
13,429
Non-current financial liabilities at fair value
—
—
—
208
112
Income tax liabilities, non-current portion
2,595
2,595
2,595
2,595
—
Total liabilities of continuing operations
8,899
11,890
16,537
21,518
13,922
Total liabilities of discontinued operations
(1)
1,086
—
—
—
—
Common stock
17
17
17
17
17
Shareholders' equity
11,827
11,278
10,586
10,622
11,855
Dividends declared per share
—
—
—
—
—
(1)
Total assets and liabilities of discontinued operations represent total assets and liabilities of Korona, a former subsidiary,
which was liquidated in February 2012.
Risk
Factors
You
should carefully consider the following risks, together with all other information included in this Annual Report. The realization
of any of the risks described below could have a material adverse effect on our business, results of operations and future prospects.
8
Political,
Legal, Economic and Other Uncertainties of Operations in China and Hong Kong
We
Could Face Increased Currency Risks If China Does Not Maintain The Stability Of The Hong Kong Dollar or the Chinese Renminbi.
The Hong Kong Dollar and the United States Dollar have been fixed at approximately 7.80 Hong Kong Dollars to 1.00 U.S. Dollar
since 1983. The market exchange rate has not deviated materially from the level of HK$7.80 to US$1.00 since the peg was first
established. However, in May 2005, the Hong Kong Monetary Authority broadened the trading band from the original rate of HK$7.80
per U.S. dollar to a rate range of HK$7.75 to HK$7.85 per U.S. dollar. The Hong Kong government has stated its intention to maintain
the link at that rate. From 1994 until July 2005, the Chinese Renminbi had remained stable against the U.S. Dollar at approximately
8.28 to 1.00 U.S. Dollar. On July 21, 2005, the Chinese currency regime was altered to link the RMB to a "basket of currencies,"
which includes the U.S. Dollar, Euro, Japanese Yen and Korean Won. Under the rules, the RMB was allowed to move 0.3% on a daily
basis against the U.S. Dollar. The People's Bank of China, on May 21 2007, widened the RMB trading band from 0.3% daily movement
against the U.S. Dollar to 0.5%. Following the removal of the U.S. Dollar peg, the RMB appreciated more than 20% against the U.S.
Dollar over the following three years. Since July 2008, however, the RMB has traded within a narrow range against the U.S. Dollar.
As a consequence, the RMB has fluctuated significantly since July 2008 against other freely traded currencies, in tandem with
the U.S. Dollar. On June 20, 2010, the People's Bank of China ("PBOC") announced that the government of
the People's Republic of China ("PRC") would further reform the RMB exchange rate regime and increase the flexibility
of the exchange rate.
Since June 2010,
the PRC government has allowed the RMB to appreciate slowly against the U.S. dollar again, though there have been periods when
the U.S. dollar has appreciated against the Renminbi as well. It is difficult to predict how market forces or PRC or U.S. government
policy may impact the exchange rate between the RMB and the U.S. dollar in the future. As of July 15, 2015, the RMB was valued
at 6.1089 per U.S. Dollar. Any significant revaluation of the RMB may materially and adversely affect our cash flows, revenues,
earnings and financial position and the value of our common shares and any dividends payable to our common shareholders in U.S.
Dollars.
The
Chinese government in the past has expressed its intention in the Basic Law of the PRC to maintain the stability of the Hong Kong
currency after the sovereignty of Hong Kong was transferred to China in July 1997. However, there can be no assurance that the
Hong Kong Dollar will remain pegged against the U.S. Dollar. If the current exchange rate mechanism is changed, we will face increased
currency risks, which could have a material adverse effect upon the Company.
9
We
Face Significant Risks If The Chinese Government Changes Its Policies, Laws, Regulations Or Tax Structure Or Its Current Interpretations
Of Its Laws, Rules And Regulations Relating To Our Operations In China.
Our property in Shenzhen and our manufacturing facility
in Xinxing are located in China. As a result, our operations and assets are subject to significant political, economic, legal
and other uncertainties. Changes in policies by the Chinese government resulting in changes in laws or regulations or the interpretation
of laws or regulations, confiscatory taxation, changes in employment restrictions, restrictions on imports and sources of supply,
import duties, corruption, currency revaluation or the expropriation of private enterprise could materially and adversely affect
us. Over the past several years, the Chinese government has pursued economic reform policies, including the encouragement of private
economic activity and greater economic decentralization. If the Chinese government does not continue to pursue its present policies
that encourage foreign investment and operations in China, or if these policies are either not successful or are significantly
altered, then our business operations in China could be adversely affected. We could even be subject to the risk of nationalization,
which could result in the total loss of investment in that country. Following the Chinese government's policy of privatizing
many state-owned enterprises, the Chinese government has attempted to augment its revenues through increased tax collection. Continued
efforts to increase tax revenues could result in increased taxation expenses being incurred by us. Economic development may be
limited as well by the imposition of austerity measures intended to reduce inflation, the inadequate development of infrastructure
and the potential unavailability of adequate power and water supplies, transportation and communications. If for any reason we
were required to move our manufacturing operations outside of China, our profitability would be substantially impaired, our competitiveness
and market position would be materially jeopardized and we might have to discontinue our operations.
Continuing
Economic Weakness May Adversely Affect Our Earnings, Liquidity And Financial Position.
The Company's business has been
challenging recently as a consequence of adverse worldwide economic conditions. In particular, there has been an erosion of global
consumer confidence from concerns over declining asset values, price instability, geopolitical issues, the availability and cost
of credit, rising unemployment and the stability and solvency of financial institutions, financial markets, businesses and sovereign
nations. These concerns slowed global economic growth and resulted in recessions in many countries, including in the U.S., Europe
and certain countries in Asia. The global economic weakness has negatively impacted our operating results since 2008. Overall,
the economic outlook is uncertain as a result of concerns about the general global economy and the decreased rate of growth in
China and the European Union. Recessionary conditions may return. If negative economic conditions return, a number of material
adverse effects on our business could occur and could have a negative impact upon our results of operations. Further, slower overall
growth of the Chinese economy may have a material adverse effect upon the Company and its results of operations. Also, the Company's
Shenzhen factory is leased out to a third party whose main business is manufacturing of printing and packaging materials to be
sold domestically. Negative economic conditions in China would affect the results of operations of this tenant, which may not
be able to pay future rent to the Company in full or in time according to the lease agreement.
10
The
Economy Of China Has Been Experiencing Significant Growth, Leading To Some Inflation and Increased Labor Costs.
The economy
in China has grown significantly over the past 20 years, which has resulted in inflation and an increase in the average cost of
labor, especially in the coastal cities. China's consumer price index, the broadest measure of inflation, rose 2.42% in
June 2014 from the level in June 2013 and 1.40% between June 2014 and June 2015. Although slowing down recently, China's
overall economy and the average wage in the PRC are expected to continue to grow. Continuing inflation and material increases
in the cost of labor in China could diminish our competitive advantage. If the government tries to control inflation, it may have
an adverse effect on the business climate and growth of private enterprise in the PRC. An economic slowdown may reduce our revenues.
If inflation is allowed to proceed unchecked, our costs would likely increase, and there can be no assurance that we would be
able to increase our prices to an extent that would offset the increase in our expenses.
Changes
To PRC Tax Laws And Heightened Efforts By China's Tax Authorities To Increase Revenues Are Expected To Subject Us To Greater
Taxes.
Since January 1, 2012, our PRC subsidiaries have been subject to a single PRC enterprise income tax rate of 25%.
We base our tax position upon the anticipated nature and conduct of our business and upon our understanding of the tax laws of
the various administrative regions and countries in which we have assets or conduct activities. However, our tax position is subject
to review and possible challenge by taxing authorities and to possible changes in law, which may have retroactive effect. We cannot
determine in advance the extent to which some jurisdictions may require us to pay taxes or make payments in lieu of taxes.
We
Face Risks By Operating In China, Because The Chinese Legal System Relating To Foreign Investment And Foreign Operations Such
As Bonso's Is Evolving And The Application Of Chinese Laws Is Uncertain.
The legal system of China relating to foreign
investments is continually evolving, and there can be no certainty as to the application of its laws and regulations in particular
instances. The Chinese legal system is a civil law system based on written statutes. Unlike common law systems, it is a system
in which decided legal cases have little precedential value. In 1979, the Chinese government began to promulgate a comprehensive
system of laws and regulations governing economic matters in general. Legislation over the past 30 years has significantly enhanced
the protections afforded to various forms of foreign investment in China. Enforcement of existing laws or agreements may be sporadic
and implementation and interpretation of laws inconsistent. The Chinese judiciary is relatively inexperienced in enforcing the
laws that exist, leading to a higher than usual degree of uncertainty as to the outcome of any litigation. Even where adequate
law exists in China, it may not be possible to obtain swift and equitable enforcement of that law. Further, various disputes may
be subject to the exercise of considerable discretion by agencies of the Chinese government, and forces and factors unrelated
to the legal merits of a particular matter or dispute may influence their determination. Continued uncertainty relating to the
laws in China and the application of the laws could have a material adverse effect upon us and our operations in China.
11
Controversies
Affecting China's Trade With The United States Could Harm Our Results Of Operations Or Depress Our Stock Price.
While
China has been granted permanent most favored nation trade status in the United States through its entry into the World Trade
Organization, controversies between the United States and China may arise that threaten the status quo involving trade between
the United States and China. These controversies could materially and adversely affect our business by, among other things, causing
our products in the United States to become more expensive, resulting in a reduction in the demand for our products by customers
in the United States, which would have a material adverse effect upon us and our results of operations. Further, political or
trade friction between the United States and China, whether or not actually affecting our business, could also materially and
adversely affect the prevailing market price of our common shares.
If
Our Factories Were Destroyed Or Significantly Damaged As A Result of Fire, Flood Or Some Other Natural Disaster, We Would Be Adversely
Affected
. All of our products are manufactured at our manufacturing facilities located in Xinxing, Guangdong, China. Fire-fighting
and disaster relief or assistance in China may not be as developed as in Western countries. We currently maintain property damage
insurance aggregating approximately $34 million covering our stock in trade, goods and merchandise, furniture and equipment and
buildings. We do not maintain business interruption insurance. Investors are cautioned that material damage to, or the loss of,
our factories due to fire, severe weather, flood or other act of God or cause, even if insured, could have a material adverse
effect on our financial condition, results of operations, business and prospects.
Our
Results Could Be Harmed If We Have To Comply With New Environmental Regulations.
Our operations create some environmentally
sensitive waste that may increase in the future depending on the nature of our manufacturing operations. The general issue of
the disposal of hazardous waste has received increasing attention from China's national and local governments and foreign
governments and agencies and has been subject to increasing regulation. Our business and operating results could be materially
and adversely affected if we were to increase expenditures to comply with any new environmental regulations affecting our operations.
12
Enforcement
Of The Labor Contract Law, Minimum Wage Increases And Future Changes In The Labor Laws In China May Result In The Continued Increase
In Labor Costs.
On June 29, 2007, the Standing Committee of the National People's Congress of China enacted the
Labor Contract Law, which became effective on January 1, 2008. The Labor Contract Law introduces specific provisions related
to fixed-term employment contracts, part-time employment, probation, consultation with labor union and employee assemblies, employment
without a written contract, dismissal of employees, severance and collective bargaining, which together represent enhanced enforcement
of labor laws and regulations. According to the Labor Contract Law, an employer is obliged to sign an unlimited-term labor contract
with any employee who has worked for the employer for 10 consecutive years. Further, if an employee requests or agrees to renew
a fixed-term labor contract that has already been entered into twice consecutively, the resulting contract must have an unlimited
term, with certain exceptions. The employer must also pay severance to an employee in nearly all instances where a labor contract,
including a contract with an unlimited term, is terminated or expires. In addition, the government has continued to introduce
various new labor-related regulations after the Labor Contract Law. Among other things, new annual leave requirements mandate
that annual leave ranging from 5 to 15 days is available to nearly all employees and further require that the employer compensate
an employee for any annual leave days the employee is unable to take in the amount of three times his daily salary, subject to
certain exceptions. In addition, as the interpretation and implementation of these new regulations are still evolving, we cannot
assure you that our employment practices do not, or will not, violate the Labor Contract Law and other labor-related regulations.
Between the fiscal years ended March 31, 2010 and 2014, we experienced an increase in the cost of labor caused by the increase
in the minimum hourly rate. In accordance with the new minimum wage set by the local authorities, we increased the minimum wage
for our labor in Shenzhen from RMB 1,100 (or approximately $162) per month to RMB 1,320 (or approximately $206) per month beginning
April 1, 2011. The minimum wage was increased to RMB 1,500 (or approximately $238) per month beginning February 1, 2012. The minimum
wage in Shenzhen was increased to RMB 1,600 (or approximately $254) per month beginning March 1, 2013, and later to RMB 1,808
(or approximately $293) per month beginning February 1, 2014. We started hiring workers in our Xinxing factory during the fiscal
year ended March 31, 2013, and the minimum wage at that time in Xinxing was RMB 1,010 per month (or approximately $160). Since
May 1, 2015, the minimum wage at Xinxing has been RMB 1,210 per month (or approximately $197 per month). We believe that increased
labor costs in China will have a significant effect on our total production costs and results of operations and that we will not
be able to continue to increase our production at our manufacturing facilities without substantially increasing our non-production
salaries and related costs. If we are subject to severe penalties or incur significant liabilities in connection with the enforcement
of the Labor Contract Law, disputes or investigations, our business and results of operations may be adversely affected. Any future
changes in the labor laws in the PRC could result in our having to pay increased labor costs. There can be no assurance that the
labor laws will not change, which may have a material adverse effect upon our business and our results of operations.
13
If
We Were To Lose Our Existing Banking Facilities Or Those Facilities Were Substantially Decreased Or Less Favorable Terms Were
Imposed Upon Us, The Company Could Be Materially And Adversely Affected.
We maintain banking facilities with Hang Seng Bank
Limited and China Construction Bank, which are subject to renewal on an annual basis. We use these banking facilities to fund
our working capital requirements. The credit markets in Hong Kong and throughout the world have tightened and experienced extraordinary
volatility and uncertainty. We have had discussions with several of our banks and believe that the availability of our banking
facilities will continue on terms that are acceptable to us. However, as a result of changes in the capital or other legal requirements
applicable to the banks or if our financial position and operations were to deteriorate further, our costs of borrowing could
increase or the terms of our banking facility could be changed so as to impact our liquidity. If we are unable to obtain needed
capital on terms acceptable to us, our business, financial condition, results of operations and cash flows could be materially
adversely affected.
In
July 2015, the Company entered into an agreement with an unaffiliated third party to sell part of the Company's land use
right in Xinxing, PRC for approximately $866,000. The area of this piece of land is approximately 18% of the total land area of
our Xinxing facility, and is included in the land use rights which were pledged as security for one of our banking facilities.
The Company is negotiating with the bank for the release of this parcel of land. However, the bank could block the sale of the
parcel or could demand that the Company repay the loan in full. In addition, the sale of the land could result in a reduction
of the value of the remaining land use right, which could make it more difficult for the Company to obtain similar credit limits
and acceptable credit terms in the future.
Risk
Factors Relating to Our Business
We
Depend Upon Our Largest Customers For A Significant Portion Of Our Sales Revenue, And We Cannot Be Certain That Sales To These
Customers Will Continue. If Sales To These Customers Do Not Continue, Then Our Sales Will Decline And Our Business Will Be Negatively
Impacted.
We have relied upon three customers for a significant portion of our sales. During the fiscal years ended March
31, 2013, 2014 and 2015, these three customers accounted for approximately 83%, 87% and 80% of sales, respectively. During the
fiscal year ended March 31, 2015, 37% of our sales were to a single customer (45% of our sales to another single customer during
the fiscal year ended March 31, 2014). We do not enter into long-term contracts with our customers but manufacture based upon
purchase orders and therefore cannot be certain that sales to these customers will continue. Our largest customer in 2013, which
accounted for 52% of our net sales in that year, represented 45% in 2014 and 24% in 2015. The loss of any of our largest customers
would likely have a material negative impact on our sales revenue and our business.
Defects
In Our Products Could Impair Our Ability To Sell Our Products Or Could Result In Litigation And Other Significant Costs.
Detection
of any significant defects in our products may result in, among other things, delay in time-to-market, loss of market acceptance
and sales of our products, diversion of development resources, injury to our reputation or increased warranty costs. Because our
products are complex, they may contain defects that cannot be detected prior to shipment. These defects could harm our reputation,
which could result in significant costs to us and could impair our ability to sell our products. The costs we may incur in correcting
any product defects may be substantial and could decrease our profit margins.
14
Since
certain of our products are used in applications that are integral to our customers' businesses, errors, defects or other
performance problems could result in financial or other damages to our customers, which would likely result in adverse effects
upon our business with these customers. If we were involved in any product liability litigation, even if it were unsuccessful,
it would be time-consuming and costly to defend. Further, our product liability insurance may not be adequate to cover claims.
Our
Sales Through Retail Merchants Result In Seasonality, Susceptibility To A Downturn In The Retail Economy And Sales Variances Resulting
From Retail Promotional Programs.
Many of our customers sell to retail merchants. Accordingly, these portions of our customer
base are susceptible to downturns in the retail economy. A greater number of our sales of scales products occur between the months
of July and October in preparation for the Christmas holiday. Throughout the remainder of the year, our products do not appear
to be subject to significant seasonal variation. However, past sales patterns may not be indicative of future performance.
Our
Customers Are Dependent On Shipping Companies For Delivery Of Our Products, And Interruptions To Shipping Could Materially And
Adversely Affect Our Business And Operating Results.
Typically, we sell our products either F.O.B. Hong Kong, Yantian (Shenzhen)
or Nansha (Guangzhou), and our customers are responsible for the transportation of products from Hong Kong, Yantian (Shenzhen)
or Nansha (Guangzhou) to their final destinations. Our customers rely on a variety of carriers for product transportation through
various world ports. A work stoppage, strike or shutdown of one or more major ports or airports could result in shipping delays
materially and adversely affecting our customers, which in turn could have a material adverse effect on our business and operating
results. Similarly, an increase in freight surcharges due to rising fuel costs or general price increases could materially and
adversely affect our business and operating results.
Customer
Order Estimates May Not Be Indicative Of Actual Future Sales.
Some of our customers have provided us with forecasts of their
requirements for our products over a period of time. We make many management decisions based on these customer estimates, including
purchasing materials, hiring personnel and other matters that may increase our production capacity and costs. If a customer reduces
its orders from prior estimates after we have increased our production capabilities and costs, this reduction may decrease our
net sales and we may not be able to reduce our costs to account for this reduction in customer orders. Many customers do not provide
us with forecasts of their requirements for our products. If those customers place significant orders, we may not be able to increase
our production quickly enough to fulfill the customers' orders. The inability to fulfill customer orders could damage our
relationships with customers and reduce our net sales.
15
Pressure
By Our Customers To Reduce Prices And Agree To Long-Term Supply Arrangements May Cause Our Net Sales Or Profit Margins To Decline.
Our customers are under pressure to reduce prices of their products. Therefore, we expect to experience increasing pressure
from our customers to reduce the prices of our products. Continuing pressure to reduce the price of our products could have a
material adverse effect upon our business and operating results. Our customers frequently negotiate supply arrangements with us
well in advance of placing orders for delivery within a year, thereby requiring us to commit to price reductions before we can
determine if we can achieve the assumed cost reductions. We believe we must reduce our manufacturing costs and obtain higher volume
orders to offset declining average sales prices. Further, if we are unable to offset declining average sales prices, our gross
profit margins will decline, which would have a material adverse effect upon our results of operations.
We
Depend Upon Our Key Personnel, And The Loss Of Any Key Personnel, Or Our Failure To Attract And Retain Key Personnel, Could Adversely
Affect Our Future Performance, Including Product Development, Strategic Plans, Marketing And Other Objectives.
The loss or
failure to attract and retain key personnel could significantly impede our performance, including product development, strategic
plans, marketing and other objectives. Our success depends to a substantial extent not only on the ability and experience of our
senior management, but particularly upon Anthony So, our Chairman of the Board. We do not have key man life insurance on Mr. So.
To the extent that the services of Mr. So would be unavailable to us, we would be required to obtain another person to perform
the duties Mr. So otherwise would perform. We may be unable to employ another qualified person with the appropriate background
and expertise to replace Mr. So on terms suitable to us.
Contractual
Arrangements We Have Entered Into Among Us And Our Subsidiaries May Be Subject To Scrutiny By The Respective Tax Authorities,
And A Finding That Bonso And Its Subsidiaries Owe Additional Taxes Could Substantially Reduce Our Consolidated Net Income And
The Value Of Your Investment.
We could face material and adverse tax consequences if the respective tax authorities determine
that the contractual arrangements among our subsidiaries and Bonso do not represent an arm's length price and adjust Bonso's,
or any of its subsidiaries', income in the form of a transfer pricing adjustment. Bonso did not consider it necessary to
make tax provision in this respect. However, there can be no assurance that the assessment performed by the local tax authorities
will result in the same position. A transfer pricing adjustment could, among other things, result in a reduction, for tax purposes,
of expense deductions recorded by Bonso or any of its subsidiaries, which could in turn increase its tax liabilities. In addition,
the tax authorities may impose late payment fees and other penalties on our affiliated entities for underpaid taxes. Our consolidated
net income may be materially and adversely affected if our affiliated entities' tax liabilities increase or if they are
found to be subject to late payment fees or other penalties.
16
Increased
Prices For Raw Materials May Have A Negative Impact Upon Us.
The price level of raw materials decreased slightly in the fiscal
year ended March 31, 2015, compared to that in the fiscal year ended March 31, 2014. The price of some of the raw materials fluctuates
directly with the price of oil. If oil prices were to increase in the future, it will likely result in an increase in the costs
of components to us, as well as an increase in our operating expenses, which could have a material adverse effect upon our business
and results of operations.
We
May Face An Increased Shortage Of Factory Workers.
Currently, we have a sufficient number of factory workers at our Xinxing
factory and do not expect a significant labor shortage in the next 12 months. However, there can be no assurance that we will
not experience an increased need for workers in China in the future or that we will be able to adequately staff our factory in
Xinxing in the future. The inability to adequately staff our factories could have a material adverse impact on production, which
could lead to delays in shipments or missed sales. In the event that we have delayed or lost sales, we may need to deliver goods
by air at our cost to ensure that our products arrive on time, which would likely result in an increase in air freight costs and
vendor fines and could result in missed sales, any of which could have a material adverse effect upon our business and our results
from operations
.
Recent
Changes In The PRC's Labor Law Could Penalize Bonso If It Needs To Make Additional Workforce Reductions
. In June 2007,
the National People's Congress of the PRC enacted new labor law legislation called the Labor Contract Law, which became
effective on January 1, 2008. It formalizes workers' rights concerning overtime hours, pensions, layoffs, employment contracts
and the role of trade unions. Considered as one of the strictest labor laws in the world, among other things, this new law requires
an employer to conclude an "open-ended employment contract" with any employee who either has worked for the employer
for 10 years or more or has had two consecutive fixed-term contracts. An "open-ended employment contract" is in effect
a lifetime, permanent contract, which is terminable only in specified circumstances, such as a material breach of the employer's
rules and regulations, or for a serious dereliction of duty. Under the new law, downsizing by 20% or more of each individual entity
may occur only under specified circumstances, such as a restructuring undertaken pursuant to China's Enterprise Bankruptcy
Law, or where a company suffers serious difficulties in production and/or business operations. Also, if we lay off more than 20
employees at one time, we have to communicate with the labor union of our Company and report to the District Labor Bureau. During
the fiscal year ended March 31, 2014, we paid severance payments of $1,194,000 for reducing our full workforce in Shenzhen, PRC
as we moved our operations to the new factory in Xinxing, and the accumulated provision was approximately $256,000 as of March
31, 2015. (2014: $156,000; 2013: $743,000). This accrued severance payment allowance is reviewed every year. We may incur much
higher costs under China's labor laws if we are forced to downsize again, and accordingly, this new labor law may exacerbate
the adverse effect of the economic environment on our financial results and financial condition.
17
We
Face Increasing Competition In Our Industry And May Not Be Able To Successfully Compete With Our Competitors.
Our business
is in an industry that is becoming increasingly competitive, and many of our competitors, both local and international, have substantially
greater technical, financial and marketing resources than we have. As a result, we may be unable to compete successfully with
these competitors. We compete with scale manufacturers in the Far East, the United States and Europe. We believe that our principal
competitors in the scale market are other original equipment manufacturers ("OEMs") and original design manufacturers
("ODMs"), and all companies engaged in the branded, ODM and OEM business. The scale market is highly competitive,
and we face pressures on pricing which could result in lower margins. Lower margins may affect our ability to cover our costs,
which could have a material negative impact on our operations and our business.
We
Are Controlled By Our Management, Whose Interests May Differ From Those Of The Other Shareholders.
As of July 15, 2015, Mr.
Anthony So, our founder and Chairman, beneficially owned approximately 46.5% of our common stock (43.5% of our issued and outstanding
shares after eliminating 330,736 shares held as treasury stock ("Treasury Stock")). Andrew So, our Chief Operating
Officer and President, beneficially owned approximately 12.8% of our common stock (8.6% of our issued and outstanding shares after
eliminating Treasury Stock). Albert So, our Chief Financial Officer, beneficially owned approximately 6.9% of our common stock
(4.8% of our issued and outstanding shares after eliminating Treasury Stock). The record ownership of Mr. Anthony So, Mr. Andrew
So and Mr. Albert So aggregates 56.9% of the shares entitled to vote. The other directors of the Company own of record 3.7% of
the shares entitled to vote. Accordingly, the existing management and directors of the Company can vote in the aggregate 60.6%
of the shares entitled to vote. As a result, the current directors and management of the Company are in a position to elect the
Board of Directors and, therefore, to control our business and affairs, including certain significant corporate actions such as
acquisitions, the sale or purchase of assets and the issuance and sale of our securities. The current directors and management
may be able to prevent or cause a change in control of the Company. We also may be prevented from entering into transactions that
could be beneficial to us without the current directors' and management's consent. The interest of our largest shareholders
may differ from the interests of other shareholders. There are no agreements, understandings or commitments among the members
of the Board to vote their shares in any specific manner or to vote collectively for or against any matter that may come before
the shareholders.
We
have identified material weaknesses in our internal control over financial reporting which could, if not remediated, result in
material misstatements in our financial statements.
We are responsible for establishing and maintaining adequate internal
control over our financial reporting, as required by Rule 13a-15 under the Securities Exchange Act of 1934. As disclosed
in Item 15 – "Controls and Procedures," we have identified, in conjunction with our independent auditors,
certain material weaknesses in our internal control over financial reporting related to our financial closing process, the lack
of trained accounting personnel and the failure to enter certain transactions into the accounting records on a timely basis.
18
A
material weakness is defined as a deficiency, or combination of deficiencies, in internal control over financial reporting, such
that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be
prevented or detected on a timely basis. As a result of these material weaknesses, our management concluded that our internal
control over financial reporting was not effective as of March 31, 2015, based on criteria set forth by the 2013 Internal Control—Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. During the fiscal year ended March 31,
2015, the Company took remediation measures (as discussed in Item 15) to address certain deficiencies noted in our Form 20-F for
the fiscal year ended March 31, 2014.
As
discussed in Item 15, we are developing and intend to implement remediation plans designed to address these material weaknesses;
however, the material weaknesses will not be remediated until the necessary controls have been implemented and are determined
to be operating effectively. We do not know the specific time frame needed to fully remediate the material weaknesses identified.
We cannot assure you that our efforts to fully remediate these internal control weaknesses will be successful or that similar
material weaknesses will not recur. If our remedial measures are insufficient to address the material weaknesses, or if additional
material weaknesses or significant deficiencies in our internal control are discovered or occur in the future, our consolidated
financial statements may contain material misstatements and we could be required to restate our financial results.
Notwithstanding
the identified material weaknesses, management believes the consolidated financial statements included in this Annual Report on
Form 20-F fairly present in all material respects our financial condition, results of operations and cash flows at and for the
periods presented in accordance with U.S. GAAP.
Due
To Inherent Limitations, There Can Be No Assurance That Our System Of Disclosure And Internal Controls And Procedures Will Be
Successful In Preventing All Errors Or Fraud Or In Informing Management Of All Material Information In A Timely Manner.
Our
disclosure controls and internal controls and procedures may not prevent all errors and all fraud. A control system, no matter
how well-conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system
are met. Further, the design of a control system reflects that there are resource constraints, and the benefits of controls must
be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can
provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been or will be detected.
These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur
simply because of error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion
of two or more people or by circumvention of the internal control procedures. The design of any system of controls also is based
in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed
in achieving its stated goals under all potential future conditions; over time, a control may become inadequate because of changes
in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations
in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected.
19
There
Are Inherent Uncertainties Involved In Estimates, Judgments And Assumptions Used In The Preparation Of Financial Statements In
Accordance With U.S. GAAP. Any Changes In Estimates, Judgments And Assumptions Could Have A Material Adverse Effect On Our Business,
Financial Position And Results Of Operations.
The consolidated financial statements included in the periodic reports we file
with the SEC are prepared in accordance with U.S. GAAP. The preparation of financial statements in accordance with U.S. GAAP involves
making estimates, judgments and assumptions that affect reported amounts of assets (including intangible assets), liabilities
and related reserves, revenues, expenses and income. Estimates, judgments and assumptions are inherently subject to changes in
the future, and any such changes could result in corresponding changes to the amounts of assets, liabilities, revenues, expenses
and income. Any such changes could have a material adverse effect on our financial position and results of operation.
Compliance
Costs With The Securities Laws The Sarbanes-Oxley Act of 2002 ("Sarbanes-Oxley Act"), The Wall Street Reform and Consumer
Protection Act ("Dodd-Frank Act"), And Other Regulatory Initiatives Will Increase Our Costs.
Changes in corporate
governance practices due to the Dodd-Frank Act and the Sarbanes-Oxley Act, changes in the continued listing rules of the NASDAQ
Stock Market, new accounting pronouncements and new regulatory legislation, rules or accounting changes have increased our cost
of being a U.S. public company and may have an adverse impact on our future financial position and operating results.
.
These regulatory changes and other legislative initiatives have made some activities more time-consuming
and have increased financial compliance and administrative costs for public companies, including foreign private issuers like
us. In addition, any future changes in regulatory legislation, rules or accounting may cause our legal and accounting costs to
further increase. In addition, these new rules and regulations require increasing time commitments and resource commitments from
our company, including from senior management. This increased cost could negatively impact our earnings and have a material adverse
effect on our financial position and results of operations. Further, the new rules may increase the expenses associated with our
director and officer liability insurance.
During
the Fiscal Year Ended March 31, 2014, We Inadvertently Violated Section 402 of the Sarbanes-Oxley Act and Section 13(k) Of The
Securities Exchange Act And May Be Subject To Sanctions For Such Violations.
Section
13(k) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") provides that it is unlawful for a company
such as ours, which has a class of securities registered under Section 12(b) of the Exchange Act to, directly or indirectly, including
through any subsidiary, extend or maintain credit in the form of a personal loan to or for any director or executive officer of
the company. Issuers violating Section 13(k) of the Exchange Act may be subject to civil sanctions, including injunctive remedies
and monetary penalties, as well as criminal sanctions. The imposition of any of such sanctions on the Company may have a material
adverse effect on our business, financial position, results of operations or cash flows.
20
During
the fiscal year ended March 31, 2014, we made loans aggregating approximately $1,052,000 to our Chairman and Chief Executive Officer
Anthony So. Management believed at the time that the loans were made that these loans were permissible and did not violate Section
13(k) of the Exchange Act, because Mr . Anthony
So would be able to repay the full amount by foregoing
his salary and accrued annual leave payments until the loans had been paid in full.
We
advanced the funds to Mr. So on two separate occasions, and Mr. Anthony So directed that his salary payments and accrued
annual leave payments be used to offset the amounts that we loaned to him. In addition, Mr. Albert So and Mr. Andrew So, who
are officers and directors of the Company, directed the Company to use their accrued annual leave payments to partially
satisfy the amounts due to the Company from Mr. Anthony So. On March 31, 2014, the amount due to the Company from Mr. Anthony
So was $166,157. On August 7, 2014, Mr. Anthony So paid $166,157 to the Company to fully repay the amounts loaned to him. The
loans were non-interest bearing. See "Major Shareholders and Related Party Transactions."
Notwithstanding
Mr., Anthony So's repayment in full of the loans made to him, those loans constitute a violation of Section 13(k) of the
Exchange Act and Section 402(a) of the Sarbanes-Oxley Act.
As
a result of this inadvertent violation, the Board adopted a policy regarding loans or advances to any Executive Officer or Director
of the Company. The policy provides that "The Company shall not directly or indirectly, including through any subsidiary,
extend or maintain credit to, or arrange for the extension of credit, or renew an extension of credit, in the form of a personal
loan to or for any Director or Executive Officer (or equivalent thereof) of the Company or any subsidiary of the Company."
Our
Operating Results And Stock Price Are Subject To Wide Fluctuations.
Our quarterly and annual operating results are affected
by a wide variety of factors that could materially and adversely affect net sales, gross profit and profitability. This could
result from any one or a combination of factors, many of which are beyond our control. Results of operations in any period should
not be considered indicative of results to be expected in any future period, and fluctuations in operating results may also result
in fluctuations in the market price of our common stock.
21
Our
Results Could Be Affected By Changes In Currency Exchange Rates.
Changes in currency rates involving the Hong Kong Dollar
or Chinese Renminbi could increase our expenses. During the fiscal years ended March 31, 2013, 2014 and 2015, our financial results
were affected by currency fluctuations, resulting in a total foreign exchange loss of approximately $261,000, $444,000 and $134,000,
respectively. Generally, our revenues are collected in United States Dollars. Our costs and expenses are paid in United States
Dollars, Hong Kong Dollars and Chinese Renminbi. We face a variety of risks associated with changes among the relative value of
these currencies. Appreciation of the Chinese Renminbi against the Hong Kong Dollar and the United States Dollar would increase
our expenses when translated into United States Dollars and could materially and adversely affect our margins and results of operations.
If the trend of Chinese Renminbi appreciation continues against the Hong Kong Dollar and the United States Dollar, our operating
costs will further increase and our financial results will be adversely affected. In addition, a significant devaluation in the
Chinese Renminbi or Hong Kong Dollar could have a material adverse effect upon our results of operations. If we determined to
pass onto our customers through price increases the effect of increases in the Chinese Renminbi relative to the Hong Kong Dollar
and the United States Dollar, it would make our products more expensive in global markets, such as the United States and the European
Union. This could result in the loss of customers, who may seek, and be able to obtain, products and services comparable to those
we offer in lower-cost regions of the world. If we did not increase our prices to pass on the effect of increases in the Chinese
Renminbi relative to the Hong Kong Dollar and the United States Dollar, our margins and profitability would suffer.
Protection
And Infringement Of Intellectual Property.
We have no patents, licenses, franchises, concessions or royalty agreements that
are material to our business. We have obtained a trademark registration in Hong Kong for the marks BONSO and MODUS in connection
with certain electronic apparatus. Unauthorized parties may attempt to copy aspects of our products or trademarks or to obtain
and use information that we regard as proprietary. Policing unauthorized use of our products is difficult. Our means of protecting
our proprietary rights may not be adequate. In addition, the laws of some foreign countries do not protect our proprietary rights
to as great an extent as do the laws of the United States. Our failure to adequately protect our proprietary rights may allow
third parties to duplicate our products or develop functionally equivalent or superior technology. In addition, our competitors
may independently develop similar technology or design around our proprietary intellectual property.
22
Further,
we may be notified that we are infringing patents, trademarks, copyrights or other intellectual property rights owned by other
parties. In the event of an infringement claim, we may be required to spend a significant amount of money to develop a non-infringing
alternative or to obtain licenses. We may not be successful in developing such an alternative or obtaining a license on reasonable
terms, if at all. Any litigation, even without merit, could result in substantial costs and diversion of resources and could have
a material adverse effect on our business and results of operations.
Cancellations
Or Delays In Orders Could Materially And Adversely Affect Our Gross Margins And Operating Income.
Sales to our OEM customers
are primarily based on purchase orders we receive from time to time rather than firm, long-term purchase commitments. Although
it is our general practice to purchase raw materials only upon receiving a purchase order, for certain customers we will occasionally
purchase raw materials based on such customers' rolling forecasts. Further, during times of potential component shortages
we have purchased, and may continue to purchase, raw materials and component parts in the expectation of receiving purchase orders
for products that use these components. In the event actual purchase orders are delayed, are not received or are canceled, we
would experience increased inventory levels or possible write-downs of raw material inventory that could materially and adversely
affect our business and operating results.
We
Generally Have No Written Agreements With Suppliers To Obtain Components, And Our Margins And Operating Results Could Suffer From
Increases In Component Prices.
We are typically responsible for purchasing components used in manufacturing products for our
customers. We generally do not have written agreements with our suppliers of components. This typically results in our bearing
the risk of component price increases because we may be unable to procure the required materials at a price level necessary to
generate anticipated margins from the orders of our customers. Prices of components may increase in the future for a variety of
reasons. Accordingly, additional increases in component prices could materially and adversely affect our gross margins and results
of operations.
We
may encounter difficulties in obtaining approval to redevelop our Shenzhen Factory Land, which could adversely affect our growth
and business prospects.
As
part of our ongoing business strategy we intend to focus our efforts on redeveloping our Shenzhen factory into a high-end commercial
complex containing retail space, office space and some residential space. We anticipate that it will take several years to obtain
all necessary governmental approvals for us to redevelop the Shenzhen factory, and we think it is likely that we will obtain the
necessary approvals. However, there can be no assurance that we will be able to obtain all requisite permits and approvals from
relevant government authorities in relation to the redevelopment of the land, and the development of the commercial complex. Our
planned real estate project is subject to significant risks and uncertainties, including without limitation the following:
23
•
we
                                         do not currently have strong brand recognition or relationships in the real estate development
                                         and management business;
•
we
                                         may not be able to obtain all necessary government approvals or all requisite permits
                                         and approvals from relevant government authorities in relation to the redevelopment of
                                         the land, or to successfully redevelop the land in a timely manner;
•
we
                                         face intense competition from real estate developers that are already in the business
                                         for years;
•
our
                                         experience and expertise gained from our manufacturing business may not be particularly
                                         relevant or applicable to a real estate development and management business; and
•
we
                                         may not be able to generate enough revenues to offset our costs in our real estate development
                                         and management business.
If
we are not successful in development of our property development project, our growth, business, financial condition and results
of operations could be adversely affected.
We
may not have adequate financing, whether through bank loans or other arrangements, to fund the redevelopment of our Shenzhen factory
site, and capital resources may not be available on commercially reasonable terms, or at all.
Redevelopment
of our Shenzhen factory will require us to make a significant investment. Property development is capital intensive, and we do
not currently have the necessary capital to fund the redevelopment project. We plan to finance our property redevelopment from
our cash on hand, bank facilities and other sources. We cannot assure you that lenders will grant us sufficient financing in the
future to fully fund the redevelopment project or that funding will be available from other sources. Further, the financing policies
of the PRC government relating to the property development sector have varied. It is possible that the PRC government may further
tighten financing policies on PRC financial institutions for the property development sector. These property-related financing
policies may limit our ability and flexibility to use bank borrowings to finance our property redevelopment project.
24
We
may fail to obtain, or experience material delays in obtaining, requisite certificates, licenses, permits or governmental approvals
for redevelopment of our Shenzhen factory, and as a result our redevelopment plans, business, results of operations and financial
condition may be materially and adversely affected.
Property
development in the PRC is heavily regulated. Property developers in China must abide by various laws and regulations, including
implementation rules promulgated by local governments to enforce these laws and regulations. During various stages of our property
redevelopment project, we will be required to obtain and maintain various certificates, licenses, permits, certificates and governmental
approvals, including but not limited to qualification certificates, land use rights certificates, construction land planning permits,
construction works planning permits, construction works commencement permits, pre-sale permits and completion certificates. Before
the government authorities issue any certificate, license or permit, we must also meet specific conditions. We cannot assure you
that we will be able to adapt to new PRC land policies that may come into effect from time to time with respect to the property
development industry or that we will not encounter other material delays or difficulties in fulfilling the necessary conditions
to obtain all necessary certificates, licenses or permits for our property development in a timely manner, or at all, in the future.
If we fail to obtain or encounter significant delays in obtaining the necessary certificates, licenses or permits we will not
be able to continue with our redevelopment plans, and our business, results of operations and financial condition may be adversely
affected.
Certain
Legal Consequences of Foreign Incorporation and Operations
Judgments
Against The Company And Management May Be Difficult To Obtain Or Enforce.
We are a holding corporation organized as an International
Business Company under the laws of the British Virgin Islands ("BVI"), and our principal operating subsidiaries are
organized under the laws of Hong Kong and the laws of the PRC. Our principal executive offices are located in Hong Kong and the
PRC. Outside the United States, it may be difficult for investors to enforce judgments obtained against us in actions brought
in the United States, including actions predicated upon the civil liability provisions of United States federal securities laws.
In addition, most of our officers and directors reside outside the United States, and the assets of these persons are located
outside the United States. As a result, it may not be possible for investors to effect service of process within the United States
upon these persons or to enforce against the Company or these persons judgments predicated upon the liability provisions of United
States federal securities laws. Our Hong Kong counsel and our British Virgin Islands counsel have advised that there is substantial
doubt as to the enforceability against us or any of our directors or officers in original actions or in actions for enforcement
of judgments of United States courts in claims for liability based on the civil liability provisions of United States federal
securities laws.
25
No
treaty exists between Hong Kong or the British Virgin Islands and the United States providing for the reciprocal enforcement of
foreign judgments. However, the courts of Hong Kong and the British Virgin Islands are generally prepared to accept a foreign
judgment as evidence of a debt due. An action may then be commenced in Hong Kong or the British Virgin Islands for recovery of
this debt. A Hong Kong or British Virgin Islands court will only accept a foreign judgment as evidence of a debt due if:
•
the
                                         judgment is for a liquidated amount in a civil matter;
•
the
                                         judgment is final and conclusive;
•
the
                                         judgment is not, directly or indirectly, for the payment of foreign taxes, penalties,
                                         fines or charges of a like nature (in this regard, a Hong Kong court is unlikely to accept
                                         a judgment for an amount obtained by doubling, trebling or otherwise multiplying a sum
                                         assessed as compensation for the loss or damage sustained by the person in whose favor
                                         the judgment was given);
•
the
                                         judgment was not obtained by actual or constructive fraud or duress;
•
the
                                         foreign court has taken jurisdiction on grounds that are recognized by the common law
                                         rules as to conflict of laws in Hong Kong or the British Virgin Islands;
•
the
                                         proceedings in which the judgment was obtained were not contrary to natural justice (i.e.
                                         the concept of fair adjudication);
•
the
                                         proceedings in which the judgment was obtained, the judgment itself and the enforcement
                                         of the judgment are not contrary to the public policy of Hong Kong or the British Virgin
                                         Islands;
•
the
                                         person against whom the judgment is given is subject to the jurisdiction of a foreign
                                         court; and
•
the
                                         judgment is not on a claim for contribution in respect of damages awarded by a judgment,
                                         which fall under Section 7 of the Protection of Trading Interests Ordinance, Chapter
                                         7 of the Laws of Hong Kong.
Enforcement
of a foreign judgment in Hong Kong or the British Virgin Islands may also be limited or affected by applicable bankruptcy, insolvency,
liquidation, arrangement and moratorium, or similar laws relating to or affecting creditors' rights generally, and will
be subject to a statutory limitation of time within which proceedings may be brought.
Because
We Are Incorporated In The British Virgin Islands, You May Not Have The Same Protections As Shareholders Of U.S. Corporations.
We are organized under the laws of the British Virgin Islands. Principles of law relating to matters affecting the validity
of corporate procedures, the fiduciary duties of our management, directors and controlling shareholders and the rights of our
shareholders differ from, and may not be as protective of shareholders as, those that would apply if we were incorporated in a
jurisdiction within the United States. Our directors have the power to take certain actions without shareholder approval, including
amending our Memorandum or Articles of Association, which are the terms used in the British Virgin Islands for a corporation's
charter and bylaws, respectively, and approving certain fundamental corporate transactions, including reorganizations, certain
mergers or consolidations and the sale or transfer of assets. In addition, there is doubt that the courts of the British Virgin
Islands would enforce liabilities predicated upon United States federal securities laws.
26
Future
Issuances Of Preference Shares Could Materially And Adversely Affect The Holders Of Our Common Shares Or Delay Or Prevent A Change
Of Control.
Our Memorandum and Articles of Association provide the ability to issue an aggregate of 10,000,000 shares of preferred
stock in four classes. While no preferred shares are currently issued or outstanding, we may issue preferred shares in the future.
Future issuance of preferred shares could materially and adversely affect the rights of the holders of our common shares, dilute
the common shareholders' holdings or delay or prevent a change of control.
Our
Shareholders Do Not Have The Same Protections Or Information Generally Available To Shareholders Of U.S. Corporations Because
The Reporting Requirements For Foreign Private Issuers Are More Limited Than Those Applicable To Public Corporations Organized
In The United States.
We are a foreign private issuer within the meaning of rules promulgated under the Securities Exchange
Act of 1934 (the "Exchange Act"). We are not subject to certain provisions of the Exchange Act applicable to United
States public companies, including: the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on
Form 10-Q or current reports on Form 8-K, the sections of the Exchange Act regulating the solicitation of proxies, consents or
authorizations with respect to a security registered under the Exchange Act and the sections of the Exchange Act requiring insiders
to file public reports of their stock ownership and trading activities and establishing insider liability for profits realized
from any "short-swing" trading transaction (i.e., a purchase and sale, or sale and purchase, of the issuer's
equity securities within six months or less). Because we are not subject to these rules, our shareholders are not afforded the
same protections or information generally available to investors in public companies organized in the United States.
Our
Board's Ability To Amend Our Charter Without Shareholder Approval Could Have Anti-Takeover Effects That Could Prevent A
Change In Control.
As permitted by the laws of the British Virgin Islands, our Memorandum and Articles of Association may
be amended by our Board of Directors without shareholder approval. This includes amendments to increase or reduce our authorized
capital stock. Our Board's ability to amend our charter documents without shareholder approval could have the effect of
delaying, deterring or preventing a change in control of Bonso, including a tender offer to purchase our common shares at a premium
over the current market price.
We
Have Not Paid Dividends Since 2007 And May Not Pay Dividends In The Future.
We have not paid dividends on our common stock
since 2007, and we may not be able to declare dividends, or the Board of Directors may decide not to declare dividends, in the
future. We will determine the amounts of any dividends when and if they are declared, in the future at the time of declaration.
27
Item
4. Information on the Company
History
and Development of the Company
Bonso
Electronics International Inc. was formed on August 8, 1988 as a limited liability International Business Company under the laws
of the British Virgin Islands under the name "Golden Virtue Limited." On September 14, 1988, we changed our name to
Bonso Electronics International Inc. We operate under the BVI Business Companies Act.
Effective
as of May 1, 2001 we acquired 100% of the equity of Korona Haushaltswaren GmbH & Co. KG, a limited liability partnership registered
in Germany ("Korona"). Korona marketed consumer scale products throughout Europe to retail merchandisers and distributors.
Effective March 31, 2009, we sold certain assets of Korona to Beurer GmbH, including inventories, accounts receivable, toolings
and intellectual property rights. Korona completed its liquidation in February 2012.
Effective
as of August 1, 2002, we acquired 51% of the equity of Gram Precision Scales Inc. ("Gram Precision"). Gram Precision
was primarily engaged in the distribution and marketing of pocket scales in the United States, Canada and Europe. Effective November
1, 2008, we sold our 51% of the equity of Gram Precision to Mohan Thadani, the founder of Gram Precision.
In
April 2007, we formed a wholly-owned subsidiary, Bonso USA, Inc., a Nevada corporation ("Bonso USA"), to focus on the
sales of industrial scales in the U.S. market. Bonso USA has been dormant since 2009 and no business activities are being conducted
by this subsidiary.
For
a description of our current operating subsidiaries, see "Organizational Structure," below.
Our
corporate administrative matters are conducted through our registered agent, HWR Services Limited, P.O. Box 71, Road Town, Tortola,
British Virgin Islands. Our principal executive offices are located at Unit 1404, 14/F, Cheuk Nang Centre, 9 Hillwood Road, Tsimshatsui,
Kowloon, Hong Kong. Our telephone number is (852) 2605-5822, our facsimile number is (852) 2691-1724, our e-mail address is info@bonso.com
and our website is www.bonso.com.
28
Business
Overview
Bonso
Electronics International Inc. designs, develops, produces and sells electronic sensor-based and wireless products for private
label original equipment manufacturers (individually "OEM" or, collectively, "OEMs"), original brand manufacturers
(individually "OBM" or, collectively, "OBMs") and original design manufacturers (individually, "ODM"
or, collectively, "ODMs").
Since
1989, we have manufactured all of our products in China in order to take advantage of the lower overhead costs and competitive
labor rates. From 1989 until 2013, all of our production took place in our Shenzhen factory; however, during the fiscal year ended
March 31, 2013 we began production in our Xinxing factory. We moved all production processes from our Shenzhen factory to the
Xinxing factory during the fiscal year ended March 31, 2014, and we rented out the old Shenzhen factory to a third party as a
source of rental income.
Our
primary business has been the design, development, production and sale of electronic sensor-based and wireless products. Effective
with the transfer of manufacturing operations to our new factory in Xinxing we leased our factory in Shenzhen to a third party.
This lease marks our entry into the "property" business. The lease with the third party terminates in August 2019.
We intend to begin the process of seeking the necessary governmental approvals to permit us to redevelop the Shenzhen factory
into a high end commercial complex, containing retail space, office space and some residential space. If we are successful in
obtaining the necessary governmental approvals for the redevelopment, we believe that the rental income derived from leasing the
redeveloped property will be a significant contributing factor to our profit in the future.
Our
principal capital expenditures on property, plant and equipment over the last three years are set forth below:
2013
2014
2015
Property
    plant & equipment and land use rights
$1,412,000
$2,898,000
$1,645,000
29
Our
capital expenditures include construction-in-progress, leasehold improvement and the purchase of machinery used in the production
of certain of our products.
All
of the foregoing capital expenditures were financed principally from internally generated funds, except for two motor vehicles
purchased with capital leases.
Products
Our
sensor-based scale products include bathroom, kitchen, office, jewelry, laboratory, postal and industrial scales that are used
in consumer, commercial and industrial applications. These products accounted for 90% of revenue for the fiscal year ended March
31, 2013, 95% for 2014 and 89% for 2015. We believe that our sensor-based scale products will continue to be a major portion of
our scales revenue as we are able to secure orders from our major customers.
During
the fiscal year ended March 31, 2013, the Company began to produce certain electrical pet care products, including a bark control
device. These products accounted for 10% of revenue for the fiscal year ended March 31, 2015, 4% for 2014 and 8% for 2013.
We
also receive revenue from certain customers for the development and manufacture of tooling and molding for scales and pet electronics
products although most of the tools and moulds which we produce are used by us for the manufacture of our products. We also generate
some sales of scrap materials. These revenues accounted for approximately 2% of net sales for the fiscal year ended March 31,
2013, 1% for 2014 and 1% for 2015.
The
following table sets forth the percentage of net sales for each of the product lines mentioned above for the fiscal years ended
March 31, 2013, 2014, and 2015:
Year ended March 31
,
Product Line
2013
2014
2015
Scales
90
%
95
%
89
%
Pet Electronics Products
8
%
4
%
10
%
Others
2
%
1
%
1
%
Total
100
%
100
%
100
%
30
Business
Strategy
We
believe that our future growth depends upon our ability to eliminate or decrease the manufacture and sale of lower margin products,
strengthen our customer base by enhancing and diversifying our products, increasing the number of customers and expanding into
additional markets while maintaining or increasing sales of our products to existing customers, and focusing upon the production
and sale of higher margin products. Our future growth and our ability to become profitable are also dependent upon our ability
to control production costs and increase production capacity. Our strategy to achieve these goals is as follows:
Increased
Focus Upon Manufacturing and Selling Higher Margin Products and the Elimination or Decrease in the Production and Sale of Lower
Margin Products.
In seeking to return to profitability, we analyzed our product mix and concluded that we were most likely
to return to profitability if we eliminated the production and sale of lower margin products that require the employment of larger
numbers of workers and the commitment of substantial resources to carry or stock raw materials and components inventory. We advised
our largest customer for these low margin electronic scale products that without substantial price increases, we would not be
in position to continue manufacturing these products in the calendar year beginning January 1, 2015. That customer did not agree
to the price increases that we requested, and has shifted this business to alternative suppliers. We are optimistic that this
will result in improved profitability for the Group.
Product
Enhancement And Diversification.
We continually seek to improve and enhance our existing products in order to provide a longer
product life-cycle and to meet increasing customer demands for additional features. Our research and development staff are currently
working on a variety of projects to enhance our existing scale products and in the postal scale/meter area. Further, we are developing
certain electrical pet care products. See "Product Research and Development" and "Competition," below.
Maintaining
And Expanding Business Relations With Existing Customers.
We promote relationships with our significant customers through
regular communication, including visiting certain of our customers in their home countries and providing direct access to our
manufacturing and quality control personnel. This access, together with our concern for quality, has resulted in a relatively
low level of defective products. Moreover, we believe that our emphasis on timely delivery, good service and low cost has contributed,
and will continue to contribute, to good relations with our customers and increased orders. Further, we solicit suggestions from
our customers for product enhancement and when feasible, attempt to develop and incorporate the enhancements suggested by our
customers into our products.
31
Controlling
Production Costs
. In 1989, recognizing that labor cost was a major factor permitting effective competition in the consumer
electronic products industry, we relocated all of our manufacturing operations to China to take advantage of the large available
pool of lower-cost manufacturing labor. Continuing this approach and recognizing that labor costs are significantly lower in Xinxing
than in Shenzhen, we moved all of our manufacturing from Shenzhen to Xinxing, and there was a reduction in our labor costs as
a result. In addition, we have continued to shift production and manufacturing of various parts and components to third party
suppliers, including plastic injection molded parts and metal parts. In some cases, we have entered into agreements with third
parties in which they lease our equipment from us, and then manufacture parts and components that we use in assembling our final
products. Those third parties provide the workers and supervisors, and the necessary raw materials. We lease our machinery or
equipment, our dormitory facilities for their workers and supervisory staff and our meals or cafeteria services for the third
party's workers and staff. There are other third party contractors that utilize their own equipment and their own facilities
in manufacturing specific components or parts for us.
We
are actively seeking to control production costs by such means as redesigning our existing products in order to decrease material
and labor costs, controlling the number of our employees, increasing the efficiency of workers by providing regular training and
tools and redesigning the flow of our production lines.
New
Manufacturing Facility
. In November 2006, Bonso entered into a land purchase agreement to acquire 133,500 square meters of
land use right for future expansion in Xinxing, China. We have completed construction of the new manufacturing facility and moved
all manufacturing operations from Shenzhen to Xinxing. The office building on the Xinxing site was completed in February 2015,
and we expect to complete leasehold renovations by December 2015. We intend to carefully monitor our capacity needs and to expand
capacity as necessary in the future.
Customers
and Marketing
We
sell our products primarily in the United States and Europe. Customers for our products are primarily OEMs, OBMs and ODMs which
market the products under their own brand names. We market our products to OEMs, OBMs and ODMs through our sales staff at trade
shows and via e-mail, our website and facsimile.
Net
export sales to customers by geographic area constituting 10% or more of total sales of the Company consisted of the following
for each of the three years ended March 31, 2013, 2014 and 2015.
32
Year
ended March 31:
2013
2014
2015
$ in thousands
%
$ in thousands
%
$ in thousands
%
United States of America
23,804
78
25,203
81
21,271
73
Germany
5,121
17
4,688
15
6,210
22
Total
28,925
95
29,891
96
27,481
95
We
maintain a marketing and sales team of five people. Also, our experienced engineering teams work directly with our customers to
develop and tailor our products to meet the customers' specific needs. We market our products primarily through a combination
of direct contact by our experienced in-house technical sales staff and through trade shows and via e-mail, our website and facsimile.
No commission payments were paid to the sales team during the fiscal years ended March 31, 2013, 2014 and 2015.
Our
major sensor-based electronic scale products and pet electronic products customers and their percentage of sales for the prior
three fiscal years are below:
Percent
of Sales – Year ended March 31:
Customers
2013
2014
2015
Sunbeam Products, Inc.
52
%
45
%
24
%
Fitbit, Inc.
18
%
33
%
37
%
Kern + Sohn GMBH
13
%
9
%
19
%
Component
Parts and Suppliers
We
purchase over 1,000 different component parts from more than 100 major suppliers and are not dependent upon any single supplier
for key components. We purchase components for our products primarily from suppliers in Japan, Taiwan, Hong Kong and China.
33
The
price of oil and other raw materials increased during the fiscal years ended March 31, 2011 and 2012 resulting in an increase
of our component part prices. We have taken steps to reduce our exposure to any inability to obtain components by forecasting
with an increased buffer rate and placing orders for components earlier and allowing for longer delivery lead times. Because of
these actions, we do not expect to experience any difficulty in obtaining needed component parts for our products. The price level
of raw materials remained stable in the fiscal year ended March 31, 2014, compared to that in the fiscal year ended March 31,
2013 and decreased slightly in the fiscal year ended March 31, 2015 compared to that in the fiscal year ended March 31, 2014.
Quality
Control
We
have received ISO 9001:2008 certification from BSI Assurance UK Limited. The ISO 9001:2008 certification was awarded to our subsidiary,
Bonso Advanced Technology (Xinxing) Company Limited. ISO 9001 is one of the ISO 9000 series of quality system standards developed
by the International Organization for Standardization, a worldwide federation of national standards bodies. ISO 9001 provides
a model for quality assurance (and continuous improvement) in product development, manufacturing, installation and servicing that
focuses on meeting customer requirements.
The
European Union has enacted the Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment Directive
("RoHS"). RoHS prohibits the use of certain substances, including lead, in certain products. We believe that we are
in compliance with RoHS and have a supply of compliant components from suppliers.
The
Company provides to certain customers an additional one to two percent of certain products ordered in lieu of a warranty, which
are recognized as cost of sales when these products are shipped to customers from our facility. In addition, certain products
sold by the Company are subject to a limited product quality warranty. The Company accrues for estimated incurred but unidentified
quality issues based upon historical activity and known quality issues if a loss is probable and can be reasonably estimated.
The standard limited warranty period is one to three years. Quality returns, refunds, rebates and discounts are recorded net of
sales if they are within the warranty period. All sales are based upon firm orders with fixed terms and conditions, which generally
cannot be modified. Historically, we have not experienced material differences between our estimated amounts of quality returns,
refunds, rebates and discounts and the actual results. Our contracts do not contain price protection or similar privileges in
relation to the sale of goods.
34
Patents,
Licenses, Trademarks, Franchises, Concessions and Royalty Agreements
We
have obtained a trademark registration in Hong Kong and China for the marks BONSO and MODUS in connection with certain electronic
apparatus.
We
rely on a combination of patent, trademark and trade secret laws, employee and third party non-disclosure agreements and other
intellectual property protection methods to protect our proprietary rights. There can be no assurance that third parties will
not assert infringement or other claims against us with respect to any existing or future products. We cannot assure you that
licenses would be available if any of our technology were successfully challenged by a third party, or if it became desirable
to use any third-party technology to enhance the Company's products. Litigation to protect our proprietary information or
to determine the validity of any third-party claims could result in a significant expense to us and divert the efforts of our
technical and management personnel, whether or not such litigation is determined in our favor.
While
we have no knowledge that we are infringing upon the proprietary rights of any third party, there can be no assurance that such
claims will not be asserted in the future with respect to existing or future products. Any such assertion by a third party could
require us to pay royalties, to participate in costly litigation and defend licensees in any such suit pursuant to indemnification
agreements or to refrain from selling an alleged infringing product or service.
Product
Research and Development
The
major responsibility of the product design, research and development personnel is to develop and produce designs to the satisfaction
of, and in accordance with, the specifications provided by the OEMs, OBMs and ODMs. We believe our engineering and product development
capabilities are important to the future success of our business. As an ODM, we take specifications that are provided to us by
the customer and design a product to meet those specifications. Some of our product design, research and development activities
are customer funded and are under agreements with specific customers for specific products. To reduce costs, we conduct our research
and development at our facilities in China. We principally employ Chinese engineers and technicians at costs that are substantially
lower than those that would be required in Hong Kong. At March 31, 2015, we employed 14 individuals in Hong Kong and China for
our engineering staff, who are at various times engaged in research and development.
35
Competition
The
manufacture and sale of electronic sensor-based and wireless products is highly competitive. Competition is primarily based upon
unit price, product quality, reliability, product features and management's reputation for integrity. Accordingly, reliance
is placed on research and development of new products, line extensions and technological, quality and other continuous product
improvement. There can be no assurance that we will enjoy the same degree of success in these efforts in the future. Research
and development expenses aggregated approximately $396,000, $366,000 and $228,000 during the fiscal years ended March 31, 2013,
2014 and 2015, respectively.
Seasonality
Generally,
the first calendar quarter of each year is typically the slowest sales period because our manufacturing facilities in China are
closed for two weeks for the Chinese New Year holidays to permit employees to travel to their homes in China. In addition, sales
during the first calendar quarter of scales products usually dip following the increase in sales during the Christmas season.
A greater number of our sales of scales products occur between the months of July and October for shipment in preparation for
the Christmas holiday. Throughout the remainder of the year, our products do not appear to be subject to significant seasonal
variation. However, past sales patterns may not be indicative of future performance.
Transportation
Typically,
we sell products either F.O.B. Hong Kong, Yantian (Shenzhen) or Nansha (Guangzhou), which means that our customers are responsible
for the transportation of finished products from Hong Kong, Yantian (Shenzhen) or Nansha (Guangzhou) to their final destination.
Transportation of components and finished products to and from the point of shipment is by truck. To date, we have not been materially
affected by any transportation problems. However, transportation difficulties affecting air cargo or shipping, such as an extended
closure of ports that materially disrupts the flow of our customers' products to their destination, mainly the United States
and Europe, could materially and adversely affect our sales and margins if, as a result, our customers delay or cancel orders
or seek concessions to offset expediting charges they incurred pending resolution of the problems causing the port closures.
Government
Regulation
We
are subject to comprehensive and changing foreign, federal, provincial, state and local environmental requirements, including
those governing discharges into the air and water, the handling and disposal of solid and hazardous waste and the remediation
of contamination associated with releases of hazardous substances. We believe that we are in compliance with current environmental
requirements. Nevertheless, we use hazardous substances in our operations and, as is the case with manufacturers in general, if
a release of hazardous substances occurs on or from our properties we may be held liable and may be required to pay the cost of
remediation. The amount of any resulting liability could be material.
36
Foreign
Operations
Our
products are manufactured at our factories located in China. While China has been granted permanent most favored nation trade
status in the United States through its entry into the World Trade Organization, controversies between the United States and China
may arise that threaten the status quo involving trade between the United States and China. These controversies could materially
and adversely affect our business by, among other things, causing our products in the United States to become more expensive,
resulting in a reduction in the demand for our products by customers in the United States.
Sovereignty
over Hong Kong reverted to China on July 1, 1997. The 1984 Sino-British Joint Declaration, the 1990 Basic Law of Hong Kong, the
1992 United States-Hong Kong Policy Act and other agreements provide some indication of the business climate we believe will continue
to exist in Hong Kong. Hong Kong remains a Special Administrative Region ("SAR") of China, with certain autonomies
from the Chinese government. Hong Kong is a full member of the World Trade Organization. It has separate customs territory from
China, with separate tariff rates and export control procedures. It has a separate intellectual property registration system.
The Hong Kong Dollar is legal tender in the SAR, freely convertible and not subject to foreign currency exchange controls by China.
The SAR government has sole responsibility for tax policies, though the Chinese government must approve the SAR's budgets.
Notwithstanding the provisions of these international agreements, we cannot be assured of the continued stability of political,
legal, economic or other conditions in Hong Kong. No treaty exists between Hong Kong and the United States providing for the reciprocal
enforcement of foreign judgments. Accordingly, Hong Kong courts might not enforce judgments predicated on the federal securities
laws of the United States, whether arising from actions brought in the United States or, if permitted, in Hong Kong.
37
Organizational
Structure
We
have two wholly-owned Hong Kong subsidiaries, Bonso Electronics Limited ("BEL") and Bonso Advanced Technology Limited
("BATL"). Both BEL and BATL were organized under the laws of Hong Kong and are responsible for the design, development,
manufacture and sale of our products.
BEL
has one active Hong Kong subsidiary, Bonso Investment Limited ("BIL"). BIL was organized under the laws of Hong Kong
and has been used to acquire and hold our investment properties in Hong Kong and China.
BEL
also has one active PRC subsidiary, Bonso Electronics (Shenzhen) Company, Limited ("BESCL"), which is organized under
the laws of the PRC and was used to manufacture our products until January 2014. BESCL leased its factory to a third party from
August 2013 to August 2019, and is receiving a monthly rental income of approximately $104,000 until August 2016, which will increase
to approximately $114,000 from August 2016 to August 2019. Effective with the transfer of manufacturing operations to Xinxing,
we ceased manufacturing in this subsidiary and its principal business today is leasing our former manufacturing facility to a
third party.
BATL
has three active PRC subsidiaries, Bonso Advanced Technology (Xinxing) Company, Limited ("BATXXCL"), which is organized
under the laws of the PRC and is used to acquire and hold our new manufacturing facility in Xinxing, Guangdong, China, Xinxing
An Bang Metal and Plastic Manufacturing Company Limited ("ANB"), in Xinxing, Guangdong, PRC, for hiring workers for
assembly of scales and pet electronics products, and Bonso Technology (Shenzhen) Company Limited ("BTL"), in Shenzhen,
PRC, to provide product design and distribution services for the Group.
38
We
also have a wholly-owned British Virgin Islands subsidiary, Modus Enterprise International Inc. ("Modus"), which owned
100% of Korona until Korona's liquidation during the fiscal year ended March 31, 2012 and which owns 100% of Bonso USA,
which has been dormant since 2009 and does not conduct any business activities. (See "History and Development of the Company,"
above.)
Property,
Plant and Equipment
British
Virgin Islands
Our
corporate administrative offices are located at Cragmuir Chambers, Road Town, Tortola, British Virgin Islands and corporate administrative
matters are conducted through our registered agent, HWR Services Limited, located at P.O. Box 71, Road Town, Tortola, British
Virgin Islands.
Hong
Kong
We
own a residential property in Hong Kong, which is located at Savanna Garden, House No. 27, Tai Po, New Territories, Hong Kong.
House No. 27 consists of approximately 2,475 square feet plus a 177 square foot terrace and a 2,308 square foot garden area. The
use of House No. 27 is provided as quarters to Mr. Anthony So, the Chairman and Chief Executive Officer of the Company.
China
Our
Shenzhen factory in China is located at Shenzhen in the DaYang Synthetical Development District, close to the border between Hong
Kong and China. This factory consists of one factory building, which contains approximately 186,000 square feet, two workers'
dormitories, containing approximately 103,000 square feet, a canteen and recreation center of approximately 26,000 square feet,
an office building, consisting of approximately 26,000 square feet, and two staff quarters for our supervisory employees, consisting
of approximately 34,000 square feet, for a total of approximately 375,000 square feet. The Group entered into a rental agreement
in June 2013 to rent out the Shenzhen factory to a third party from August 2013 to August 2019. We receive a monthly rental income
of approximately $104,000 until August 2016, which will increase to approximately $114,000 from August 2016 to August 2019.
39
We
intend to begin the process of seeking the necessary governmental approvals to permit us to redevelop the Shenzhen factory into
a high end commercial complex, containing retail space, office space and some residential space. If we are successful in obtaining
the necessary governmental approvals for the redevelopment, we believe that the rental income derived from leasing the redeveloped
property will be a significant contributing factor to our profit in the future.
We
also own one residential property in Shenzhen, which is located at Lakeview Mansion, B-20C, Hujinju Building No. 63, Xinan Road,
Boacheng Baoan Shenzhen, China. It consists of approximately 1,591 square feet and is rented to an unaffiliated third party for
an aggregate monthly rental of RMB 4,500, or approximately $731.
In
addition, we own two office units in Beijing, namely Units 12 and 13 on the third floor, Block A of Sunshine Plaza in Beijing,
China. Unit 12 consists of 1,102 square feet and Unit 13 consists of 1,860 square feet. One unit is rented to an unaffiliated
third party for an aggregate monthly rental of approximately RMB 11,424, or approximately $1,856, while the other unit is rented
to another unaffiliated third party for an aggregate monthly rental of approximately RMB 8,000 or approximately $1,299.
Our
Xinxing factory is located in Xinxing High-Tech Industrial Estate, Xinxing, Yunfu City, Guangdong, China. This factory land area
is 1,448,000 square feet, with one factory building consisting of 225,000 square feet, one warehouse consisting of 62,000 square
feet, three dormitories consisting of an aggregate of 85,000 square feet and an office building consisting of 49,000 square feet.
Leasehold improvements being made to the office building are expected to be completed by December 2015.
On July 10, 2015, the Company entered into an agreement with a third party to sell part of the Company's land use right
in Xinxing, PRC for approximately $866,000. The area of this piece of land is approximately 18% of the total land area of our
Xinxing manufacturing facility. The selling price is approximately 86% more than our initial purchase price, and the resulting
gain will be determined upon final measurement by the local Land Department and the taxation will be determined by the local tax
authorities. This piece of land includes part of the land use rights currently arranged as securities to a bank for the banking
facilities arrangement. The Company is working with the bank in order to release part of the land use right to the buyer.
40
Adequacy
of Facilities
We
believe our manufacturing complex will be adequate for our reasonably foreseeable needs.
I
tem
4A. Unresolved Staff Comments
Not Applicable to Bonso.
Not
Applicable to Bonso
Item
5. Operating and Financial Review and Prospects
The
following discussion and analysis should be read in conjunction with Item 3. – "Key Information – Selected Financial
Data" and the Consolidated Financial Statements and Notes to Consolidated Financial Statements included elsewhere in this
Annual Report.
Overview
During
the fiscal year ended March 31, 2015, the Company experienced decreased revenues. Our overall sales decreased due to our discontinuation
of manufacturing and sales of certain lower margin products.
We
derive our revenues principally from the sale of sensor-based scales manufactured in China, which represent 89% of total sales
for the fiscal year ended March 31, 2015. As mentioned in Item 3. – "Key Information – Risk Factors,"
we are dependent upon a limited number of major customers for a significant portion of our revenues. Our revenues and business
operation are subject to fluctuation if there is a loss of orders from any of our largest customers. Further, the pricing of our
scale products is becoming increasingly competitive, especially to our customers in the United States and Germany, who contributed
approximately 95% of our revenue during the fiscal year ended March 31, 2015.
Net
sales from continuing operations, income (loss) from operations and net (loss) / income were approximately $30,386,000, ($403,000)
and ($754,000), respectively, for the fiscal year ended March 31, 2013, $31,305,000, $295,000, and ($221,000), respectively, for
the fiscal year ended March 31, 2014 and $28,944,000, $462,000, and $1,110,000, respectively, for the fiscal year ended March
31, 2015.
41
Labor
costs per worker are increasing in China. In accordance with the new minimum wage set by the local authorities, we increased the
minimum wage for our labor in Shenzhen, PRC from RMB 1,320 (or approximately $206) per month beginning April 1, 2011, to RMB 1,500
(or approximately $238) per month beginning February 1, 2012, and then to RMB 1,600 (or approximately $254) per month beginning
March 1, 2013, and then to RMB 1,808 (or approximately $293) per month beginning February 1, 2014 in Shenzhen, PRC. The minimum
wage was RMB 1,010 (or approximately $164) per month in Xinxing, Guangdong, PRC beginning May 1, 2013 and is currently RMB 1,210
(or approximately $197). We believe that future increase in labor costs in China will have a significant effect on our total production
costs and results of operations. Our labor costs represented approximately 11.8% of our total production costs in the fiscal year
ended March 31, 2015, compared to 14.5% in the fiscal year ended March 31, 2014 and 15.8% in 2013. Total labor costs decreased
from approximately $4,151,000 in the fiscal year ended March 31, 2014, to approximately $2,715,000 in the fiscal year ended March
31, 2015. The decrease in overall labor costs was the result of the strategic decrease in the number of workers due to a decrease
in orders. There can be no assurance that labor costs will not increase in the future or that any additional increase in labor
costs will not have a material adverse effect upon our results of operations.
We
have continued to shift production and manufacturing of various parts and components to third party suppliers, including plastic
injection molded parts and metal parts. In some cases, we have entered into agreements with third parties in which they lease
our equipment from us, and then manufacture parts and components that we use in assembling our final products. Those third parties
provide the workers and supervisors, and the necessary raw materials. We lease our machinery or equipment, our dormitory facilities
for their workers and supervisory staff, and our meals or cafeteria services for the third party's workers and staff. There
are other third party contractors that utilize their own equipment and their own facilities in manufacturing specific components
or parts for us.
We
have not experienced significant difficulties in obtaining raw materials for our products, and management does not anticipate
any such difficulties in the foreseeable future. Prices of raw materials increased during the fiscal year ended March 31, 2011,
but did not vary significantly during the fiscal years ended March 31, 2012, 2013 and 2014. The price of some of the raw materials
utilized by the Company fluctuates directly with the price of oil, and the price of raw materials decreased slightly in the fiscal
year ended March 31, 2015, compared to that in the fiscal year ended March 31, 2014. There can be no assurance that raw material
costs will not fluctuate or that any additional increase in raw material costs will not have a material adverse effect upon our
results of operations.
In
seeking to return to profitability, we analyzed our product mix and concluded that we were most likely to return to profitability
if we eliminated the production and sale of lower margin products that require the employment of larger numbers of workers and
the commitment of substantial resources to carry or stock raw materials and components inventory. We advised our largest customer
for these low margin electronic scale products that without substantial price increases we would not be in a position to continue
manufacturing these products in the calendar year beginning January 1, 2015. That customer did not agree to the price increases
that we requested, and has shifted this business to alternative suppliers. We are optimistic that this will result in improved
profitability for the Group.
42
Operating
Results
The
following table sets forth selected income data as a percentage of net sales for the periods indicated:
Fiscal Year Ended March 31,
Statement of Operations Data
2013
2014
2015
%
%
%
Net sales
100.0
100.0
100.0
Cost of sales
(83.1
)
(91.5
)
(79.8
)
Gross profit
16.9
8.5
20.2
Rental income
0.1
2.2
5.0
Selling expenses
(0.9
)
(1.2
)
(2.8
)
Salaries and related costs
(8.6
)
(9.5
)
(10.9
)
Research and development expenses
(1.3
)
(1.2
)
(0.8
)
Administration and general expenses
(7.9
)
(9.5
)
(11.2
)
Other income
0.4
0.1
1.8
Gain on disposal of property, plant and equipment
0.0
11.5
0.3
(Loss) / income from operations
(1.3
)
0.9
1.6
Interest income
0.0
0.2
0.1
Interest expenses
(0.2
)
(0.4
)
(1.0
)
Foreign exchange loss
(0.9
)
(1.4
)
(0.5
)
(Loss) / income before income taxes
(2.4
)
(0.7
)
0.2
Income tax (expense) / credit
(0.1
)
(0.0
)
3.6
Net (loss) / income
(2.5
)
(0.7
)
3.8
Fiscal
year ended March 31, 2015 compared to fiscal year ended March 31, 2014
Net
Sales
. Our sales decreased approximately $2,361,000, or 7.5%, from approximately $31,305,000 for the fiscal year ended March
31, 2014 to approximately $28,944,000 for the fiscal year ended March 31, 2015. The decrease in sales was primarily due to our
strategic decision to give up orders of certain lower margin electronic scale products.
43
Gross
Profit
. Gross profit as a percentage of revenue increased to approximately 20.2% during the fiscal year ended March 31, 2015,
as compared to approximately 8.5% during the fiscal year ended March 31, 2014. The higher gross margin was primarily the result
of a higher percentage of sales being of higher margin products.
Rental
Income.
Rental income increased approximately $745,000 or 105.2%, from approximately $708,000 for the fiscal year ended March
31, 2014 to approximately $1,453,000 for the fiscal year ended March 31, 2015. The increase was primarily the result of a full
year of rental income generated from the Shenzhen factory during the fiscal year ended March 31, 2015, as compared to partial
rental income generated since August 1, 2013 from the Shenzhen factory during the fiscal year ended March 31, 2014.
Selling
Expenses
. Selling expenses increased by approximately $433,000, or 111.3%, from approximately $389,000 for the fiscal year
ended March 31, 2014 to approximately $822,000 for the fiscal year ended March 31, 2015. The increase was the result of air freight
costs incurred due to a delay in production of certain orders of lower margin electronic scale products.
Salaries
And Related Costs
. Salaries and related costs increased by approximately $183,000, or 6.1%, from approximately $2,983,000
for the fiscal year ended March 31, 2014 to approximately $3,166,000 for the fiscal year ended March 31, 2015. The increase in
salaries and related costs was primarily the result of an increase in employee insurance and pension expenses for the fiscal year
ended March 31, 2015.
Research
And Development
. Research and development expenses decreased approximately $138,000, or 37.7%, from approximately $366,000
for the fiscal year ended March 31, 2014 to approximately $228,000 for the fiscal year ended March 31, 2015. The decrease in research
and development was primarily the result of a reduction in engineers for lower margin electronic scale products. Research and
development expenses account for 0.8% of net revenue for the fiscal year ended March 31, 2015, and for 1.2% of net revenue for
the fiscal year ended March 31, 2014.
Administration
And General Expenses.
Administration and general expenses increased by approximately $281,000, or 9.5%,
from approximately $2,964,000 for the fiscal year ended March 31, 2014 to approximately $3,245,000 for the fiscal year ended
March 31, 2015. The increase was primarily attributable to an increase in depreciation and local tax payments for the fiscal
year ended March 31, 2015.
44
Other
Income.
Other income increased approximately $500,000 or 2,500.0%, from approximately $20,000 for the fiscal year
ended March 31, 2014 to approximately $520,000 for the fiscal year ended March 31, 2015. The increase was primarily the result
of an increase of $131,000 gain on valuation of forward contracts and an increase of $194,000 for the reduction of aged accounts
payable for the fiscal year ended March 31, 2015.
Gain
on Disposal of Property, Plant and Equipment
. Gain on disposal of property, plant and equipment decreased approximately $3,497,000,
or 97.3%, from $3,595,000 for the fiscal year ended March 31, 2014 to approximately $98,000 for the fiscal year ended March 31,
2015. The gain of $3,595,000 for the disposal of property, plant and equipment for the fiscal year ended March 31, 2014 was related
to the Shenzhen factory, and was recorded when we transferred all production processes to the Xinxing factory and leased out the
Shenzhen factory for rental income. However, no such large gain on disposal of property, plant and equipment was realized during
the fiscal year ended March 31, 2015.
Income
From Operations
. As a result of the factors described above, income from operations increased by 56.6% from a profit of approximately
$295,000 for the fiscal year ended March 31, 2014 to a profit of approximately $462,000 for the fiscal year ended March 31, 2015.
Interest
Income
. Interest income decreased to approximately $18,000 for the fiscal year ended March 31, 2015, as compared to approximately
$64,000 for the fiscal year ended March 31, 2014, due to lower interest rates on saving accounts and fixed deposit accounts. During
the fiscal year ended March 31, 2014, the Company earned 6% per annum, or approximately $62,000, from a fixed deposit in RMB with
the interest rate pegged to the appreciation rate of RMB against USD. During the fiscal year ended March 31, 2015, the Company
earned 0.25% per annum, or approximately $3,000, from a similar fixed deposit in RMB for which the interest rate was pegged to
the appreciation rate of RMB against USD.
Interest
Expense
. Interest expense increased approximately $137,000, or 100.7%, from approximately $136,000 for the fiscal year ended
March 31, 2014 to approximately $273,000 for the fiscal year ended March 31, 2015. This increase was primarily the result of an
increase in bank borrowings obtained in the PRC with higher interest rates.
Foreign
Exchange Loss.
Foreign exchange loss decreased approximately $310,000, or 69.8%, from approximately $444,000 for the fiscal
year ended March 31, 2014 to approximately $134,000 for the fiscal year ended March 31, 2015. This decrease was primarily the
result of decrease in magnitude of the appreciation of Chinese Yuan against the United States Dollars during the fiscal year ended
March 31, 2015.
45
Income
Tax (Expense) / Credit
. Income tax credit was approximately $1,037,000 during the fiscal year ended March 31, 2015, as compared
to $nil during the fiscal year ended March 31, 2014. The increase in income tax credit was the result of the reversal of over-provision
of the prior years' uncertain income tax liability. The tax review was concluded and confirmed with local tax authorities
during the fiscal year ended March 31, 2015.
Net
(Loss) / Income
. As a result of the factors described above, net income increased from a loss of approximately $221,000 for
the fiscal year ended March 31, 2014 to income of approximately $1,110,000 for the fiscal year ended March 31, 2015, an increase
in income of approximately $1,331,000, or 602.3%.
Foreign
Currency Translation Adjustments.
Foreign currency translation adjustments, net of tax, decreased from approximately $257,000
for the fiscal year ended March 31, 2014 to approximately $123,000 for the fiscal year ended March 31, 2015, a decrease of approximately
$134,000, or 52.1%. The decreased foreign currency translation adjustment, net of tax, was primarily the result of reduced fluctuation
of the Chinese Renminbi against the United States Dollar.
Comprehensive
(Loss) / Income.
As a result of the factors described above, comprehensive gain increased from an income of approximately
$36,000 for the fiscal year ended March 31, 2014 to an income of approximately $1,233,000 for the fiscal year ended March 31,
2015, an increase of approximately $1,197,000 or 3,325%.
Fiscal
year ended March 31, 2014 compared to fiscal year ended March 31, 2013
Net
Sales
. Our sales increased approximately $919,000, or 3.0%, from approximately $30,386,000 for the fiscal year ended March
31, 2013 to approximately $31,305,000 for the fiscal year ended March 31, 2014. The increase in sales was primarily due to an
increased demand for our electronic scales products.
Gross
Profit
. Gross profit as a percentage of revenue decreased to approximately 8.5% during the fiscal year ended March 31, 2014,
as compared to approximately 16.9% during the fiscal year ended March 31, 2013. The lower gross margin was primarily the result
of the increased labor costs due to termination of all direct labor in our Shenzhen factory during the transfer of production
processes to our Xinxing factory, and for an increase in subcontracting costs for subcontracting work to third parties during
our loss of production capacity during the transfer. In addition, we incurred approximately $307,000 more in carriage inward during
the fiscal year ended March 31, 2014 for the transfer of production processes to the Xinxing factory.
46
Rental
Income.
Rental income increased approximately $663,000 or 1,473.3%, from approximately $45,000 for the fiscal year ended March
31, 2013 to approximately $708,000 for the fiscal year ended March 31, 2014. The increase was primarily the result of the rental
income generated from leasing out the Shenzhen factory since August 1, 2013.
Selling
Expenses
. Selling expenses increased by approximately $121,000 from approximately $268,000 for the fiscal year ended March
31, 2013 to approximately $389,000 for the fiscal year ended March 31, 2014, or 45%. The increase was the result of increased
air shipments due to delay in delivery of our products, due to insufficient workers employed after we moved all production to
the Xinxing factory.
Salaries
And Related Costs
. Salaries and related costs increased by approximately $356,000, or 13.6%, from approximately $2,627,000
for the fiscal year ended March 31, 2013 to approximately $2,983,000 for the fiscal year ended March 31, 2014. The increase in
salaries and related costs was primarily the result of an increase in salary of staff in China in accordance with the increase
in minimum wage, and severance payment to staff as a result of termination of all staff in our Shenzhen factory during the transfer
of production processes to our Xinxing factory.
Research
And Development
. Research and development expenses decreased approximately $30,000, or 7.6%, from approximately $396,000 for
the fiscal year ended March 31, 2013 to approximately $366,000 for the fiscal year ended March 31, 2014. The decrease in research
and development was primarily the result of decreased headcount of engineers in accordance with decreased projects during the
fiscal year ended March 31, 2014. Research and development expenses account for 1.2% of net revenue for the fiscal year ended
March 31, 2014, and for 1.3% of net revenue for the fiscal year ended March 31, 2013.
Administration
And General Expenses.
Administration and general expenses increased by approximately $562,000, or 23.4%, from approximately
$2,402,000 for the fiscal year ended March 31, 2013 to approximately $2,964,000 for the fiscal year ended March 31,2014. The increase
is primarily attributable to an approximately $419,000 loss in fair value of forward contracts for the fiscal year ended March
31, 2014, compared to a $87,000 gain in fair value of forward contracts for the fiscal year ended March 31, 2013.
Other
Income.
Other income decreased approximately $100,000, or 83.3%, from approximately $120,000 for the fiscal year ended March
31, 2013 to approximately $20,000 for the fiscal year ended March 31, 2014. A gain of $87,000 for the valuation of forward contracts
was recorded during the fiscal year ended March 31, 2013. However, no such gain on valuation of forward contracts was realized
during the fiscal year ended March 31, 2014.
47
Gain
on Disposal of Property, Plant and Equipment
. A gain of $3,595,000 for the disposal of property, plant and equipment related
to the Shenzhen factory was recorded when we transferred all production process to the Xinxing factory and the Shenzhen factory
was leased out for rental income. There was $2,000 gain on disposal of property, plant and equipment during the fiscal year ended
March 31, 2013.
(Loss)
/ Income From Operations
. As a result of the factors described above, income from operations increased by 173.2% from a loss
of approximately $403,000 for the fiscal year ended March 31, 2013 to a profit of approximately $295,000 for the fiscal year ended
March 31, 2014.
Interest
Income
. Interest income increased to approximately $64,000 for the fiscal year ended March 31, 2014, as compared to approximately
$7,000 for the fiscal year ended March 31, 2013, due to a deposit placed in high interest yield investment during the fiscal year
ended March 31, 2014.
Interest
Expense
. Interest expense increased approximately $68,000, or 100.0%, from approximately $68,000 for the fiscal year ended
March 31, 2013 to approximately $136,000 for the fiscal year ended March 31, 2014. This increase was primarily the result of an
increase in utilization of banking facilities including short term bank loan and bank overdraft during the fiscal year ended March
31, 2014.
Foreign
Exchange Loss.
Foreign exchange loss increased approximately $183,000, or 70.1%, from approximately $261,000 for the fiscal
year ended March 31, 2013 to approximately $444,000 for the fiscal year ended March 31, 2014. This increase was primarily the
result of the fluctuation and appreciation of the Chinese Renminbi compared to the United States Dollar during the fiscal year
ended March 31, 2014.
Income
Tax Expense
. Income tax expense was $nil during the fiscal year ended March 31, 2014, as compared to $29,000 during the fiscal
year ended March 31, 2013.
Net
Loss
. As a result of the factors described above, net loss decreased from a loss of approximately $754,000 for the fiscal
year ended March 31, 2013 to a loss of approximately $221,000 for the fiscal year ended March 31, 2014, a decrease in loss of
approximately $533,000, or 70.7%.
48
Foreign
Currency Translation Adjustments.
Foreign currency translation adjustments, net of tax, increased from approximately $62,000
for the fiscal year ended March 31, 2013 to a gain of approximately $257,000 for the fiscal year ended March 31, 2014, a increase
of approximately $195,000, or 314.5%. The increased foreign currency translation adjustment, net of tax, was primarily the result
of increased fluctuation of the Chinese Renminbi against the United States Dollar.
Comprehensive
(Loss) / Income.
As a result of the factors described above, comprehensive gain increased from a loss of approximately $692,000
for the fiscal year ended March 31, 2013 to an income of approximately $36,000 for the fiscal year ended March 31, 2014, an increase
of approximately $728,000, or 105.2%.
Impact
of Inflation
We
believe that inflation had an impact on our business during the fiscal years ended March 31, 2012, 2013 and 2014. The minimum
wage in Shenzhen, PRC, increased from RMB 1,100 (or approximately $162) per month beginning July 1, 2010 to RMB 1,320 (or approximately
$206) per month beginning April 1, 2011, and was later increased to RMB 1,500 (or approximately $238) per month beginning February
1, 2012, RMB 1,600 (or approximately $254) per month beginning March 1, 2013 and then to RMB 1,808 (or approximately $293) per
month beginning February 1, 2014. We believe that the impact of inflation on our business was minimal during the fiscal year ended
March 31, 2015 due to the lower price of oil. However, the minimum wage in Xinxing, PRC was increased from RMB 1,010 per month
(or approximately $160) to RMB 1,210 per month (or approximately $197) as of May 1, 2015. As a result, we believe that inflation
will continue to increase our operating costs and cost of raw materials and have a significant impact upon us in the future. We
have generally been able to modify and improve our product designs so that we could either increase the prices of our products
or lower the production costs in order to keep pace with inflation. Oil prices have been volatile in recent years. If oil prices
increase, it will likely result in an increase in the cost of components to us, as well as an increase in our operating expenses,
which will have a material adverse effect upon our business and results of operations. Further, the increase in labor costs and
operating costs in the PRC has had a material impact on our profitability.
49
Taxation
The
companies comprising the Group are subject to tax on an entity basis on income arising in, or derived from, Hong Kong and the
PRC. The current rate of taxation of the subsidiary operating in Hong Kong is 16.5%. The Group is not subject to income taxes
in the British Virgin Islands.
The
tax rates for our subsidiary in the PRC were 24% in 2011 and 25% in 2012 and beyond. There is no tax payable in Hong Kong on offshore
profit or on dividends paid to Bonso Electronics Limited by its subsidiaries or to us by Bonso Electronics Limited. Therefore,
our overall effective tax rate may be lower than that of most United States corporations; however, this advantage could be materially
and adversely affected by changes in the tax laws of the British Virgin Islands, Hong Kong or China.
Efforts
by the Chinese government to increase tax revenues could result in decisions or interpretations of the tax laws by the Chinese
tax authorities that are unfavorable to us and which increase our future tax liabilities or deny our expected refunds. Changes
in Chinese tax laws or their interpretation or application may subject us to additional Chinese taxation in the future.
No
reciprocal tax treaty regarding withholding taxes exists between the United States and the British Virgin Islands. Under current
British Virgin Islands law, dividends, interest or royalties paid by us to individuals are not subject to tax as long as the recipient
is not a resident of the British Virgin Islands. If we were to pay a dividend, we would not be liable to withhold any tax, but
shareholders would receive gross dividends, irrespective of their residential or national status.
During
the fiscal years ended March 31, 2012, 2013 and 2014, certain of our subsidiaries were, and continue to be, subject to inquiries
from the local tax authorities. Upon the adoption of ASC 740 "Income Taxes", the Company recorded a provision of approximately
$2,595,000 in relation to uncertain tax positions as of April 1, 2007. During the fiscal year ended March 31, 2015, the tax review
case was closed and confirmed with the local tax authorities and the final tax and interest payable were approximately $1,545,000.
After offsetting with the tax reserve certificates purchased for approximately $1,710,000, the Company obtained a refund of approximately
$165,000.
Contractual
arrangements we have entered into among us and our subsidiaries in different locations may be subject to scrutiny by respective
tax authorities, and a finding against the Company and its subsidiaries may result in additional tax liabilities that could substantially
reduce our consolidated net income. We could face material and adverse tax consequences if respective tax authorities determine
that the contractual arrangements among our subsidiaries and Bonso do not represent an arm's length price and adjust Bonso's
or its subsidiaries' income. Our consolidated net income may be materially and adversely affected if our affiliated entities'
tax liabilities increase.
50
Dividends,
if any, paid to any United States resident or citizen shareholder are treated as dividend income for United States federal income
tax purposes. Such dividends are not eligible for the 70% dividends-received deduction allowed to United States corporations on
dividends from a domestic corporation under Section 243 of the United States Internal Revenue Code of 1986, as amended (the "Internal
Revenue Code"). Various Internal Revenue Code provisions impose special taxes in certain circumstances on non-United States
corporations and their shareholders. You are urged to consult your tax advisor with regard to such possibilities and your own
tax situation.
In
addition to United States federal income taxation, shareholders may be subject to state and local taxes upon their receipt of
dividends.
Foreign
Currency Exchange Rates
We
sell most of our products to international customers. Our principal export markets are North America (mainly the United States),
Europe (mainly Germany) and Asia. Other markets are other European countries (such as the United Kingdom), Australia and Africa.
Sales to international customers are made directly by us to our customers. We sell all of our products in United States Dollars
and pay for our material components principally in United States Dollars and Hong Kong Dollars. A very small portion of the components
used are paid for in Japanese Yen. Most factory expenses incurred are paid in Chinese Renminbi. Because the Hong Kong Dollar is
pegged to the United States Dollar, in the past our only material foreign exchange risk arose from potential fluctuations in the
Chinese Renminbi and a devaluation in United States Dollars. For the reasons discussed in the paragraphs below, management believes
that it may be possible that there will be some fluctuation in the coming year. During the fiscal year ended March 31, 2015, we
experienced a foreign currency exchange loss of approximately $134,000.
A
summary of our debts from our banking facilities utilized as at March 31, 2014 and 2015 which was subject to foreign currency
risk is as follows:
March 31, 2014
March 31, 2015
$ in thousands
$ in thousands
Hong Kong dollars and Chinese Yuan
5,477
5,206
The
amount above is due within one year.
51
Fluctuations
in the value of the Hong Kong Dollar have not been significant since October 17, 1983, when the Hong Kong government tied the
value of the Hong Kong Dollar to that of the United States Dollar. However, there can be no assurance that the value of the Hong
Kong Dollar will continue to be tied to that of the United States Dollar. China adopted a floating currency system on January
1, 1994, unifying the market and official rates of foreign exchange. China approved current account convertibility of the Chinese
Renminbi on July 1, 1996, followed by formal acceptance of the International Monetary Fund's Articles of Agreement on December
1, 1996. These regulations eliminated the requirement for prior government approval to buy foreign exchange for ordinary trade
transactions, though approval is still required to repatriate equity or debt, including interest thereon. From 1994 until July
2005, the Chinese Renminbi had remained stable against the U.S. Dollar at approximately 8.28 to 1.00 U.S. Dollar. On July 21,
2005, the Chinese currency regime was altered to link the RMB to a "basket of currencies," which includes the United
States Dollar, Euro, Japanese Yen and Korean Won. Under the rules, the RMB was allowed to move 0.3% on a daily basis against the
United States Dollar. The People's Bank of China, on May 21 2007, widened the RMB trading band from 0.3% daily movement against
the United States Dollar to 0.5%. On June 20, 2010, the PBOC announced that the PRC government would further reform the RMB
exchange rate regime and increase the flexibility of the exchange rate, resulting in RMB appreciation against USD from 2010 to
2015, though there have been periods when the U.S. dollar has appreciated against the Renminbi as well. It is difficult to predict
how market forces or PRC or U.S. Government policy may impact the exchange rate between the RMB and the U.S. Dollar in the future.
As of July 15, 2015, the RMB was valued at 6.1089 per U.S. Dollar.
To
manage our exposure to foreign currency and translation risks, we may purchase currency exchange forward contracts, currency options
or other derivative instruments, provided such instruments may be obtained at suitable prices.
Liquidity
and Capital Resources
We
have financed our growth and cash needs to date primarily from internally generated funds and bank debt. We do not use off-balance
sheet financing arrangements, such as securitization of receivables or obtaining access to assets through special purpose entities,
as sources of liquidity. Our primary uses of cash have been to fund expansions and upgrades of our manufacturing facilities.
52
Operating
activities generated approximately $2,647,000 of net cash for the fiscal year ended March 31, 2015, as compared to $245,000 of
net cash for the fiscal year ended March 31, 2014. This increase in the amount of cash generated by operating activities was primarily
attributable to an increase in net income and reduction of inventory and trade receivables for the fiscal year ended March 31,
2015.
As
of March 31, 2015, we had approximately $3,027,000 in cash and cash equivalents and fixed deposits maturing over three months, as compared to $1,165,000 in cash and cash equivalents and fixed deposits maturing over three months as of March 31,
2014. Working capital at March 31, 2015 was approximately negative $4,391,000, as compared to negative $3,769,000 at March
31, 2014. The decrease in working capital was the result of increased bank loans utilized for the fiscal year ended March
31, 2015. We believe there are no material restrictions (including foreign exchange controls) on the ability of our
subsidiaries to transfer funds to us in the form of cash dividends, loans, advances or product/material purchases. We believe
our working capital is sufficient for our present requirements.
As
of March 31, 2015, we had approximately $1,306,000 in net trade receivables, as compared to $2,480,000 as of March 31, 2014. This
decrease of $1,174,000 was primarily attributable to the reduction in revenue and the decrease of shipments made towards the end
of the fiscal year ended March 31, 2015 as compared to the end of the fiscal year ended March 31, 2014.
As
of March 31, 2015, we had approximately $3,121,000 in inventories, as compared to $7,545,000 as of March 31, 2014. This decrease
of $4,424,000 was primarily attributable to the reduction in stock levels required for the manufacturing of our products.
As
of March 31, 2015, we had a total of approximately $6,621,000 in notes and accounts payable, as compared to $12,940,000 as of
March 31, 2014. The decrease of $6,319,000 was primarily attributable to an increase in our repayment of accounts payable to suppliers.
As
of March 31, 2015, we had in place general banking facilities with two financial institutions with amounts available aggregating
approximately $9,438,000 (2014: $10,698,000). Such facilities include the ability to obtain overdrafts, letters of credit, short-term
notes payable, factoring, short-term loans, long-term loans and financial instruments including forward contracts. As of March
31, 2015, we had utilized approximately $5,206,000 from these general banking facilities. Interest on this indebtedness fluctuates
with the prime rate and the Hong Kong Interbank Offer Rate as set by the Hong Kong Bankers Association, and the People's
Bank of China's loan benchmark interest rate. The bank credit facilities are collateralized by our bank guarantee and an
investment property of the Company. Our bank credit facilities are due for renewal annually. We anticipate that the banking facilities
will be renewed on substantially the same terms and our utilization in the next year will remain at a similar level as that in
the current year. During the fiscal years ended March 31, 2014 and 2015, we paid a total of approximately $136,000 and $273,000,
respectively, in interest on indebtedness for continuing operations.
53
Our
current ratio decreased from 0.80 as of March 31, 2014 to 0.67 as of March 31, 2015. Our quick ratio increased from 0.39 as of
March 31, 2014 to 0.44 as of March 31, 2015.
The
minimum wage was increased to RMB 1,320 (or approximately $206) beginning April 1, 2011, and was later increased to RMB 1,500
(or approximately $238) per month beginning February 1, 2012, and to RMB 1,600 (or approximately $254) per month beginning March
1, 2013, and then to RMB 1,808 (or approximately $293) per month beginning February 1, 2014 in Shenzhen, PRC. The minimum wage
was RMB 1,010 (or approximately $164) per month beginning May 1, 2013 in Xinxing, Guangdong, PRC, and was later increased to RMB
1,210 (or approximately $197) beginning May 1, 2015. Our entire manufacturing operation was moved to Xinxing during the fiscal
year ended March 31, 2014, and the overall labor costs have been reduced with the operation in Xinxing.
During
the fiscal year ending March 31, 2016, we expect we will need to expend approximately $301,000 on leasehold improvements to the
manufacturing facility in Xinxing, China.
We
believe that our cash flows from operations, our current cash balance and funds available under our working capital and credit
facilities will be sufficient to meet our working capital needs and planned capital expenditures for at least the next 12 to 24
months. However, a decrease in the demand for our products or increase in our costs of goods sold or expenses may affect our internally
generated funds, and we would further look to our banking facilities to meet our working capital demands.
Commitments
The
following table sets forth information with respect to our commitments as of March 31, 2015:
Payments due by Period
Total
Within 1 year
2 to 3 years
4 to 5 years
More than 5 years
$ in thousands
$ in thousands
$ in thousands
$ in thousands
$ in thousands
Notes
    payable and bank overdrafts and loans
(1) (2)
5,357
3,994
1,363
—
—
Operating leases
368
119
229
20
—
Capital leases
(2)
72
25
45
2
—
Construction in Xinxing
301
301
—
—
—
Income tax liabilities
7
7
—
—
—
Total
6,105
4,446
1,637
22
—
(1)
Represents amounts due under our banking facilities agreements, without considering the 		repayment on demand clause.
(2)
Includes interest payment.
For
a discussion of interest rates on our notes payable and bank loans, see Item 11. – "Qualitative and Quantitative
Disclosures About Market Risk," below.
54
Critical
Accounting Policies
The
methods, estimates and judgments we use in applying our most critical accounting policies have a significant impact on the results
we report in our financial statements. The SEC has defined the most critical accounting policies as the ones that are most important
to the portrayal of our financial condition and results and require us to make our most difficult and subjective judgments, often
as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, our most critical
policies include valuation of inventories, revenue recognition, impairment of long-lived assets, allowance for trade receivables
and income and deferred income taxes.
Below,
we discuss these policies further, as well as the estimates and judgments involved. We believe that our other policies either
do not generally require us to make estimates and judgments that are as difficult or as subjective, or it is less likely that
they would have a material impact on our reported results of operations for a given period. For a discussion of all our significant
accounting policies, see footnote 1 to the Consolidated Financial Statements included elsewhere in this Annual Report.
Valuation
of Inventories
Inventories
are stated at the lower of cost or net realizable value with cost determined on a first-in, first-out basis. Net realizable value
is the price at which inventories can be sold in the normal course of business after allowing for the costs of completion and
disposal. The Company continuously reviews slow-moving and obsolete inventory and assesses any inventory obsolescence based on
inventory levels, material composition and expected usage as of that date.
Revenue
Recognition
No
revenue is recognized unless there is persuasive evidence of an arrangement, the price to the buyer is fixed or determinable,
delivery has occurred and collectability of the sales price is reasonably assured. Revenue is recognized when title and risk of
loss transfers to the customer, which is generally when the product is leaving the port of Hong Kong, Shenzhen or Guangzhou as
designated by our customers. Shipping costs billed to our customers are included within revenue. Associated costs are classified
in cost of sales.
55
The
Company provides to certain customers an additional one to two percent of certain products ordered in lieu of a warranty, which
are recognized as cost of sales when these products are shipped to customers from our facilities. In addition, certain products
sold by the Company are subject to a limited product quality warranty. The Company accrues for estimated incurred but unidentified
quality issues based upon historical activity and known quality issues if a loss is probable and can be reasonably estimated.
The standard limited warranty period is one to three years. Quality returns, refunds, rebates and discounts are recorded net of
sales if they are within the warranty period. All sales are based upon firm orders with fixed terms and conditions, which generally
cannot be modified. Historically, we have not experienced material differences between our estimated amounts of quality returns,
refunds, rebates and discounts and the actual results.
Impairment
of Long-Lived Assets and Acquired Intangible Assets
Long-lived
assets held and used by the Group and acquired intangible assets are reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount of such assets may not be recoverable. The Group evaluates recoverability of assets to be held
and used by comparing the carrying amount of an asset to future net undiscounted cash flows to be generated by the asset. If such
assets are considered to be impaired, the impairment loss is measured by the amount by which the carrying amount of the assets
exceeds the fair value of the assets calculated using a discounted future cash flows analysis.
Allowance
for Trade Receivables
Allowance
is made against trade receivables to the extent that collection is considered to be doubtful. This allowance is primarily determined
from our monthly aging analysis. It also requires judgment regarding the collectability of certain receivables, as certain receivables
may be identified as collectible that are subsequently uncollectible and which could result in a subsequent write-off of the related
receivable to the statement of operations. Most of the Company's trade receivables are generally unsecured, except for two
customers with receivables covered by credit insurance. To determine the necessity of a provision, the Company analyzes the age
of the receivables and the customer's ability to pay based on past payment history, financial statements and various information
of the customer. Any change in the collectability of accounts receivable that were not previously provided for could significantly
change the calculation of such provision and the results of our operations.
56
Income
and Deferred Income Taxes
The
Company complies with ASC 740 which prescribes a recognition threshold and measurement attributes for the financial statement
recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on
derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Only tax positions
that meet the more-likely-than-not recognition threshold at the effective date may be recognized or continue to be recognized
upon adoption of ASC 740. The Company's accounting policy is to treat interest and penalties as a component of income taxes.
Amounts
in the consolidated financial statements related to income taxes are calculated using the principles of ASC 740 and ASU 2013-11
"Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit
Carryforward Exists." ASC 740 requires recognition of deferred tax assets and liabilities for the expected future tax consequences
of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities
are determined based on the temporary differences between the financial reporting basis and the tax basis of assets and liabilities
using enacted tax rates in effect for the year in which the differences are expected to reverse. Future tax benefits, such as
net operating loss carry forwards, are recognized as deferred tax assets. Recognized deferred tax assets are reduced by a valuation
allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax
asset will not be realized.
Trend
Information
Although
we are optimistic about our future in the manufacture and sale of sensor-based scales products, we are dependent upon a limited
number of customers for a significant portion of our revenues, and the loss of any of these customers could have a material adverse
effect upon us and our results of operations. As of March 31, 2015, our backlog of manufacturing orders was $4,581,000 as compared
to $6,707,000 as of March 31, 2014. We expect that the demand for our products will decrease in the fiscal year ending March 31,
2016, compared with that in the fiscal year ended March 31, 2015 as a result of our reduction of lower margin electronic scale
products.
Off-Balance
Sheet Arrangements
We
do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our
financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures
or capital resources that are material to investors.
57
Recent
Accounting Pronouncements
The
new accounting pronouncements in the United States that may be relevant to the Group are as follows:
In
April 2014, the FASB issued ASU 2014-08, "Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment
(Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity" ("ASU 2014-08").
ASU 2014-08 amends the definition of a discontinued operation and requires entities to provide additional disclosures for both
discontinued operations and disposal transactions that do not meet the discontinued operations criteria. It is effective for annual
periods beginning on or after December 15, 2014. We do not expect the adoption of this guidance to have a material effect on our
consolidated financial statements.
In May 2014,
the FASB issued ASU 2014-09. "Revenue from Contracts with Customers' ("ASU 2014-09"). The objective of
this Update is to remove inconsistencies and weaknesses in revenue requirements, and to simplify the preparation of financial
statements by reducing the number requirements to which an entity must refer. The new standard supersedes virtually all present
U.S. GAAP guidance on revenue recognition and requires the use of more estimates and judgments than the present standards, as
well as additional disclosures. The FASB has voted to approve a one year deferral of the effective date from January 1, 2017 to
January 1, 2018, while allowing for early adoption as of January 1, 2017. The Company is currently evaluating the impact this
Update will have on its consolidated financial statements.
In
June 2014, the FASB issued ASU 2014-12, "Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments
When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period" ("ASU
2014-12"). The amendments in ASU 2014-12 require that a performance target that affects vesting and that could be achieved
after the requisite service period be treated as a performance condition. The amendments in this ASU are effective for annual
reporting periods beginning after December 15, 2015, including interim periods within that reporting period, with early application
permitted. Companies may use either a prospective or a retrospective approach to adopt this ASU and the Company is currently evaluating
which transition approach to use. The Company is evaluating the new pronouncement to determine the impact it may have on its consolidated
financial statements.
58
In
January 2015, the FASB issued ASU 2015-01, "Income Statement - Extraordinary and Unusual Items (Subtopic 225-20): Simplifying
Income Statement Presentation by Eliminating the Concept of Extraordinary Items" ("ASU 2015-01"). The amendments
in ASU 2015-01 eliminate from U.S. GAAP the concept of extraordinary items. The amendments in this ASU are effective for annual
reporting periods beginning after December 15, 2015, including interim periods within that reporting period, with early application
permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. Companies may use either a
prospective or a retrospective approach to adopt this ASU and the Company is currently evaluating which transition approach to
use. The adoption of ASU 2015-01 is not expected to have a material impact on the Company's consolidated financial statements.
In
February 2015, the FASB issued ASU 2015-02, "Consolidation (Topic 810): Amendments to the Consolidation Analysis"
("ASU 2015-02"). The amendments in ASU 2015-02 change the analysis that a reporting entity must perform to determine
whether it should consolidate certain types of legal entities. The amendments in this ASU are effective for public business entities
for fiscal years beginning after December 15, 2015, and for interim periods within those fiscal years. Early adoption is permitted,
including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should
be reflected as of the beginning of the fiscal year that includes that interim period. A reporting entity may apply the amendments
in this ASU using a modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning
of the fiscal year of adoption. A reporting entity also may apply the amendments retrospectively. The adoption of ASU 2015-02
is not expected to have a material impact on the Company's consolidated financial statements.
In
April 2015, the FASB issued ASU 2015-03, "Simplifying the Presentation of Debt Issuance Costs," ("ASU 2015-03")
which changes the presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such
costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the
costs will continue to be reported as interest expense. The guidance is effective for fiscal years beginning after December 15,
2015, with early adoption permitted. The adoption of ASU 2015-03 is not expected to have a material impact on the Company's
consolidated financial statements or disclosures.
In
April 2015, the FASB issued ASU 2015-05, "Customer's Accounting for Fees Paid in a Cloud Computing Arrangement"
("ASU 2015-05") (an update to Subtopic 350-40, Intangibles - Goodwill and Other - Internal-Use Software), which provides
guidance on accounting for cloud computing fees. If a cloud computing arrangement includes a software license, then the customer
should account for the license element of the arrangement consistent with the acquisition of other software licenses. If a cloud
computing arrangement does not include a software license, the arrangement should be accounted for as a service contract. This
ASU is effective for arrangements entered into, or materially modified, in interim and annual periods beginning after December
15, 2015. Retrospective application is permitted but not required. The adoption of ASU 2015-05 is not expected to have a material
impact on the Company's consolidated financial statements or disclosures.
59
In
May 2015, the FASB issued ASU 2015-07, "Fair Value Measurement: Disclosures for Investments in Certain Entities That Calculate
Net Asset Value per Share (or Its Equivalent)" ("ASU 2015-07"), which removes the requirement to categorize
within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical
expedient. The ASU also removes the requirement to make certain disclosures for all investments that are eligible to be measured
at fair value using the net asset value per share practical expedient. Rather, those disclosures are limited to investments for
which the entity has elected to measure the fair value using that practical expedient. This ASU is effective for arrangements
entered into, or materially modified, in interim and annual periods beginning after December 15, 2015. Retrospective application
is permitted but not required. The Company is currently evaluating the impact of this ASU on the consolidated financial statements.
We
believe there is no additional new accounting guidance adopted, but not yet effective that is relevant to the readers of our financial
statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact
on our financial reporting.
Item
6. Directors, Senior Management and Employees
Directors
and Senior Management
Our
Board of Directors and executive officers are listed below:
Name
Age
Position with Bonso
Anthony So
72
Chairman of the Board, Chief Executive Officer and Director
Andrew So
29
Deputy Chairman of the Board, President, Chief
    Operating     Officer and Director
Albert So
37
Director, Chief Financial Officer, Treasurer,
    Financial Controller and Secretary
Kim Wah Chung
57
Director of Engineering and Research and Development
Woo-Ping Fok
66
Director
Henry F. Schlueter
64
Director
and Assistant Secretary
60
ANTHONY
SO is the founder of Bonso. He has been our Chairman of the Board of Directors since July 1988. He was appointed as the Chief
Executive Officer and President on November 16, 2006, and served in those capacities until March 20, 2015 when Andrew So was appointed
President. Mr. So received his BSE degree in civil engineering from National Taiwan University in 1967 and a Master degree in
Business Administration ("MBA") from the Hong Kong campus of the University of Hull, Hull, England in 1994. Mr. So
has been Chairman of the Hong Kong GO Association since 1986 and also served as Chairman of the Alumni Association of National
Taiwan University for the 1993-1994 academic years. Mr. So has served as a trustee of the Chinese University of Hong Kong, New
Asia College since 1994.
ANDREW
SO joined the Company in August 2009 and has been a director since February 25, 2012.  Mr. So currently holds the position
of Chief Operating Officer and oversees the Company's daily operations, and has also held the positions of Deputy Chairman
of the Board and President since March 20, 2015.   Mr. So graduated with distinctions in 2008 from the University of
Toronto, Canada, with a Bachelor of Commerce degree (BComm). From 2008 to 2009, prior to his employment with the Company, Mr.
So worked as a Derivatives Analyst at State Street Trust Company Canada, Toronto, Canada. Mr. So graduated from the MBA Program
of Hong Kong University of Science and Technology in the Fall of 2014.
ALBERT
SO was appointed as the Chief Financial Officer and Secretary of the Company on March 27, 2009. He was appointed Treasurer and
Financial Controller of the Company on March 20, 2015. Mr. So was previously employed as the Financial Controller of the Company
in January 2008 and as a management trainee of the Company in November 2004.  Mr. So has been a director since March 1, 2013.
Prior to his employment as a management trainee of the Company, Mr. So was a student.  Mr. So is a Certified Management Accountant
and Financial Risk Manager, and received a Master degree in Business Administration from Heriot-Watt University, Edinburgh, United
Kingdom, and a Bachelor degree in Mathematics from Simon Fraser University in Burnaby, British Columbia, Canada.
KIM
WAH CHUNG has been a director since September 21, 1994. Mr. Chung has been employed by us since 1981 and currently holds the position
of Director of Engineering and Research and Development. Mr. Chung is responsible for all research projects and product development.
Mr. Chung's entire engineering career has been spent with Bonso, and he has been involved in all of our major product developments.
Mr. Chung graduated with honors in 1981 from the Chinese University of Hong Kong with a Bachelor of Science degree in electronics.
WOO-PING
FOK was elected to our Board of Directors on September 21, 1994. Mr. Fok has practiced law in Hong Kong since 1991 and is a Consultant
with Messrs. C.K. Mok & Co. Mr. Fok's major areas of practice include conveyancing and real property law, corporations
and business law, commercial transactions and international trade with a special emphasis in China trade matters. Mr. Fok was
admitted to the Canadian Bar as a Barrister & Solicitor in December 1987 and was a partner in the law firm of Woo & Fok,
a Canadian law firm with its head office in Edmonton, Alberta, Canada. In 1991, Mr. Fok was qualified to practice as a Solicitor
of England & Wales, a Solicitor of Hong Kong and a Barrister & Solicitor of Australian Capital Territory.
61
HENRY
F. SCHLUETER has been a director since October 2001 and has been our Assistant Secretary since October 6, 1988. Since 1992, Mr.
Schlueter has been the Managing Director of Schlueter & Associates, P.C., a law firm, practicing in the areas of securities,
mergers and acquisitions, finance and corporate law. Mr. Schlueter has served as our United States corporate and securities counsel
since 1988. From 1989 to 1991, prior to establishing Schlueter & Associates, P.C., Mr. Schlueter was a partner in the Denver,
Colorado office of Kutak Rock (formerly Kutak, Rock & Campbell), and from 1984 to 1989, he was a partner in the Denver office
of Nelson & Harding. Mr. Schlueter is a member of the American Institute of Certified Public Accountants, the Colorado and
Denver Bar Associations and the Wyoming State Bar.
Anthony
So, the Company's Chief Executive Officer and Chairman of the Board of Directors is the father of Andrew So, the Company's
President and Chief Operating Officer, and Albert So, the Company's Chief Financial Officer, Treasurer and Secretary.
No
arrangement or understanding exists between any such director or officer and any other persons pursuant to which any director
or executive officer was elected as a director or executive officer. Our directors are elected annually and serve until their
successors take office or until their death, resignation or removal. The executive officers serve at the pleasure of the Board
of Directors.
62
Compensation
The
aggregate amount of compensation paid by us and our subsidiaries during the year ended March 31, 2015 to all directors, former
directors and officers as a group for services in all capacities was $1,305,000. Total compensation for the benefit of Anthony
So was $857,000, for the benefit of Kim Wah Chung was $160,000, for the benefit of Andrew So was $124,000, for the benefit of
Albert So was $109,000 and for the benefit of Henry F. Schlueter was an aggregate of $55,000. The $55,000 listed as having been
paid for the benefit of Mr. Schlueter was paid to his law firm, Schlueter & Associates, P.C., for legal services rendered.
The amount for the year ended March 31, 2015, included unpaid vacation payments of $9,000 and $57,000 for Kim Wah Chung and Anthony
So, respectively.
We
did not set aside or accrue any amounts to provide pension, retirement or similar benefits for directors and officers for the
fiscal year ended March 31, 2015, other than contributions to our Provident Fund Plan, which aggregated $17,000 for officers and
directors.
Employment
Agreements
We
have employment agreements with Anthony So and Kim Wah Chung. Mr. So's employment agreement provides for a maximum yearly
salary of approximately $800,000 per year plus bonus, and Mr. Chung's employment agreement provides for a maximum yearly
salary of approximately $200,000 per year plus bonus, as stated in their respective employment agreements. The initial term of
the employment agreements expired on March 31, 2013 ("Initial Term"); however, the employment agreements have been
renewed under a provision in the agreements that provides for automatic renewal for successive one year periods, unless at least
90 days prior to the expiration of the Initial Term or any renewal term, either party gives written notice to the other party
specifically electing to terminate the agreement. One of the properties of the Group in Hong Kong is also provided to Mr. So as
part of his compensation. Mr. So's employment agreement contains a provision under which the Company will	 be obligated
to pay Mr. So all compensation for the remainder of his employment agreement and five times his annual salary and bonus compensation
if a change of control, as defined in his employment agreement, occurs. Both employment agreements with Anthony So and Kim Wah
Chung were renewed automatically, and the respective employment agreements will expire on March 31, 2016, unless automatically
renewed.
63
Options
of Directors and Senior Management
The
following table provides information concerning options owned by the directors and senior management at July 15, 2015.
Name
Number
                                         of Common
Shares
                                         Subject to
Stock
                                         Options
Exercise
                                         Price
Per
                                         Share
Expiration Date
Anthony So
150,000
$
1.50
March 31, 2020
150,000
$
1.50
March 31, 2025
Andrew So
125,000
$
1.50
March 31, 2020
125,000
$
1.50
March 31, 2025
Albert So
60,000
$
1.50
March 31, 2020
60,000
$
1.50
March 31, 2025
Kim Wah Chung
40,000
$
1.50
March 31, 2020
40,000
$
1.50
March 31, 2025
Woo-Ping Fok
10,000
$
4.50
December 4, 2015
25,000
$
1.50
March 31, 2020
25,000
$
1.50
March 31, 2025
Henry F. Schlueter
10,000
$
4.50
December 4, 2015
25,000
$
1.50
March 31, 2020
25,000
$
1.50
March 31, 2025
Directors
Except
as mentioned above, our directors do not receive any additional monetary compensation for serving in their capacities. All directors
are reimbursed for all reasonable expenses incurred in connection with their services as a director.
64
Employee
retirement benefits
(a)
With
                                         effect from January 1, 1988, BEL, a wholly-owned foreign subsidiary of the Company in
                                         Hong Kong, implemented a defined contribution plan (the "Plan") with a major
                                         international assurance company to provide life insurance and retirement benefits for
                                         its employees. All permanent full time employees who joined BEL before December 2000,
                                         excluding factory workers, are eligible to join the provident fund plan. Eligible employees
                                         of the Plan are required to contribute 5% of their monthly salary, while BEL is required
                                         to contribute from 5% to 10% based on the eligible employee's salary, depending
                                         on the number of years of the eligible employee's service.
The
Mandatory Provident Fund (the "MPF") was introduced by the Hong Kong Government and commenced in December 2000. BEL
joined the MPF by implementing a plan with a major international assurance company. All permanent Hong Kong full time employees
who joined BEL on or after December 2000, excluding factory workers, are eligible to join the MPF. Eligible employees' and
the employer's contributions to the MPF are both at 5% of the eligible employee's monthly salary and are subject to
a maximum mandatory contribution of HK$1,000 (US$128) monthly. The maximum mandatory contribution was increased to HK$1,250 (US$160)
monthly starting from June 1, 2012. The maximum mandatory contribution was increased to HK$1,500 (US$192) per month starting from
June 1, 2014.
Pursuant
to the relevant PRC regulations, the Group is required to make contributions for each employee, at rates based upon the employee's
standard salary base as determined by the local Social Security Bureau, to a defined contribution retirement scheme organized
by the local Social Security Bureau in respect of the retirement benefits for the Group's employees in the PRC.
(b)
The
                                         contributions to each of the above schemes are recognized as employee benefit expense
                                         when they are due and are charged to the consolidated statement of income (loss). The
                                         Group's total contributions to the above schemes for the years ended March 31,
                                         2013, 2014 and 2015 amounted to approximately $225,000, $758,000 and $693,000, respectively.
                                         The Group has no other obligation to make payments in respect of retirement benefits
                                         of the employees.
Board
Practices
All
directors hold office until our next annual meeting of shareholders or until their respective successors are duly elected and
qualified or their positions are earlier vacated by resignation or otherwise. All executive officers are appointed by the Board
and serve at the pleasure of the Board. There are no director service contracts providing for benefits upon termination of employment
or directorship.
65
NASDAQ
Exemptions and Home Country Practices
NASDAQ
Marketplace Rule 4350 provides that foreign private issuers may elect to follow certain home country corporate governance practices
so long as they provide NASDAQ with a letter from outside counsel in its home country certifying that the issuer 's corporate
governance practices are not prohibited by home country law.
On
July 19, 2005, we submitted a letter to NASDAQ certifying that certain of Bonso's corporate governance practices are not
prohibited by the relevant laws of the British Virgin Islands. We will follow British Virgin Island law in respect to the following
requirements:
•
A
                                         majority of Bonso's Board of Directors will not be independent;
•
Bonso
                                         will not have a nominating committee;
•
Bonso
                                         will not have a compensation committee;
•
Bonso's
                                         independent directors will not meet in executive session; and
•
Bonso's
                                         audit committee may have only one member.
Audit
Committee
Mr.
Woo-Ping Fok is the sole member of the Audit Committee and Mr. Schlueter serves as an ad hoc member. Mr. Fok is "independent"
as defined in the NASDAQ listing standards, and Mr. Schlueter may not be considered "independent" since his law firm
serves as Bonso's United States counsel.
The
Audit Committee was established to: (i) review and approve the scope of audit procedures employed by our independent auditors;
(ii) review and approve the audit reports rendered by our independent auditors; (iii) approve the audit fee charged by the independent
auditors; (iv) report to the Board of Directors with respect to such matters; (v) recommend the selection of independent auditors;
and (vi) discharge such other responsibilities as may be delegated to it from time to time by the Board of Directors. Effective
as of June 30, 2015, the Board of Directors adopted an amended charter for its Audit Committee.
Employees
At
March 31, 2015, we employed a total of 528 persons, as compared to 663 persons at March 31, 2014 and 1,127 persons at March 31,
2013; 8 employees in Hong Kong (12 in 2014 and 13 in 2013) and 520 employees in China (651 in 2014 and 1,114 in 2013). Employees
are not covered by collective bargaining agreements. We consider our global labor practices and employee relations to be good.
66
Share
Ownership
The
following table shows the number of shares of common stock beneficially owned by our directors and executive officers as of July
15, 2015:
Name
Shares of
Common
Stock
Owned of
Record
Options Held
Total Number of Shares of
Common
Stock
Beneficially
Owned
Percent
of
Beneficial
Ownership
Anthony So
2,281,770
(1)
300,000
(2)
2,581,770
46.5
%
Andrew
So
453,000
250,000
(3)
703,000
12.8
%
Albert So
250,000
120,000
(4)
370,000
6.9
%
Kim
Wah Chung
93,700
80,000
(5)
173,700
3.3
%
Woo-Ping
Fok
66,507
60,000
(6)
126,507
2.4
%
Henry
F. Schlueter
34,000
60,000
(7)
94,000
1.8
%
All Directors and Officers as a group (6)
3,178,997
870,000
4,048,977
66.2
%
persons)
Note: The number of shares outstanding is 5,246,903 shares, with 5,577,639 total number of shares issued, which includes 330,736 shares in treasury.  The calculations above are based upon the number of shares issued of 5,246,903.
(1)
Includes
                                         1,143,421 shares of common stock owned of record by a corporation that is wholly owned
                                         by a trust of which Mr. So is the sole beneficiary.
67
(2)
Includes
                                         options to purchase 150,000 shares of common stock at an exercise price of $1.50 per
                                         share expiring on March 31, 2020 and options to purchase 150,000 shares of common stock
                                         at an exercise price of $1.50 per share expiring on March 31, 2025.
(3)
Includes
                                         options to purchase 125,000 shares of common stock at an exercise price of $1.50 per
                                         share expiring on March 31, 2020 and, options to purchase 125,000 shares of common stock
                                         at an exercise price of $1.50 per share expiring on March 31, 2025.
(4)
Includes
                                         options to purchase 60,000 shares of common stock at an exercise price of $1.50 per share
                                         expiring on March 31, 2020 and options to purchase 60,000 shares of common stock at an
                                         exercise price of $1.50 per share expiring on March 31, 2025.
(5)
Includes
                                         options to purchase 40,000 shares of common stock at an exercise price of $1.50 per share
                                         expiring on March 31, 2020 and options to purchase 40,000 shares of common stock at an
                                         exercise price of $1.50 per share expiring on March 31, 2025.
(6)
Includes
                                         options to purchase 10,000 shares of common stock at an exercise price of $4.50 per share
                                         expiring on December 4, 2015, options to purchase 25,000 shares of common stock at an
                                         exercise price of $1.50 per share expiring on March 31, 2020 and options to purchase
                                         25,000 shares of common stock at an exercise price of $1.50 per share expiring on March
                                         31, 2025.
(7)
Includes
                                         options to purchase 10,000 shares of common stock at an exercise price of $4.50 per share
                                         expiring on December 4, 2015, options to purchase 25,000 shares of common stock at an
                                         exercise price of $1.50 per share expiring on March 31, 2020 and options to purchase
                                         25,000 shares of common stock at an exercise price of $1.50 per share expiring on March
                                         31, 2025.
Stock
Option and Bonus Plans
The
1996 Stock Option Plan
In
October 1996, our stockholders adopted the 1996 Stock Option Plan (the "Employees' Plan"), which provides for
the grant of options to purchase an aggregate of not more than 400,000 shares of our common stock. In January 2000, our shareholders
approved the proposal of the Board of Directors to increase from 400,000 to 900,000 in the aggregate the number of options to
purchase common stock under the Employees' Plan. The purpose of the Employees' Plan is to make options available to
management and employees in order to encourage them to secure or increase on reasonable terms their stock ownership and to encourage
them to remain with the Company.
The
Employees' Plan is administered by a committee appointed by the Board of Directors which determines the persons to be granted
options under the Employees' Plan, the number of shares subject to each option, the exercise price of each option and the
option period, subject to the requirement that no option may be exercisable more than ten years after the date of grant. The exercise
price of an option may be less than the fair market value of the underlying shares of common stock. No options granted under the
Employees' Plan are transferable by the optionee other than by will or the laws of descent and distribution, and each option
will be exercisable during the lifetime of the optionee only by such optionee.
68
The
exercise price of an option granted pursuant to the Employees' Plan may be paid in cash, by the surrender of options, in
common stock, in other property, including the optionee's promissory note, or by a combination of the above, at our discretion.
During
the fiscal year ended March 31, 2015, no options were granted under the Employees' Plan. As of July 15, 2015, there are
30,000 options outstanding which were issued under the 1996 Stock Option Plan.
The
2004 Stock Option Plan
On
March 23, 2004, our stockholders adopted the 2004 Stock Option Plan (the "2004 Plan"), which provided for the grant
of up to six hundred thousand (600,000) shares of the Company's common stock in the form of stock options, subject to certain
adjustments as described in the 2004 Plan. At the Annual Meeting of Shareholders held on March 20, 2015, the shareholders approved
an amendment to the 2004 Plan to increase the number of shares that could be granted from 600,000 to 850,000.
The
purpose of the 2004 Plan is to secure key employees to remain in the employ of the Company and to encourage such employees to
secure or increase on reasonable terms their common stock ownership in the Company. The Company believes that the 2004 Plan promotes
continuity of management and increased incentive and personal interest in the welfare of the Company.
The
2004 Plan is administered by a committee appointed by the Board of Directors, which consists of at least two but not more than
three members of the Board, one of whom shall be a non-employee of the Company. The committee members currently are Anthony So
and Woo-Ping Fok. The committee determines the specific terms of the options granted, including the employees to be granted options
under the plan, the number of shares subject to each option grant, the exercise price of each option and the option period, subject
to the requirement that no option may be exercisable more than 10 years after the date of grant. The exercise price of an option
may be less than the fair market value of the underlying shares of common stock. No options granted under the plan will be transferable
by the optionee other than by will or the laws of descent and distribution, and each option will be exercisable during the lifetime
of the optionee only by the optionee.
69
The
exercise price of an option granted pursuant to the 2004 Plan may be paid in cash, by the surrender of options, in common stock,
in other property, including a promissory note from the optionee, or by a combination of the above, at the discretion of the Committee.
As
of March 31, 2015, no options had been granted under the 2004 Plan; however, effective July 9, 2015, the Board of Directors approved
the issuance of an aggregate of 850,000 options to officers and directors of the Company at an exercise price of $1.50 per share.
As of July 15, 2015, there are 850,000 options outstanding which were issued under the 2004 Plan.
2004
Stock Bonus Plan
On
September 7, 2004, our stockholders adopted the 2004 Stock Bonus Plan (the "Stock Bonus Plan"), which authorizes the
issuance of up to five hundred thousand (500,000) shares of the Company's Common Stock in the form of a stock bonus.
The
purpose of this Stock Bonus Plan is to: (i) induce key employees to remain in the employ of the Company or of any subsidiary of
the Company; (ii) encourage such employees to secure or increase their stock ownership in the Company; and (iii) reward employees,
non-employee directors, advisors and consultants for services rendered, or to be rendered, to or for the benefit of the Company
or any of its subsidiaries. The Company believes that the Stock Bonus Plan will promote continuity of management and increased
incentive and personal interest in the welfare of the Company.
The
Stock Bonus Plan is administered by a committee appointed by the Board of Directors which consists of at least two but not more
than three members of the Board, one of whom shall be a non-employee of the Company. The Committee members currently are Anthony
So and Woo-Ping Fok. The Committee has the authority, in its sole discretion: (i) to determine the parties to receive bonus stock,
the times when they shall receive such awards, the number of shares to be issued and the time, terms and conditions of the issuance
of any such shares; (ii) to construe and interpret the terms of the Stock Bonus Plan; (iii) to establish, amend and rescind rules
and regulations for the administration of the Stock Bonus Plan; and (iv) to make all other determinations necessary or advisable
for administering the Stock Bonus Plan.
As
of March 31, 2015, no shares had been granted under the Stock Bonus Plan.
70
Item
7. Major Shareholders and Related Party Transactions
Major
shareholders
We
are not directly or indirectly owned or controlled by any foreign government or by another corporation. The following table sets
forth, as of July 15, 2015, beneficial ownership of our common stock by each person, to the best of our knowledge, known to own
beneficially 5% or more of our common stock outstanding as of such date. Except as otherwise indicated, all shares are owned directly
and hold equal voting rights.
Name
Shares
                                         of
Common
Stock
                                         Owned
Options
                                         to Purchase
Common
Stock
Percent
                                         of Beneficial
Ownership
(1)
Anthony So
2,281,770
(2)
300,000
46.5
%
Andrew So
453,000
250,000
12.8
%
Albert So
250,000
120,000
6.9
%
CAS Corporation
290,654
(3)
—
5.5
%
(1)
The
                                         number of shares outstanding is 5,246,903 shares, with 5,577,639 total number of shares
                                         issued, which includes 330,736 shares in treasury. The calculations above are based upon
                                         the number of shares issued of 5,246,903.
(2)
Includes
                                         1,143,421 shares of common stock owned of record by a corporation that is wholly owned
                                         by a trust of which Mr. So is the sole beneficiary.
(3)
According
                                         to the Schedule 13D filed by CAS Corporation on December 11, 2007.
There
are no arrangements known to us which may at a subsequent date result in a change in control of the Company.
Related
Party Transactions
During
the fiscal years ended March 31, 2013, 2014 and 2015, we paid Schlueter & Associates, P.C. an aggregate of $74,000,
$84,000 and $55,000, respectively for legal fees. Mr. Henry F. Schlueter, a director of the Company, is the Managing Director
of Schlueter & Associates, P.C.
During
the fiscal year ended March 31, 2015, Anthony So, our Chairman and Chief Executive Officer, made an interest-free loan to Bonso
Advanced Technology Limited, a subsidiary of Bonso Electronics International Inc., in the principal amount of HK$4,200,000 (approximately
US$538,000 as of the date of the loan). The loan is payable in 48 equal monthly installments of HK$87,500 each (approximately
US$11,000), commencing on October 31, 2014. As of March 31, 2015, the Company had repaid approximately $67,000 to Mr. Anthony
So, and the balance of the loan due to Mr. Anthony So was approximately $471,000.
71
During
the fiscal year ended March 31, 2015, one of our subsidiaries in Shenzhen, PRC entered into a rental agreement with a director
and shareholder, Mr. Anthony So, for three apartment units located in Shenzhen, PRC for office usage. Mr. Anthony So is the sole
owner of these three apartment units. The monthly rental payment was approximately $2,000, and the total rent paid to Mr. Anthony
So during the fiscal year ended March 31, 2015 was approximately $10,000.
During
the fiscal year ended March 31, 2015, one of our subsidiaries in Xinxing, PRC entered into a rental agreement with a director
and shareholder, Mr. Andrew So, for an apartment unit located in Xinxing, PRC for staff quarters. Mr. Andrew So is the sole owner
of this apartment unit. The monthly rental payment was approximately $480, and the total rent paid to Mr. Andrew So during the
fiscal year ended March 31, 2015 was approximately $2,000.
During
the fiscal year ended March 31, 2014, we made loans aggregating approximately $1,052,000 to our Chairman and Chief Executive Officer,
Anthony So. Management believed at the time that the loans were made that these loans were permissible and did not violate Section
13(k) of the Exchange Act, because Mr. So would be able to repay the full amount by foregoing his salary and accrued annual leave
payments until the loans had been paid in full.
We
advanced the funds to Mr. So on two separate occasions, and Mr. So directed that his salary payments and accrued annual leave
payments be used to offset the amounts that we loaned to him. In addition, Mr. Albert So and Mr. Andrew So, who are officers and
directors of the Company, directed the Company to use their accrued annual leave payments to partially satisfy the amounts due
to the Company from Mr. Anthony So. On March 31, 2014, the amount due to the Company from Mr. So was $166,000. On August 7, 2014,
Mr. So paid $166,000 to the Company to fully repay the amounts loaned to him. The loans were non-interest bearing.
Notwithstanding
Mr. Anthony So's repayment in full of the loans made to him, those loans constitute a violation of Section 13(k) of the
Exchange Act and Section 402(a) of the Sarbanes-Oxley Act.
As
a result of this inadvertent violation, the Board adopted a policy regarding loans or advances to any Executive Officer or Director
of the Company. The policy provides that "The Company shall not directly or indirectly, including through any subsidiary,
extend or maintain credit to, or arrange for the extension of credit, or renew an extension of credit, in the form of a personal
loan to or for any Director or Executive Officer (or equivalent thereof) of the Company or any subsidiary of the Company."
72
Interests
of Experts and Counsel
Not
Applicable to Bonso.
Legal
Proceedings
Not
Applicable to Bonso.
Item
8. Financial Information
Financial
Statements
Our
Consolidated Financial Statements are set forth under Item 18. – "Financial Statements."
Item
9. The Offer and Listing
Offer
and Listing Details
Our
common stock is traded only in the United States over-the-counter market. It is quoted on the NASDAQ Capital Market under the
trading symbol "BNSO." The following table sets forth, for the periods indicated, the range of high and low closing
sales prices per share reported by NASDAQ. The quotations represent prices between dealers and do not include retail markup, markdown
or commissions and may not necessarily represent actual transactions.
The
following table sets forth the high and low sale prices for each of the last five years:
Period
High
Low
April 1, 2010 to March 31, 2011
$
2.44
$
0.86
April 1, 2011 to March 31, 2012
$
2.80
$
1.07
April 1, 2012 to March 31, 2013
$
1.88
$
0.88
April 1, 2013 to March 31, 2014
$
2.94
$
1.33
April 1, 2014 to March 31, 2015
$
2.10
$
1.11
73
The
following table sets forth the high and low sale prices during each of the quarters in the two-year period ended June 30, 2015.
Period
High
Low
July 1, 2013 to September 30, 2013
$
1.98
$
1.35
October 1, 2013 to December 31, 2013
$
2.23
$
1.35
January 1, 2014 to March 31, 2014
$
2.94
$
1.46
April 1, 2014 to
June 30, 2014
$
2.10
$
1.34
July 1, 2014 to September
30, 2014
$
2.02
$
1.31
October 1, 2014 to December 31, 2014
$
1.88
$
1.11
January 1, 2015 to March 31, 2015
$
1.57
$
1.24
April 1, 2015 to June 30, 2015
$
1.84
$
1.25
The
following table sets forth the high and low sale prices during each of the most recent six months.
Period
High
Low
January 2015
$
1.44
$
1.25
February 2015
$
1.57
$
1.24
March 2015
$
1.54
$
1.29
April 2015
$
1.70
$
1.25
May 2015
$
1.84
$
1.56
June 2015
$
1.72
$
1.31
On
July 15, 2015, the closing price of our common stock was $1.40. Of the 5,577,639 shares of common stock issued as of June 30,
2015, 5,246,903 shares were outstanding, 2,412,370 shares were held in the United States by 160 holders of record and 330,736
shares were held by the Company as treasury stock. We have 172 shareholders of record.
74
Transfer
and Warrant Agent
The
transfer agent and registrar for the common stock is Computershare, 1745 Gardena Avenue #200, Glendale, California 91204.
Item
10. Additional Information
Share
Capital
Our
authorized capital is $170,000, consisting of 23,333,334 shares of common stock, $0.003 par value per share, and 10,000,000 authorized
shares of preferred stock, $0.01 par value, divided into 2,500,000 shares each of class A preferred stock, class B preferred stock,
class C preferred stock and class D preferred stock. Information with respect to the number of shares of common stock outstanding
at the beginning and at the end of the last three fiscal years is presented in the Consolidated Statements of Changes in Stockholders'
Equity for the fiscal years ended March 31, 2013, 2014 and 2015 included herein in Item 18.
At
July 15, 2015, there were 5,577,639 shares of our common stock issued, 5,246,903 shares were outstanding, and 330,736 shares were
held by the Company in treasury. All shares were fully paid. In addition, we had outstanding 880,000 options to purchase common
stock as follows:
Number of Options
Exercise Price per Share
Expiration Date
30,000
$
4.50
December 4, 2015
425,000
$
1.50
March 31, 2020
425,000
$
1.50
March 31, 2025
At
July 15, 2015, there were no shares of our preferred stock outstanding.
Memorandum
and Articles of Association
We
are registered in the British Virgin Islands and have been assigned company number 9032 in the register of companies. Our registered
agent is HWR Services Limited at Craigmuir Chambers, P.O. Box 71, Road Town, Tortola, British Virgin Islands. The object or purpose
of the Company is to engage in any act or activity that is not prohibited under British Virgin Islands law as set forth in Paragraph
4 of our Memorandum of Association. As an International Business Company, we are prohibited from doing business with persons resident
in the British Virgin Islands, owning real estate in the British Virgin Islands or acting as a bank or insurance company. We do
not believe that these restrictions materially affect our operations.
75
Paragraph
57(c) of our Amended Articles of Association (the "Articles") provides that a director may be counted as one of a
quorum in respect of any contract or arrangement in which the director is materially interested; however, if the agreement or
transaction cannot be approved by a resolution of directors without counting the vote or consent of any interested director, the
agreement or transaction may only be validated by approval or ratification by a resolution of the members. Paragraph 53 of the
Articles allows the directors to vote compensation to themselves in respect of services rendered to the Company. Paragraph 66
of the Articles provides that the directors may by resolution exercise all the powers of the Company to borrow money and to mortgage
or charge its undertakings and property or any part thereof, to issue debentures, debenture stock and other securities whenever
money is borrowed or as security for any debt, liability or obligation of ours or of any third party. Such borrowing powers can
be altered by an amendment to the Articles. There is no provision in the Articles for the mandatory retirement of directors. Directors
are not required to own shares of the Company in order to serve as directors.
Our
authorized share capital is $170,000, divided into 23,333,334 shares of common stock, $0.003 par value, and 10,000,000 authorized
shares of preferred stock, $0.01 par value. Holders of our common stock are entitled to one vote for each whole share on all matters
to be voted upon by shareholders, including the election of directors. Holders of our common stock do not have cumulative voting
rights in the election of directors. All of our common shares are equal to each other with respect to liquidation and dividend
rights. Holders of our common shares are entitled to receive dividends if and when declared by our Board of Directors out of funds
legally available therefor under British Virgin Islands law. In the event of our liquidation, all assets available for distribution
to the holders of our common stock are distributable among them according to their respective holdings. Holders of our common
stock have no preemptive rights to purchase any additional unissued common shares. No shares of our preferred stock have been
issued; however, the Board of Directors has the ability to determine the rights, preferences and restrictions of the preferred
stock at their discretion.
Paragraph
7 of the Memorandum of Association provides that without prejudice to any special rights previously conferred on the holders of
any existing shares, any share may be issued with such preferred, deferred or other special rights or such restrictions, whether
in regard to dividend, voting, return of capital or otherwise, as the directors may from time to time determine.
76
Paragraph
10 of the Memorandum of Association provides that if at any time the authorized share capital is divided into different classes
or series of shares, the rights attached to any class or series may be varied with the consent in writing of the holders of not
less than three-fourths of the issued shares of any other class or series of shares which may be affected by such variation.
Paragraph
105 of the Articles of Association provides that our Memorandum and Articles of Association may be amended by a resolution of
members or a resolution of directors. Thus, our Board of Directors without shareholder approval may amend our Memorandum and Articles
of Association. This includes amendments to increase or reduce our authorized capital stock. Our ability to amend our Memorandum
and Articles of Association without shareholder approval could have the effect of delaying, deterring or preventing a change in
control of the Company, including a tender offer to purchase our common shares at a premium over the then current market price.
Provisions
in respect of the holding of general meetings and extraordinary general meetings are set out in Paragraphs 68 through 77 of the
Articles and under the International Business Companies Act. The directors may convene meetings of the members at such times and
in such manner and places as the directors consider necessary or desirable, and they shall convene such a meeting upon the written
request of members holding more than 30% of the votes of our outstanding voting shares.
British
Virgin Islands law and our Memorandum and Articles of Association impose no limitations on the right of nonresident or foreign
owners to hold or vote our securities. There are no provisions in the Memorandum and Articles of Association governing the ownership
threshold above which shareholder ownership must be disclosed.
A
copy of our Memorandum and Articles of Association, as amended, was filed as an exhibit to our Registration Statement on Form
F-2 (SEC File No. 333-32524).
Material
Contracts
The
following summarizes each material contract, other than contracts entered into in the ordinary course of business, to which Bonso
or any subsidiary of Bonso is a party, for the two years immediately preceding the filing of this report:
We
signed a Banking Facility Letter dated February 26, 2015 with Hang Seng Bank for an approximately HK$48.3 million (or approximately
US$6.2 million) letter of credit, trust receipt facility, export D/P bills, export trade loan, factoring, overdraft facility and
financial instruments including forward contracts. A copy of this Banking Facilities Letter is attached to this Annual Report
on Form 20-F as Exhibit 4.1 and is incorporated herein by this reference.
77
We
signed a Banking Facility Letter dated April 29, 2014 with China Construction Bank for RMB 20 million (or approximately $3.2 million)
for a letter of credit, import loan and term loans. An extract copy of the English translation of the banking facility letter
is attached to this Annual Report on Form 20-F as Exhibit 4.2 and is incorporated herein by this reference.
Exchange
Controls
There
are no exchange control restrictions on payments of dividends on our common stock or on the conduct of our operations either in
Hong Kong, where our principal executive offices are located, or the British Virgin Islands, where we are incorporated. Other
jurisdictions in which we conduct operations may have various exchange controls. Taxation and repatriation of profits regarding
our China operations are regulated by Chinese laws and regulations. With respect to our PRC subsidiaries, with the exception of
a requirement that approximately 11% of profits be reserved for future developments and staff welfare, there are no restrictions
on the payment of dividends and the removal of dividends from China once all taxes are paid and assessed and losses, if any, from
previous years have been made good. To date, these controls have not had, and are not expected to have, a material impact on our
financial results. There are no material British Virgin Islands laws that impose foreign exchange controls on us or that affect
the payment of dividends, interest or other payments to holders of our securities who are not residents of the British Virgin
Islands. British Virgin Islands law and our Memorandum and Articles of Association impose no limitations on the right of nonresident
or foreign owners to hold or vote our securities.
Taxation
No
reciprocal tax treaty regarding withholding exists between the United States and the British Virgin Islands. Under current British
Virgin Islands law, dividends, interest or royalties paid by us to individuals are not subject to tax as long as the recipient
is not a resident of the British Virgin Islands. If we were to pay a dividend, we would not be liable to withhold any tax, but
shareholders would receive gross dividends, if any, irrespective of their residential or national status.
Dividends,
if any, paid to any United States resident or citizen shareholder are treated as dividend income for United States federal income
tax purposes. Such dividends are not eligible for the 70% dividends-received deduction allowed to United States corporations on
dividends from a domestic corporation under Section 243 of the Internal Revenue Code. Various Internal Revenue Code provisions
impose special taxes in certain circumstances on non-United States corporations and their shareholders. You are urged to consult
your tax advisor with regard to such possibilities and your own tax situation.
A
foreign corporation will be treated as a passive foreign investment company ("PFIC") for United States federal income
tax purposes if, after applying relevant look-through rules with respect to the income and assets of subsidiaries, 75% or more
of its gross income consists of certain types of passive income or 50% or more of the gross value of its assets is attributable
to assets that produce passive income or are held for the production of passive income. For this purpose, passive income generally
includes dividends, interest, royalties, rents (other that rents and royalties derived in the active conduct of a trade or business),
annuities and gains from assets that produce passive income. We presently believe that we are not a PFIC and do not anticipate
becoming a PFIC. This is, however, a factual determination made on an annual basis and is subject to change. If we were to be
classified as a PFIC in any taxable year, (i) U.S. holders would generally be required to treat any gain on sales of our
shares held by them as ordinary income and to pay an interest charge on the value of the deferral of their United States federal
income tax attributable to such gain and (ii) distributions paid by us to our United States holders could also be subject
to an interest charge. In addition, we would not provide information to our United States holders that would enable them to make
a "qualified electing fund" election under which, generally, in lieu of the foregoing treatment, our earnings would
be currently included in their United States federal income.
In
addition to United States federal income taxation, shareholders may be subject to state and local taxes upon their receipt of
dividends.
Documents
on Display
You
may read and copy documents referred to in this Annual Report on Form 20-F that have been filed with the SEC at the SEC's
Public Reference Room, 450 Fifth Street, N.W., Washington, D.C. You may obtain information on the operation of the Public Reference
Room by calling the SEC at 1-800-SEC-0330. You can also obtain copies of our SEC filings by going to the SEC's website at
http://www.sec.gov.
The
SEC allows us to "incorporate by reference" the information we file with the SEC. This means that we can disclose
important information to you by referring you to another document filed separately with the SEC. The information incorporated
by reference is considered to be part of this Annual Report on Form 20-F.
78
Item
11. Quantitative and Qualitative Disclosures About Market Risk
We
are exposed to a certain level of interest rate risk and foreign currency exchange risk.
Interest
Rate Risk
Our
interest rate risk primarily arises from our bank borrowings and our general banking facilities. As at March 31, 2015, we
had utilized approximately $5,206,000 of our total banking facilities of $9,438,000. Based on the maturity profile and
composition of our long-term debt and general banking facilities, including the fact that our banking facilities are at
variable interest rates, we estimate that changes in interest rates will not have a material impact on our operating results
or cash flows. We intend to manage our interest rate risk through appropriate borrowing strategies. We have not entered into
interest rate swap or risk management agreements; however, it is possible that we may do so in the future.
A
summary of our debts as at March 31, 2015 which were subject to variable interest rates is as below:
March 31,
Interest
2015
Rate
Notes payable
$
1,830,000
HIBOR
(1)
+ 2.5%
Bank overdraft - secured
$
nil
PRIME + 1%
Factoring
$
nil
HIBOR
(1)
+ 1.5%
Short term loans
$
1,026,000
HIBOR
(1)
+ 2.25%,
Long term loans
(2)
$
2,350,000
HIBOR
(1)
+ 2.25%, and
People's Bank of China's loan benchmark interest rate times 110% for loans in PRC
(1)
HIBOR is the Hong Kong Interbank Offer Rate.
(2)
A clause in the banking facilities states that the term loans are subject to review any time and also subject to the bank's
overriding right of repayment on demand, including the right to call for cash cover on demand for prospective and contingent liabilities.
Therefore, all long-term loans were classified as current liabilities in the consolidated balance sheets.
A
change in the interest rate of 1% will increase or decrease the interest expense of the Company by approximately $63,000.
79
For
further information concerning our banking facilities, the interest rates payable and repayment terms, please see Note 7 to our
Consolidated Financial Statements included elsewhere in this Annual Report.
Foreign
Currency Exchange Rates
For
a discussion of our Foreign Currency Exchange Risk, See Item 5. – "Operating and Financial Review and Prospects -
Foreign Currency Exchange Rates."
Item
12. Description of Securities Other Than Equity Securities
Not
applicable to Bonso.
PART
II
Item
13. Defaults, Dividend Arrearages and Delinquencies
None.
Item
14. Material Modifications to the Rights of Security Holders and Use of Proceeds
None.
Item
15. Controls and Procedures
The
Company's management, with the participation of Andrew So, its Chief Operating Officer, and Albert So, its Chief Financial
Officer, conducted an evaluation of our disclosure controls and procedures, as defined in paragraph (e) of Rule 13a-15 or 15d-15
under the Exchange Act, as of March 31, 2015. Our Company's internal control over financial reporting is a process designed under
the supervision of the Chief Executive Officer, the Chief Operating Officer and the Chief Financial Officer to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies
and procedures that:
1.
pertain
                                         to the maintenance of records that, in reasonable detail, accurately and fairly reflect
                                         the transactions and dispositions of our assets;
2.
provide
                                         reasonable assurance that transactions are recorded as necessary to permit preparation
                                         of financial statements in accordance with generally accepted accounting principles,
                                         and that receipts and expenditures of our Company are being made only in accordance with
                                         authorizations of our management and directors; and
3.
provide
                                         reasonable assurance regarding prevention or timely detection of unauthorized acquisition,
                                         use or disposition of assets that could have a material effect on the financial statements.
80
There
are inherent limitations in the effectiveness of any internal control, including the possibility of human error and the circumvention
or overriding of controls. Accordingly, even effective internal controls can provide only reasonable assurances with respect to
financial statement preparation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures
may deteriorate.
In
making this assessment, management used the criteria established in 2013 Internal Control—Integrated Framework issued by
the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on the assessment, the Company's management,
including its Chief Operating Officer and Chief Financial Officer, have concluded that, as of March 31, 2015, there were certain
material weaknesses in our internal controls, over financial reporting related to our financial closing process, the lack of trained
accounting personnel and the failure to enter certain transactions into the accounting records on a timely basis. All three of
these weaknesses were identified in the Form 20-F that we filed during the previous year.
•
We
                                         have not maintained effective internal control over the financial closing process to
                                         provide reasonable assurance that the financial statements are prepared in accordance
                                         with Generally Accepted Accounting Principles (GAAP).
•
We
                                         did not have:
•
a
                                         sufficient number of experienced personnel in our accounting and finance departments
                                         to provide reasonable assurance that transactions were being recorded, and adequate supervisory
                                         reviews and monitoring activities over financial reporting matters and controls performed,
                                         as necessary to permit the preparation of the financial statements in accordance with
                                         GAAP;
•
timely
                                         and accurate preparation and review of period-end account analyses and timely disposition
                                         of any required adjustments; and
•
adequate
                                         training of and communication to employees regarding their duties and control responsibilities
                                         within the accounting and finance organization to ensure that processes and control activities
                                         were being carried out appropriately.
These
material weaknesses resulted in material post-closing adjustments reflected in the financial statements for the year ended March
31, 2015. These adjustments resulted in changes to assets, liabilities, stockholders' equity, income and expenses.
81
During
the fiscal year ended March 31, 2014, we identified additional material weaknesses, relating to the conduct of our year end
inventory count, and the approval of loans to an officer and director in violation of Section 13(k) adopted under the
Exchange Act as more particularly described below. We have taken certain remedial actions to address these matters and
management does not believe that these material weaknesses exist    as of March 31, 2015. The remedial actions we took to
address these two weaknesses included the following:
•
The
                                         Company built a new warehouse in order to enhance categorizing and storage of inventory.
                                         Also, a new warehouse supervisor was employed who was a former employee of the Company's
                                         old Shenzhen factory to oversee the warehouse control of all inventories.
•
The
                                         Company hired a new accounting manager with 20 years of experience in wholly-owned foreign
                                         enterprises, for training, reviewing and controlling all the daily bookkeeping and financial
                                         report closing activities.
•
The
                                         Board adopted a policy regarding loans or advances to any Executive Officer or Director
                                         of the Company subsequent to March 31, 2014. The policy provides that "The Company
                                         shall not directly or indirectly, including through any subsidiary, extend or maintain
                                         credit to, or arrange for the extension of credit, or renew an extension of credit, in
                                         the form of a personal loan to or for any Director or Executive Officer (or equivalent
                                         thereof) of the Company or any subsidiary of the Company."
•
Management
                                         and the Directors of the Company received training with respect to various requirements
                                         under the securities laws of the United States, including "insider trading,"
                                         US reporting requirements for foreign private issuers and requirements imposed upon the
                                         Company under Sarbanes-Oxley and Dodd-Frank.
Notwithstanding
the identified material weaknesses, management believes the consolidated financial statements included in this Annual Report on
Form 20-F fairly present in all material respects our financial condition, results of operations and cash flows at and for the
periods presented in accordance with U.S. GAAP.
Remediation
Efforts
In
response to the material weaknesses described above, management intends to do the following:
•
Provide
                                         further training and communication to its accounting staff with regard to the recording
                                         of transactions in the accounting records, and closing procedures and practices.
•
Increase
                                         supervisory review and monitoring activities over financial reporting matters and controls.
•
Consider
                                         hiring either an additional experienced accountant with U.S. GAAP experience or outside
                                         consultants to work with the Company and its accounting staff.
82
If
the remedial measures described above are insufficient to address any of the identified material weaknesses or are not implemented
effectively, or additional deficiencies arise in the future, material misstatements in our interim or annual financial statements
may occur in the future. We are currently working to implement enhanced controls, as discussed above, to address the material
weaknesses in our internal control over financial reporting and to remedy the ineffectiveness of our disclosure controls and procedures.
A key element of our remediation effort is the ability to recruit and retain qualified individuals to support our remediation
efforts. While our Audit Committee and Board of Directors have been supportive of our efforts by supporting the hiring of various
individuals in finance, as well as funding efforts to improve our financial reporting system, improvement in internal control
will be hampered if we cannot recruit and retain more qualified professionals. Among other things, any unremediated material weaknesses
could result in material post-closing adjustments in future financial statements. Furthermore, any such unremediated material
weaknesses could have the effects described above in the Risk Factor captioned "We have identified material weaknesses in
our internal control over financial reporting which could, if not remediated, result in material misstatements in our financial
statements." Management believes that the remediation items listed above, if executed, will ensure that data and reports
can be relied upon for the purpose of accurately and timely recording transactions in accordance with GAAP.
Changes
in Internal Controls
There
were no changes in the Company's internal controls during the period covered by this Report that have materially affected
or are reasonably likely to materially affect our internal control over financial reporting.
Item
16. Reserved
Item
16A. Audit Committee Financial Expert
Henry
F. Schlueter is an ad hoc member of the Company's Audit Committee and is deemed to be a financial expert. Mr. Schlueter,
the Company's outside securities counsel, may not be deemed to be "independent" within the definition of "independence"
published by NASDAQ.
83
Item
16B. Code of Ethics
We
have adopted a code of ethics that applies to our Chief Executive Officer and Chief Financial Officer. We intend to disclose any
changes in, or waivers from, our code of ethics by filing a Form 6-K. Stockholders may request a free copy in print form
from our Chief Financial Officer at:
Bonso
Electronics International, Inc.
Unit
1404, 14/F, Cheuk Nang Centre
9
Hillwood Road, Tsimshatsui
Kowloon
Hong
Kong
Item
16C. Principal Accountant Fees and Services
Audit
Committee's Pre-approval Policies and Procedure
The
Audit Committee must pre-approve the audit and non-audit services performed by the independent auditor in order to assure that
the provision of such services does not impair the auditor's independence. Before the Company or any of its subsidiaries engage
the independent auditor to render a service, the engagement must be either:
(1)	specifically
approved by the Audit Committee; or
(2)	entered
into pursuant to this Pre-Approval Policy.
The
term of any pre-approval is 12 months from the date of pre-approval, unless the Audit Committee specifically provides for a different
period. The Audit Committee may periodically revise the list of pre-approved services.
The
Audit Committee may delegate pre-approval authority to one or more of its members. The member or members to whom such authority
is delegated shall report any pre-approval decisions to the Audit Committee at its next scheduled meeting. The Audit Committee
may not delegate to management the Audit Committee's responsibilities to pre-approve services performed by the independent auditor.
The
Audit Committee must specifically pre-approve the terms of the annual audit services engagement. The Audit Committee shall approve,
if necessary, any changes in terms resulting from changes in audit scope, Company structure or other matters. In addition to the
annual audit services engagement approved by the Audit Committee, the Audit Committee may grant pre-approval for other audit services,
which are those services that only the independent auditor reasonably can provide.
84
The
Audit Committee may grant pre-approval to those permissible non-audit services classified as other services that it believes would
not impair the independence of the auditor, including those that are routine and recurring services.
The
Audit Committee may consider the amount or range of estimated fees as a factor in determining whether a proposed service would
impair the auditor's independence. Where the Audit Committee has approved an estimated fee for a service, the pre-approval applies
to all services described in the approval. However, in the event the invoice in respect of any such service is materially in excess
of the estimated amount or range, the Audit Committee must approve such excess amount prior to payment of the invoice. The Audit
Committee expects that any requests to pay invoices in excess of the estimated amounts will include an explanation as to the reason
for the overage. The Company's independent auditor will be informed of this policy.
The
Company's management shall inform the Audit Committee of each service performed by the independent auditor pursuant to this
Pre-Approval Policy. Requests or applications to provide services that require separate approval by the Audit Committee shall
be submitted to the Audit Committee by both the independent auditor and the Chief Financial Officer and must include a joint statement
as to whether, in their view, the request or application is consistent with the SEC's and the Public Company Accounting
Oversight Board (United States)'s rules on auditor independence.
The
Audit Fees indicated below were pre-approved by the Audit Committee before the auditor commenced their work.
Audit
Fees
The
aggregate fees billed by Moore Stephens CPA Limited for professional services rendered for the audit of the Company's annual
consolidated financial statements for the fiscal years ended March 31, 2015 and 2014 were $190,000 and $200,000, respectively.
Audit
Related Fees
There
were no fees billed by Moore Stephens CPA Limited for professional services rendered for assurance and related services that were
reasonably related to the performance of the audit and are not reported above under "Audit Fees" for the fiscal year
ended March 31, 2015 and for the fiscal year ended March 31, 2014.
85
Tax
Fees
The
aggregate fees billed for professional services rendered for tax compliance for the fiscal year ended March 31, 2015 were approximately
$3,600 and $4,500 for the fiscal year ended March 31, 2014.
Item
16D. Exemptions from the Listing Standards for Audit Committees
Pursuant
to NASDAQ Marketplace Rule 4350(a), a foreign private issuer may follow its home country practice in lieu of Rule 4350, which
sets forth the qualitative Listing Requirements for NASDAQ listed companies. Rule 4350 requires, among other things, that a listed
company have at least three members on its audit committee. The Company currently has an audit committee consisting of two directors,
one of whom is deemed to be "independent" as defined in NASDAQ Marketplace Rule 4200. The Company has obtained a letter
from independent counsel in the British Virgin Islands certifying that having a single member audit committee is not prohibited
by British Virgin Island law. See "NASDAQ Exemptions and Home Country Practices."
Item
16E. Purchasers of Equity Securities by the Issuer and Affiliated Purchasers
In
August of 2001, the Company's Board of Directors authorized a program for the Company to repurchase up to $500,000 of its common
stock. This repurchase program does not obligate the Company to acquire any specific number of shares or acquire shares over any
specified period of time. No stocks had been repurchased up to March 31, 2006. On November 16, 2006, the Company's Board of Directors
authorized an additional $1,000,000 for the Company's repurchase of its common stock under the same repurchase program.
This authorization to repurchase shares increased the amount authorized for repurchase from $500,000 to $1,500,000. The Company
(through its subsidiary) has repurchased an aggregate of 330,736 shares of its common stock, including 70,019 ($134,000) shares
that were repurchased during the fiscal year ended March 31, 2009. No shares were repurchased during the fiscal years ended March
31, 2013, 2014 and 2015. The Company may from time to time repurchase shares of its Common Stock under this program.
Item
16F. Changes in Registrant's Certifying Accountants.
Not
applicable to Bonso.
86
Item
16G. Corporate Governance.
For
a discussion of the ways in which the Company's corporate governance differs from those followed by domestic companies under
the NASDAQ Marketplace listing requirements, see "NASDAQ Exemptions and Home Country Practices" above.
Item
16H. Mine Safety Disclosure.
Not
applicable to Bonso.
PART
III
Item
17. Financial Statements
Not
applicable.
Item
18. Financial Statements
The
following Financial Statements are filed as part of this Annual Report:
Page
Report of Independent Registered Public Accounting Firm
F-1
Consolidated Balance Sheets as of March 31, 2014 and 2015
F-2
Consolidated Statements of Operations and Comprehensive	(Loss)
    / Income for the years ended March 31, 2013, 2014 and 2015
F-3
Consolidated Statements of Changes in Stockholders' Equity
    for the		years ended March 31, 2013, 2014 and 2015
F-4
Consolidated
                                         Statements of Cash Flows for the years ended
March
31, 2013, 2014 and 2015
F-5
Notes to Consolidated Financial Statements
F-6 through F-40
87
Item 19. Exhibits
4.1
Banking
                                                                                                                                                           Facility
                                                                                                                                                           Letter,
                                                                                                                                                           dated
                                                                                                                                                           February
                                                                                                                                                           26,
                                                                                                                                                           2015
                                                                                                                                                           between
                                                                                                                                                           Bonso
                                                                                                                                                           and
                                                                                                                                                           the
                                                                                                                                                           Hang
                                                                                                                                                           Seng
                                                                                                                                                           Bank Limited
4.2
Banking
                                         Facility Letter, dated April 29, 2014 between Bonso and China Construction Bank of China
12.1
Certification
                                         of Officer Pursuant to Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley
                                         Act of 2002
12.2
Certification
                                                                                                                                of
                                                                                                                                Officer
                                                                                                                                Pursuant
                                                                                                                                to
                                                                                                                                Section
                                                                                                                                1350,
                                                                                                                                as
                                                                                                                                adopted
                                                                                                                                pursuant
                                                                                                                                to
                                                                                                                                Section
                                                                                                                                302
                                                                                                                                of
                                                                                                                                the
                                                                                                                                Sarbanes-Oxley
                                                                                                                                Act
                                                                                                                                of
                                                                                                                                2002
13.1
Certification
                                                                                                                                Pursuant
                                                                                                                                to
                                                                                                                                18
                                                                                                                                U.S.C.
                                                                                                                                1350
                                                                                                                                as
                                                                                                                                adopted
                                                                                                                                pursuant
                                                                                                                                to
                                                                                                                                Section
                                                                                                                                906
                                                                                                                                of
                                                                                                                                the
                                                                                                                                Sarbanes-Oxley
                                                                                                                                Act
                                                                                                                                of
                                                                                                                                2002
13.2
Certification
                                                                                                                                Pursuant
                                                                                                                                to
                                                                                                                                18
                                                                                                                                U.S.C.
                                                                                                                                1350
                                                                                                                                as
                                                                                                                                adopted
                                                                                                                                pursuant
                                                                                                                                to
                                                                                                                                Section
                                                                                                                                906
                                                                                                                                of
                                                                                                                                the
                                                                                                                                Sarbanes-Oxley
                                                                                                                                Act
                                                                                                                                of
                                                                                                                                2002
(1)
Filed
                                                                                                                               as
                                                                                                                               an
                                                                                                                               Exhibit
                                                                                                                               on
                                                                                                                               Form
                                                                                                                               20-F
                                                                                                                               filed
                                                                                                                               with
                                                                                                                               the
                                                                                                                               Commission
                                                                                                                               on
                                                                                                                               August
                                                                                                                               15,
                                                                                                                               2013.
(2)
Filed
                                         as an Exhibit on Form 20-F filed with the commission on August 13, 2004.
14.1
Code
                                         of Business Conduct and Ethics
14.2
Code
                                         of Ethics for Senior Financial Officers
14.3
Foreign
                                         Corrupt Practices Act Compliance Policy
14.4
Whistleblower
                                         Policy
99.1
Audit Committee Charter, as amended effective June 30, 2015
88
SIGNATURE
The
registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized
the undersigned to sign this Annual Report on its behalf.
BONSO ELECTRONICS INTERNATIONAL INC.
Dated: August 14, 2015
/s/ Anthony So
Anthony
So, Chairman of the Board, Chief 	Executive Officer and Director
Dated:
    August 14,     2015
/s/ Albert So
Albert
So, Chief Financial Officer, Treasurer and Secretary
89
Bonso Electronics International Inc.
(Incorporated in the British Virgin Islands)
Consolidated Financial Statements
March 31, 2015
Bonso Electronics International Inc.
Index to Consolidated Financial Statements
Contents
Pages
Report of Independent Registered Public Accounting Firm
F-1
Consolidated Balance Sheets as of March
31, 2014 and 2015
F-2
Consolidated Statements of Operations and
Comprehensive (Loss) / Income for the years ended March 31, 2013, 2014 and 2015
F-3
Consolidated Statements of Changes in Stockholders'
Equity for the years ended March 31, 2013, 2014 and 2015
F-4
Consolidated Statements of Cash Flows for
the years ended March 31, 2013, 2014 and 2015
F-5
Notes to Consolidated Financial Statements
F-6 to F-40
Report of Independent Registered Public
Accounting Firm
To the Board of Directors and Stockholders of
Bonso Electronics International Inc.
We have audited the accompanying consolidated
balance sheets of Bonso Electronics International Inc. and subsidiaries (the "Company") as of March 31, 2014 and 2015
and the related consolidated statements of operations and comprehensive (loss) / income, changes in stockholders' equity,
and cash flows for each of the three years in the period ended March 31, 2015. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial
statements based on our audits.
We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.
Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the Company's
internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the consolidated financial position of the Company as of
March 31, 2014 and 2015, and the consolidated results of its operations and its cash flows for each of the three years in the period
ended March 31, 2015, in conformity with accounting principles generally accepted in the United States of America.
/s/ Moore Stephens CPA Limited
Moore Stephens CPA Limited
Certified Public Accountants
Hong Kong
August 14, 2015
-F-1-
Bonso Electronics International Inc.
Consolidated Balance Sheets
(Expressed in United States Dollars)
March 31,
Note
2014
2015
$ in thousands
$ in thousands
Assets
Current assets
Cash and cash equivalents
116
3,027
Fixed deposits maturing over three months
1,049
—
Trade receivables, net
2
2,480
1,306
Other receivables, deposits and prepayments
1,781
1,154
Receivable from affiliated party
15
166
—
Inventories
3
7,545
3,121
Financial instruments at fair value
9
—
391
Income tax recoverable
1,740
39
Total current assets
14,877
9,038
Investment in life insurance contract
10
131
136
Deposits
293
—
Property, plant and equipment
Buildings
14,339
17,056
Construction-in-progress
3,183
427
Plant and machinery
11,276
9,847
Furniture, fixtures and equipment
1,170
1,325
Motor vehicles
589
572
30,557
29,227
Less: accumulated depreciation and impairment
(18,105
)
(16,743
)
Property, plant and equipment, net
4
12,452
12,484
Intangible assets, net
6
4,387
4,119
Total assets
32,140
25,777
Liabilities and stockholders' equity
Current liabilities
Bank overdrafts - secured
7
630
—
Notes payable - secured
7
2,527
1,830
Accounts payable
10,413
4,791
Accrued charges and deposits
2,597
3,117
Income tax liabilities
8
7
7
Payable to affiliated parties
15
10
66
Bank loans - secured
7
2,320
3,376
Financial instruments at fair value
9
119
84
Current portion of capital lease obligations
11
(a)
23
23
Loan from affiliated party - current portion
15
—
135
Total current liabilities
18,646
13,429
Financial instruments at fair value - non current portion
9
208
112
Capital lease obligations - non current portion
11
(a)
69
45
Income tax liabilities
8
2,595
—
Loan from affiliated party - non current portion
15
—
336
Commitments and contingent liabilities
12
Stockholders' equity
Common stock par value $0.003 per share
- authorized shares - 23,333,334
- issued shares: 2014 and 2015 - 5,577,639,
- outstanding shares: 2014 and 2015 - 5,246,903
17
17
Additional paid-in capital
21,765
21,765
Treasury stock at cost: 2014 and 2015 - 330,736 shares
(1,462
)
(1,462
)
Accumulated deficit
(12,809
)
(11,699
)
Accumulated other comprehensive income
3,111
3,234
10,622
11,855
Total liabilities and stockholders' equity
32,140
25,777
See notes to these consolidated financial
statements
-F-2-
Bonso Electronics International Inc.
Consolidated Statements of Operations
and Comprehensive (Loss) / Income
(Expressed in United States Dollars)
Years ended March 31,
Note
2013
(A)
2014
(A)
2015
$ in thousands
$ in thousands
$ in thousands
Net sales
19
30,386
31,305
28,944
Cost of sales
(25,263
)
(28,631
)
(23,092
)
Gross profit
5,123
2,674
5,852
Rental income
45
708
1,453
Selling expenses
(268
)
(389
)
(822
)
Salaries and related costs
(2,627
)
(2,983
)
(3,166
)
Research and development expenses
(396
)
(366
)
(228
)
Administration and general expenses
(2,402
)
(2,964
)
(3,245
)
Other income
120
20
520
Gain on disposal of property plant and equipment
2
3,595
98
(Loss) / income from operations
19
(403
)
295
462
Interest income
7
64
18
Interest expense
(68
)
(136
)
(273
)
Foreign exchange loss
(261
)
(444
)
(134
)
(Loss) / income before income taxes
(725
)
(221
)
73
Income tax (expense) / credit
8
(29
)
—
1,037
Net (loss) / income
(754
)
(221
)
1,110
Other comprehensive income, net of tax:
Foreign currency translation adjustments, net of tax
62
257
123
Comprehensive (loss) / income
(692
)
36
1,233
Net (loss) / earnings per share
18
- basic and diluted
(0.14
)
(0.04
)
0.21
Weighted average number of shares outstanding -
- basic and diluted
18
5,246,903
5,246,903
5,246,903
Note A: Certain accounts in the consolidated statements of operations and comprehensive (loss) / income for the fiscal years ended March 31, 2013 and 2014 have been reclassified to conform with the presentation of that of the fiscal year ended March 31, 2015.
See notes to these consolidated financial
statements
-F-3-
Bonso Electronics International Inc.
Consolidated Statements of Changes in
Stockholders' Equity
(Expressed in United States Dollars)
Common stock
Treasury stock
Stock
Issued
Amount
outstanding
Additional
paid-in
capital
Treasury
Shares
held
Amount
outstanding
Accumulated
deficit
Accumulated
other
comprehensive
income-foreign
currency
adjustments
Total
stockholders'
equity
$ in thousands
$ in thousands
$ in thousands
$ in thousands
$ in thousands
$ in thousands
Balance, April 1, 2012
5,577,639
17
21,765
330,736
(1,462
)
(11,834
)
2,792
11,278
Net loss
—
—
—
—
—
(754
)
—
(754
)
Foreign exchange translation adjustment
—
—
—
—
—
—
62
62
Balance, March 31, 2013
5,577,639
17
21,765
330,736
(1,462
)
(12,588
)
2,854
10,586
Net loss
—
—
—
—
—
(221
)
—
(221
)
Foreign exchange translation adjustment
—
—
—
—
—
—
257
257
Balance, March 31, 2014
5,577,639
17
21,765
330,736
(1,462
)
(12,809
)
3,111
10,622
Net income
—
—
—
—
—
1,110
—
1,110
Foreign exchange translation adjustment
—
—
—
—
—
—
123
123
Balance, March 31, 2015
5,577,639
17
21,765
330,736
(1,462
)
(11,699
)
3,234
11,855
See notes to these consolidated financial
statements
-F-4-
Bonso Electronics International Inc.
Consolidated Statements of Cash Flows
(Expressed in United States Dollars)
Years Ended March 31,
2013
(A)
2014
(A)
2015
$ in thousands
$ in thousands
$ in thousands
Cash flows from operating activities
Net (loss) / income
(754
)
(221
)
1,110
Adjustments to reconcile net (loss) / income to net cash provided by operating activities:
Depreciation
120
1,086
1,082
Amortization
226
289
294
Gain on disposal of property, plant and equipment
(2
)
(3,595
)
(98
)
Write-down of inventories
—
874
687
Write off of property, plant and equipment
—
1,511
192
Change in cash surrender value of life insurance contract
(5
)
(4
)
(5
)
Change in fair value of financial instruments
(35
)
419
(132
)
Changes in assets and liabilities:
Trade receivables
(678
)
279
1,174
Other receivables, deposits and prepayments
(792
)
(166
)
380
Receivable from affiliated party
—
(166
)
—
Repayment from affiliated party
—
—
166
Inventories
(1,355
)
(2,959
)
3,737
Income tax recoverable
(22
)
—
—
Accounts payable
2,761
2,620
(5,622
)
Accrued charges and deposits
(18
)
268
520
Payable to affiliated parties
—
10
56
Income tax liabilities
(37
)
—
(894
)
Deferred income tax liabilities
(2
)
—
—
Net cash (used in) / provided by operating activities
(593
)
245
2,647
Cash flows from investing activities
Proceeds from disposal of property, plant and equipment
2
40
314
Acquisition of property, plant and equipment
(1,412
)
(2,778
)
(1,105
)
Acquisition of intangible assets
(802
)
—
—
Acquisition of financial instruments at fair value
—
—
(390
)
Acquisition of fixed deposits
(1,014
)
(1,049
)
—
Proceeds from maturity of fixed deposits
—
1,014
1,049
Net cash used in investing activities
(3,226
)
(2,773
)
(132
)
Cash flows from financing activities
Capital lease payments
—
(28
)
(24
)
Advance from notes payable
6,467
7,313
6,275
Repayment of notes payable
(6,061
)
(7,062
)
(6,972
)
Advance from bank overdrafts
180
630
—
Repayment of bank overdrafts
—
(180
)
(630
)
Advance from bank loans
1,357
963
2,927
Repayment of bank loans
—
—
(1,871
)
Net advance from loan from affiliated party
—
—
471
Net cash provided by financing activities
1,943
1,636
176
Net (decrease) / increase in cash and cash equivalents
(1,876
)
(892
)
2,691
Effect of exchange rate changes on cash and cash equivalents
2
(132
)
220
Cash and cash equivalents, beginning of year
3,014
1,140
116
Cash and cash equivalents, end of year
1,140
116
3,027
Supplemental disclosure of cash flow information
Cash paid during the year for:
Interest
68
136
273
Income tax
90
—
13
Income tax refund received
—
—
165
Non-cash investing activities:
Property plant and equipment acquired under capital lease
—
120
—
Note A: Certain figures
in the consolidated statements of cash flows of the years ended March 31, 2013 and 2014 have been reclassified to conform
with the presentation of that of March 31, 2015.
-F-5-
Bonso Electronics International Inc.
Notes to Consolidated Financial Statements
(Expressed in United States Dollars)
1
Description of business and significant accounting policies
Bonso Electronics International Inc. and its subsidiaries (collectively, the "Company"
or "Group") are engaged in the designing, manufacturing and selling of a comprehensive line of electronic scales and
weighing instruments, pet electronics products and other products.
The consolidated financial statements have been prepared in United States dollars and in accordance
with generally accepted accounting principles in the United States of America. The preparation of consolidated financial statements
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the dates of the consolidated financial statements and the reported amounts of revenues
and expenses during the reporting periods. Significant estimates made by management include valuation of inventories, allowance
for trade receivables and the impairment of long-lived assets. Actual results could differ from those estimates.
The Company sustained an operating
loss in the fiscal year ended March 31, 2013, and operating income of approximately $295,000 and $462,000 in the fiscal years ended
March 31, 2014, and 2015, respectively. Notwithstanding the operating losses sustained in the fiscal year ended March 31, 2013
and the negative working capital as of March 31, 2014 and 2015, the accompanying consolidated financial statements have been prepared
on a going concern basis. With the unutilized banking facilities of approximately $4,232,000 (refer to note 7) available as of
March, 31, 2015 and the increase of gross profit from 8.5% during the fiscal year ended March 31, 2014 to 20.2% during the fiscal
year ended March 31, 2015, management believes the Company will have sufficient working capital to meet its financing requirements
based upon their experience and their assessment of the Company's projected performance, credit facilities and banking relationships.
The significant accounting policies
are as follows:
(a)
Principles of consolidation
The consolidated financial statements include the financial statements of the Company and its subsidiaries
after elimination of inter-company accounts and transactions.
Acquisitions of companies have been consolidated from the date on which control of the net assets
and operations was transferred to the Company.
Acquisitions of companies are accounted for using the purchase method of accounting.
(b)
Cash and cash equivalents
Cash and cash equivalents are short-term, highly liquid investments with original maturities of
three months or less. Cash equivalents are stated at cost, which approximates fair value because of the short-term maturity of
these instruments.
-F-6-
Bonso Electronics International Inc.
Notes to Consolidated Financial Statements
(Expressed in United States Dollars)
1
Description of business and significant accounting policies (Continued)
(c)
Inventories
Inventories are stated at the lower of cost, as determined on a first-in, first-out basis, or market.
Costs of inventories include purchase and related costs incurred in bringing the products to their present location and condition.
Market value is determined by reference to the selling price after the balance sheet date or to management estimates based on prevailing
market conditions. The Company routinely reviews its inventories for their salability and for indications of obsolescence to determine
if inventory carrying values are higher than market value. Some of the significant factors the Company considers in estimating
the market value of its inventories include the likelihood of changes in market and customer demand and expected changes in market
prices for its inventories.
(d)
Trade receivables
Trade receivables are recorded
at the invoiced amount, net of allowances for doubtful accounts and sales returns. The allowance for doubtful accounts is the Company's
best estimate of the amount of probable credit losses in the Company's existing trade receivables. Bad debt expense is included
in the administrative and general expenses.
The Company recognizes an allowance
for doubtful receivables to ensure accounts and other receivables are not overstated due to uncollectibility. Allowance for doubtful
receivables is maintained for all customers based on a variety of factors, including the length of time the receivables are past
due, significant one-time events and historical experience. An additional allowance for individual accounts is recorded when the
Company becomes aware of customers' or other debtors' inability to meet their financial obligations, such as bankruptcy
filings or deterioration in the customer's or other debtor's operating results or financial position. If circumstances
related to customers or debtors change, estimates of the recoverability of receivables will be further adjusted.
(e)
Income taxes and deferred income taxes
Amounts in the consolidated financial
statements related to income taxes are calculated using the principles of Accounting Standards Codification ("ASC")
740 and Accounting Standards Updates ("ASU") 2013-11
"Presentation of an Unrecognized Tax Benefit When a Net
Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists"
. ASC 740 requires recognition of
deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial
statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the temporary differences
between the financial reporting bases and tax bases of assets and liabilities using enacted tax rates in effect for the year in
which the differences are expected to reverse. Future tax benefits, such as net operating loss carry forwards, are recognized as
deferred tax assets. Recognized deferred tax assets are reduced by a valuation allowance if, based on the weight of available evidence,
it is more likely than not that some portion or all of the deferred tax assets will not be realized.
The Company complies with ASC 740
"Income Taxes"
for uncertainty in income taxes recognized in financial statements.
ASC 740 prescribes a recognition threshold and measurement attributes for the financial statement recognition and measurement
of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification,
interest and penalties, accounting in interim periods, disclosure and transition. The Company's accounting policy is to
treat interest and penalties as components of income taxes.
-F-7-
Bonso Electronics International Inc.
Notes to Consolidated Financial Statements
(Expressed in United States Dollars)
1
Description of business and significant accounting policies (Continued)
(f)
Lease prepayments and intangible assets
Lease prepayments represent the cost
of land use rights in the People's Republic of China ("PRC"). Land use rights held by the Company are included
in intangible assets. The granted useful life of the land use rights is 50 years. They are stated at cost and amortized on a straight-line
basis over the period of a maximum of 30 years, in accordance with the business licenses of 30 years.
(g)
Property, plant and equipment
(i)
Property,
plant and equipment are stated at cost less accumulated depreciation. Leasehold land and buildings are depreciated on a straight-line
basis over 15 to 50 years, representing the shorter of the remaining term of the lease or the expected useful life to the Company.
(ii)
Other
categories of property, plant and equipment are carried at cost and depreciated using the straight-line method over their expected
useful lives to the Company. The principal Oestimated useful lives for depreciation are:
Plant and machinery
- 10 years
Furniture, fixtures
and equipment
- 5 to 10 years
Motor vehicles
- 5 years
(iii)
Assets
under construction are not depreciated until construction is completed and the assets are ready for their intended use.
(iv)
The cost
of major improvements and betterments is capitalized, whereas the cost of maintenance and repairs is expensed in the year when
they are incurred.
(v)
Any gain
or loss on disposal is included in the consolidated statements of operations and comprehensive (loss) / income.
-F-8-
Bonso Electronics International Inc.
Notes to Consolidated Financial Statements
(Expressed in United States Dollars)
1
Description of business and significant accounting policies (Continued)
(h)
Impairment of long-lived assets including intangible assets
Long-lived assets held and used by
the Company and intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount of such assets may not be recoverable. The Company evaluates recoverability of assets to be held and used by comparing the
carrying amount of an asset to future net undiscounted cash flows to be generated by the asset. If such assets are considered to
be impaired, the impairment loss is measured by the amount by which the carrying amount of the assets exceeds the fair value of
the assets calculated using a discounted future cash flows analysis. Provisions for impairment made on other long-lived assets
are disclosed in the consolidated statements of operations and comprehensive (loss) / income. Since the fiscal year ended March
31, 2014, the Company has transferred all its production process to the factory in Xinxing, PRC, and the factory in Shenzhen was
leased out to a third party. As a result, the Company performed an assessment of the value of the land, buildings and intangible
assets of the factories in Shenzhen and Xinxing, PRC, and no provision for impairment was made by the Company (2014: $nil; 2013:
$nil) based on the assessment.
(i)
Capital and operating leases
Costs in respect of operating leases
are charged against income on a straight-line basis over the lease term. Leasing agreements, which transfer to the Company substantially
all the benefits and risks of ownership of an asset, are treated as if the asset had been purchased outright. The assets are included
in property, plant and equipment ("capital leases") and the capital element of the lease commitments is shown as an
obligation under capital leases. The lease rentals are treated as consisting of capital and interest elements. The capital element
is applied to reduce the outstanding obligation and the interest element is charged against profit so as to give a consistent periodic
rate of charge on the remaining balance outstanding at the end of each accounting period. Assets held under capital leases are
depreciated over the useful lives of the equivalent owned assets or the lease term, whichever is shorter.
(j)
Revenue recognition
No revenue is recognized unless there
is persuasive evidence of an arrangement, the price to the buyer is fixed or determinable, delivery has occurred and collectibility
of the sales price is reasonably assured. Revenue is recognized when title and risk of loss are transferred to customers, which
is generally the point at which products are leaving the ports of Hong Kong, or Shenzhen or Nansha (Guangzhou) as designated by
our customers.  Shipping costs billed to the Company's customers are included within revenue. Associated costs are classified
as part of cost of sales.
The Company provides to certain customers
an additional one to two percent of the quantity of certain products ordered in lieu of a warranty, which is recognized as cost
of sales when these products are shipped to customers from the Company's facilities. In addition, certain products sold by
the Company are subject to a limited product quality warranty. The Company accrues for estimated incurred but unidentified quality
issues based upon historical activity and known quality issues if a loss is probable and can be reasonably estimated. During the
fiscal year ended March 31, 2015, the Company recorded $nil for such accrual (2014: $nil, 2013: $nil). The standard limited warranty
period is one to three years. Quality returns, refunds, rebates and discounts are recorded net of sales at the time of sale and
estimated based on past history. All sales are based upon firm orders with fixed terms and conditions, which generally cannot be
modified. Historically, the Company has not experienced material differences between its estimated amounts of quality returns,
refunds, rebates and discounts and the actual results. In all contracts, there is no price protection or similar privilege in relation
to the sale of goods.
Rental income is recognized according
to the rental agreements. Rental income for non-uniform rent payments is recognized on a straight-line basis throughout the lease
term.
-F-9-
Bonso Electronics International Inc.
Notes to Consolidated Financial Statements
(Expressed in United States Dollars)
1
Description of business and significant accounting policies
(Continued)
(k)
Research and development costs
Research and development costs include
salaries, utilities and contractor fees that are directly attributable to the conduct of research and development progress primarily
related to the development of new design of products. Research and development costs are expensed in the financial period in which
they are incurred.
(l)
Advertising
Advertising costs are expensed as incurred and are included within selling expenses. Advertising
costs were approximately $26,000, $16,000 and $9,000 for the fiscal years ended March 31, 2013, 2014 and 2015, respectively.
(m)
Foreign currency translations
(i)
The Company's
functional currency is the United States dollar. The financial statements of foreign subsidiaries where the United States dollar
is the functional currency and which have transactions denominated in non-United States dollar currencies are translated into United
States dollars at the exchange rates existing on that date. The translation of local currencies into United States dollars creates
transaction adjustments which are included in net (loss) / income. Exchange differences are recorded in the statements of operations
and comprehensive (loss) / income
(ii)
The financial statements of foreign subsidiaries, where non-United States dollar currencies are
the functional currencies, are translated into United States dollars using exchange rates in effect at period end for assets and
liabilities and average exchange rates during each reporting period for statement of operations. Adjustments resulting from translation
of these financial statements are reflected as a separate component of stockholders' equity in accumulated other comprehensive
income.
(n)
Stock options and warrants
Stock options have been granted to
employees, directors and non-employee directors. Upon exercise of the options, a holder can acquire shares of common stock of the
Company at an exercise price determined by the board of directors. The options are exercisable based on the vesting terms stipulated
in the option agreements or plan.
The Company follows the guidance of
ASC 718, "
Accounting for Stock Options and Other Stock-Based Compensation.
" ASC 718 requires companies to record
compensation expense for share-based awards issued to employees and directors in exchange for services provided. The amount of
the compensation expense is based on the estimated fair value of the awards on their grant dates and is recognized over the required
service periods. Our share-based awards include stock options and restricted stock awards. The estimated fair value underlying
our calculation of compensation expense for stock options is based on the Black-Scholes pricing model. Forfeitures of share-based
awards are estimated at the time of grant and revised, if necessary, in subsequent periods if our estimates change based on the
actual amount of forfeitures we have experienced.
-F-10-
Bonso Electronics International Inc.
Notes to Consolidated Financial Statements
(Expressed in United States Dollars)
1
Description of business and significant accounting policies
(Continued)
(o)
Recent accounting pronouncements
In April 2014, the Financial Accounting
Standards Board ("FASB") issued ASU 2014-08, "
Presentation of Financial Statements (Topic 205) and Property,
Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity
"
("ASU 2014-08"). ASU 2014-08 amends the definition of a discontinued operation and requires entities to provide additional
disclosures for both discontinued operations and disposal transactions that do not meet the discontinued-operations criteria. It
is effective for annual periods beginning on or after December 15, 2014. We do not expect the adoption of this guidance to have
a material effect on our consolidated financial statements.
In May 2014, the FASB issued ASU 2014-09,
"Revenue from Contracts with Customers"
("ASU 2014-09"). The objective of this Update is to remove
inconsistencies and weaknesses in revenue requirements, and to simplify the preparation of financial statements by reducing the
number requirements to which an entity must refer. The new standard supersedes virtually all present U.S. GAAP guidance on revenue
recognition and requires the use of more estimates and judgments than the present standards, as well as additional disclosures.
The FASB has voted to approve a one-year deferral of the effective date from January 1, 2017 to January 1, 2018, while allowing
for early adoption as of January 1, 2017. The Company is currently evaluating the impact this Update will have on its consolidated
financial statements.
In June 2014, the FASB issued ASU 2014-12,
"Compensation – Stock Compensation (Topic 718): Accounting for Share-Based
Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period"
("ASU 2014-12"). The amendments in ASU 2014-12 require that a performance target that affects vesting and that could
be achieved after the requisite service period be treated as a performance condition. The amendments in this ASU are effective
for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period, with early
application permitted. Companies may use either a prospective or a retrospective approach to adopt this ASU and the Company is
currently evaluating which transition approach to use. The Company is evaluating the new pronouncement to determine the impact
it may have to its consolidated financial statements.
In August 2014, the FASB issued ASU
2014-15, "
Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern"
, which
provides guidance on determining when and how to disclose going-concern uncertainties in the financial statements. The new standard
requires management to perform interim and annual assessments of an entity's ability to continue as a going concern within
one year of the date the financial statements are issued. An entity must provide certain disclosures if conditions or events raise
substantial doubt about the entity's ability to continue as a going concern. The ASU applies to all entities and is effective
for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. The Company is
currently evaluating the impact this Update will have on its consolidated financial statements.
In January 2015, the FASB issued ASU 2015-01,
"Income Statement – Extraordinary and Unusual Items (Subtopic 225-20):
Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items"
("ASU 2015-01").
The amendments in ASU 2015-01 eliminate from U.S. GAAP the concept of extraordinary items. The amendments in this ASU are effective
for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period, with early
application permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. Companies may use
either a prospective or a retrospective approach to adopt this ASU and the Company is currently evaluating which transition approach
to use. The adoption of ASU 2015-01 is not expected to have a material impact on the Company's consolidated financial statements.
-F-11-
Bonso Electronics International Inc.
Notes to Consolidated Financial Statements
(Expressed in United States Dollars)
1
Description of business and significant accounting policies
(Continued)
(o)
Recent accounting pronouncements (Continued)
In February 2015, the FASB issued ASU 2015-02,
"Consolidation (Topic 810): Amendments to the Consolidation Analysis"
("ASU 2015-02"). The amendments in ASU 2015-02 change the analysis that a reporting entity must perform to determine
whether it should consolidate certain types of legal entities. The amendments in this ASU are effective for public business entities
for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is permitted,
including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should
be reflected as of the beginning of the fiscal year that includes that interim period. A reporting entity may apply the amendments
in this ASU using a modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning of
the fiscal year of adoption. A reporting entity also may apply the amendments retrospectively. The adoption of ASU 2015-02 is not
expected to have a material impact on the Company's consolidated financial statements.
In April 2015, the FASB issued ASU
2015-03,
"Simplifying the Presentation of Debt Issuance Costs,"
("ASU 2015-03") which changes the
presentation of debt issuance costs in financial statements. ASU 2015-03 requires an entity to present such costs in the balance
sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs will continue to
be reported as interest expense. The guidance is effective for fiscal years beginning after December 15, 2015, with early adoption
permitted. The adoption of ASU 2015-03 is not expected to have a material impact on the Company's consolidated financial
statements or disclosures.
In April 2015, the FASB issued ASU 2015-05, "
Customer's Accounting for Fees Paid in a Cloud Computing Arrangement
"
("ASU 2015-05") (an update to Subtopic 350-40, Intangibles - Goodwill and Other - Internal-Use Software), which provides
guidance on accounting for cloud computing fees. If a cloud computing arrangement includes a software license, then the customer
should account for the license element of the arrangement consistent with the acquisition of other software licenses. If a cloud
computing arrangement does not include a software license, the arrangement should be accounted for as a service contract. This
ASU is effective for arrangements entered into, or materially modified, in interim and annual periods beginning after December
15, 2015. Retrospective application is permitted but not required. The adoption of ASU 2015-05 is not expected to have a material
impact on the Company's consolidated financial statements or disclosures.
In May 2015, the FASB issued ASU 2015-07,
"Fair Value Measurement: Disclosures for Investments in Certain Entities That
Calculate Net Asset Value per Share (or Its Equivalent)"
("ASU 2015-07"), which removes the requirement
to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share
practical expedient. The ASU also removes the requirement to make certain disclosures for all investments that are eligible to
be measured at fair value using the net asset value per share practical expedient. Rather, those disclosures are limited to investments
for which the entity has elected to measure the fair value using that practical expedient. This ASU is effective for arrangements
entered into, or materially modified, in interim and annual periods beginning after December 15, 2015. Retrospective application
is permitted but not required. The Company is currently evaluating the impact of this ASU on the consolidated financial statements.
We believe there is no additional new accounting guidance adopted, but not yet effective that is relevant to the readers of our
financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant
impact on our financial reporting.
-F-12-
Bonso Electronics International Inc.
Notes to Consolidated Financial Statements
(Expressed in United States Dollars)
2
Allowance for doubtful accounts
Allowance for doubtful accounts amounted
to $1,415,000 as of March 31, 2014 and 2015. The Company believed that the recoverability was doubtful, and continued to include
this amount in allowance for doubtful accounts as of March 31, 2014 and 2015.
Most of the Company's trade
receivables are generally unsecured, except for two customers with receivables covered by credit insurance under a factoring agreement.
3
Inventories
The components of inventories as of March 31, 2014 and 2015 are as follows:
2014
2015
$ in thousands
$ in thousands
Raw materials
5,137
1,978
Work in progress
2,229
676
Finished goods
179
467
7,545
3,121
During the fiscal year ended March
31, 2014 and 2015, based upon material composition and expected usage, provision for inventories of approximately $874,000 and
$687,000, respectively, were charged to the consolidated statements of operations under cost of sales.
-F-13-
Bonso Electronics International Inc.
Notes to Consolidated Financial Statements
(Expressed in United States Dollars)
4
Property, plant and equipment, net
During the fiscal years ended March
31, 2013, 2014 and 2015, depreciation expenses charged to the consolidated statements of operations amounted to approximately $120,000,
$1,086,000 and $1,082,000 respectively. As at March 31, 2014 and 2015, fully depreciated assets that were still in use by the Company
amounted to $10,122,000 and $9,550,000, respectively.
Property, plant and equipment in Shenzhen
and Xinxing were assessed for impairment according to the policy described in note 1(h). The Company concluded that no impairment
to property, plant and equipment in Shenzhen and Xinxing were required for the fiscal years ended March 31, 2014 and 2015.
5
Interests in subsidiaries
Particulars of principal subsidiaries as of March 31, 2014
and 2015 are as follows:
Name of company
Place
                                         of
incorpration and
kind of
legal entity
Particulars of issued capital
registered
                                                                                                                                                                                                                                        capital
Percentage of capital
held by the Company
Principal activities
2014
2015
Bonso Electronics Limited *
("BEL")
Hong Kong,
limited liability company
HK$5,000,000 (US$641,026)
100%
100%
Investment holding, providing management and administrative support to the Group companies
Bonso Investment Limited
("BIL")
Hong Kong,
limited liability company
HK$3,000,000 (US$384,615)
100%
100%
Investment holding
Bonso Electronics (Shenzhen) Company, Limited
("BESCL")
PRC,
limited liability company
US$12,621,222
100%
100%
Investment holding
Bonso Advanced Technology Limited *
("BATL")
Hong Kong,
limited liability company
HK$1,000,000
(US$128,205)
100%
100%
Investment holding, and trading of scales and pet electronics products
Bonso Advanced Technology (Xinxing) Company, Limited
("BATXXCL")
PRC,
limited liability company
US$10,000,000
100%
100%
Production of scales and pet electronics products
Bonso Technology (Shenzhen) Company, Limited
("BTL")
PRC,
limited liability company
HK$200,000
100%
100%
Product development
Xinxing An Bang Metal and Plastic Manufacturing Company Limited
("ANB")
PRC,
limited liability company
HK$500,000
100%
100%
Employs workers for assembly of scales and pet electronics products
* Shares directly held by the Company
-F-14-
Bonso Electronics International Inc.
Notes to Consolidated Financial Statements
(Expressed in United States Dollars)
6
Intangible assets
Intangible assets are analyzed as follows:
March 31,
2014
2015
$ in thousands
$ in thousands
Cost
6,894
6,939
Less: accumulated amortization
(2,507
)
(2,820
)
4,387
4,119
The components of other intangible
assets are as follows:
March 31,
2014
2015
$ in thousands
$ in thousands
Land
    use right of factory land in Shenzhen, Guangdong, PRC
2,062
1,880
Land
    use right of factory land in Xinxing, Guangdong, PRC
2,325
2,239
4,387
4,119
Amortization
expense in relation to other intangible assets was approximately $226,000, $289,000 and $294,000 for each of the fiscal years
ended March 31, 2013, 2014 and 2015, respectively.
As
of March 31, 2015, future minimum amortization expenses in respect of other intangible assets are as follows:
Year ending March 31,
$
in thousands
2016
294
2017
294
2018
294
2019
294
2020
294
Thereafter
2,649
Total
4,119
-F-15-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
7
Banking
                                         facilities
As of March 31, 2015, the Company
                              had general banking facilities for bank overdrafts, letters of credit, notes payable, factoring
                              and term loans. The facilities are interchangeable with total amounts available of $9,438,000 (2014:
                              $10,698,000). The general banking facilities utilized by the Company are denominated in United States
                              dollars, Hong Kong dollars and Chinese Yuan.
The Company's general banking facilities, expressed
               in United States dollars, are further detailed as follows:
Amount
    available
Amount
    utilized
Amount
    unutilized
Terms
    of banking
facilities as of
March 31,
March 31,
March 31,
March 31, 2015
2014
2015
2014
2015
2014
2015
Interest
Repayment
$ in thousands
$ in thousands
$ in thousands
rate
terms
Import
    and export  facilities
Combined
    limit
6,154
2,564
3,703
1,830
2,451
734
Including
    sub-limit of:
Notes
    payable
4,487
2,308
2,527
1,830
1,960
478
HIBOR*
    +2.5%
Repayable
    in full within 120 days
Bank overdrafts
641
641
630
—
11
641
Prime rate
+ 1%
Repayable
    on demand
Factoring
2,400
2,400
546
—
1,854
2,400
HIBOR*
    +1.5%
Repayable
    in 60 days
Other
    facilities
Export Documentary
    Credits
1,923
641
—
—
1,923
641
Short Term
Loans
1,026
3,547
1,026
1,026
—
2,521
(Note
    A)
Revolving loan  repayable in 30 days
Long
    Term Loans
(1)
1,595
2,686
748
2,350
847
336
(Note
    A)
Term
    loans are repayable
monthly over  3-years
10,698
9,438
5,477
5,206
5,221
4,232
Note
A: HIBOR* +2.25% for loans in Hong Kong. People's Bank of China's loan benchmark interest rate times 110% for loans in PRC.
(1)
A clause in the banking facilities states that the term loans are subject to review any time and also subject to the bank's overriding
right of repayment on demand, including the right to call for cash cover on demand for prospective and contingent liabilities.
Therefore, all long-term loans were classified as current liabilities in the consolidated balance sheets.
* HIBOR
is the Hong Kong Interbank Offer Rate
-F-16-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
7
Banking
                                         facilities (continued)
As
of March 31, 2015, a treasury product facility of approximately $25,738,000 (2014: $25,738,000) was made available to the Company
for transactions of financial instruments including forward contracts, and approximately $2,000,000 (2014: $2,000,000) of the
facility was utilized.
One
of the properties of the Company located in Hong Kong with net book value of approximately $990,000 and the rental assignment
over such property, the rights, interests and benefits of a life insurance contract with book value of approximately $136,000,
and a land use right and factory building located in Xinxing, PRC with net book value of approximately $3,550,000 are arranged
as securities to the banks for the banking facilities arrangement. Refer to note 20 on subsequent events for sale of land use
right after March 31, 2015 and potential impact to the banking facilities.
The
Prime Rate, HIBOR and Peoples' Bank of China loan benchmark interest rate were 5.00%, 0.53% and 5.75% per annum, respectively,
as of March 31, 2015. The Prime Rate is determined by the Hong Kong Bankers Association and is subject to revision from time to
time. Interest rates are subject to change if the Company defaults on the amount due under the facility or draws in excess of
the facility amounts, or at the discretion of the banks.
The
weighted average interest rates of borrowings of the Company are as follows:
During the fiscal year ended March 31,
2014
2015
Bank overdrafts
6.00
%
6.00
%
Notes payable
2.96
%
2.92
%
Term Loan in Hong Kong
2.47
%
2.47
%
Term Loan in PRC
—
6.77
%
Factoring
1.96
%
1.74
%
-F-17-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
8
Income
                                         tax
(a)
The subsidiaries
                                         comprising the Group are subject to tax on an entity basis on income arising in or derived
                                         from Hong Kong and the PRC. The Company is not subject to income taxes in the British
                                         Virgin Islands.
Hong Kong
Tax
The
subsidiaries operating in Hong Kong are subject to the Hong Kong profits tax rate of 16.5% (2014: 16.5%). BIL has no assessable
profits for the year ended March 31, 2015. Both BEL and BATL have assessable profits for the year ended March 31, 2015 and will
be offset against prior year tax losses. Therefore, no current year provision for taxation has been made for the year ended March
31, 2015 (2014: $nil).
Since
December 2005, BEL was under tax review by the local tax authorities for the profits tax assessment for the fiscal years ended
March 31, 2000 to 2005. During the tax years under review, BEL was reporting profits tax with tax benefit of 50% reduction in
tax payment due to import processing. However, the local tax authorities later believed that BEL was not entitled to this tax
benefit as the PRC factory setup was no longer considered an import processing. Also, during the tax years under review, the local
tax authorities believed that some profits of BEII were generated within the territory of Hong Kong and should be taxable in Hong
Kong. After review and discussion between the Company and the local tax authorities, both parties agreed that the tax benefit
of 50% reduction was not applicable and certain profits of BEII were taxable in Hong Kong during the tax years in review.
During
the fiscal year ended March 31, 2015, the tax review case was closed and confirmed with the local tax authorities and the final
tax and interest payable were approximately $1,545,000. After offsetting with the tax reserve certificates purchased for approximately
$1,710,000, the Company obtained a refund of approximately $165,000.
PRC
Tax
All
subsidiaries registered in the PRC are subject to a tax rate of 25% (2014: 25%).
-F-18-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
8
Income
                                         tax (continued)
(b)
Income
                                         is subject to taxation in the various countries in which the Company and its subsidiaries
                                         operate. The (loss) / income before income taxes by geographical location is analyzed
                                         as follows:
2013
2014
2015
$ in
                                         thousands
$ in
                                         thousands
$ in
                                         thousands
Hong Kong
(3,509
)
(1,495
)
(55
)
PRC
2,832
1,337
148
Others
(48
)
(63
)
(20
)
Total
(725
)
(221
)
73
Others mainly
                                         include the (loss) / income from BVI.
(c)
Income
                                         tax (expense) / credit comprises the following:
2013
2014
2015
$ in
                                         thousands
$ in
                                         thousands
$ in
                                         thousands
Deferred
    income tax
2
—
—
Current income tax
    expense
(31
)
—
(13
)
Income
    tax credit
—
—
1,050
Total
    income tax (expense) / credit
(29
)
—
1,037
The components
                                         of the income tax (expense) / credit by geographical location are as follows:
2013
2014
2015
$ in
                                         thousands
$ in
                                         thousands
$ in
                                         thousands
Hong Kong
(29
)
—
1,050
PRC
—
—
(13
)
Others
—
—
—
Total
(29
)
—
1,037
At the end
                                         of the accounting period, the income tax liabilities are as follows:
2014
2015
$ in
                                         thousands
$ in
                                         thousands
Non-current
2,595
—
Current
7
7
Total
2,602
7
-F-19-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
8
Income
                                         tax (continued)
(d)
Deferred
                                         tax assets comprise the following:
2014
2015
$ in thousands
$ in thousands
Tax loss carry
    forwards
853
4,459
Less: Valuation allowance
(853
)
(4,459
)
—
—
As
of March 31, 2014 and 2015, the Company had accumulated tax losses amounting to approximately $3,600,000 and $25,327,000 (the
tax effect thereon is $853,000 and $4,459,000), respectively, subject to the final agreement by the relevant tax authorities,
which may be carried forward and applied to reduce future taxable income which is earned in or derived from Hong Kong and other
countries. Realization of deferred tax assets associated with tax loss carry forwards is dependent upon generating sufficient
taxable income prior to their expiration. A valuation allowance is established against such tax losses when management believes
it is more likely than not that a portion may not be utilized. As of March 31, 2015, the Company's accumulated tax losses
of $2,189,000 will expire in 2018, $164,000 will expire in 2019 and $951,000 will expire in 2020.
(e)
Changes
                                         in valuation allowance are as follows:
2013
2014
2015
$ in
                                         thousands
$ in
                                         thousands
$ in
                                         thousands
Balance, April 1
784
700
853
(Credited) / charged
    to income tax expense
(84
)
153
3,606
──────
──────
──────
Balance, March 31
700
853
4,459
══════
══════
══════
-F-20-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
8
Income
                                         tax (continued)
(f)
The actual
                                         income tax (expense) / credit attributable to earnings for the fiscal years ended March
                                         31, 2013, 2014 and 2015 differed from the amounts computed by applying the Hong Kong
                                         statutory tax rate in accordance with the relevant income tax law as a result of the
                                         following:
2013
2014
2015
$ in
                                         thousands
$ in
                                         thousands
$ in
                                         thousands
(Loss)
    / income before income taxes
(725
)
(221
)
73
Income tax benefit / (expense)
    on pretax income at statutory rate
120
36
(12
)
Effect of different tax rates of subsidiary
operating in other jurisdictions
(249
)
(28
)
(233
)
Profit not subject to income
    tax
3,600
1,129
542
Expenses not deductible for
    income tax purposes
(3,469
)
(1,137
)
(336
)
(Decrease) / increase in
    valuation allowance
(84
)
153
3,606
Reversal of provision
    from conclusion of tax review with tax authorities
—
—
2,595
Tax expense from conclusion
    of tax review with tax authorities
—
—
(1,545
)
Under provision of prior
    year
(31
)
—
—
Utilization
    of tax losses not previously recognized / (tax losses
not yet recognized)
84
(153
)
(3,580
)
Total
    income tax (expense) / credit
(29
)
—
1,037
The
statutory rate of 16.5% used above is that of Hong Kong, where the Company's main business is located.
(g)
The Company
                                         complies with ASC 740 and assessed the tax position during the fiscal year ended March
                                         31, 2015 and concluded that such prior year uncertain income tax liability was no longer
                                         required. Included in the total tax liabilities of $7,000 (2014: $2,602,000), the uncertain
                                         tax liabilities in respect of this for the year ended March 31, 2015 amounted to $nil
                                         (2014: $2,595,000).
The
Company's accounting policy is to treat interest and penalties as components of income taxes. As of March 31, 2015,
the Company had no accrued penalties related to uncertain tax positions (2014: $994,000).
-F-21-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
9
Financial
                                         instruments at fair value
The
Company complies with ASC 820, "
Fair Value Measurements
" ("ASC 820"). ASC 820 clarifies the definition
of fair value, prescribes methods for measuring fair value and establishes a fair value hierarchy to classify the inputs used
in measuring fair value as follows:
Level
1-Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.
Level
2-Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar
assets and liabilities in markets that are not active, inputs other than quoted prices that are observable and inputs derived
from or corroborated by observable market data.
Level
3-Inputs are unobservable inputs which reflect the reporting entity's own assumptions on what assumptions the market participants
would use in pricing the asset or liability based on the best available information.
The
Company entered into forward contracts with a bank, and the bank will pay the Company if the Chinese Yuan appreciates against
USD. If the Chinese Yuan depreciates against USD, the Company will need to pay the bank, but will be able to buy more Chinese
Yuan as a result.
During
the fiscal year ended March 31, 2015, based on our valuation of the existing forward contracts, we recorded a gain of approximately
$131,000 (2014: loss of $419,000) for the change in valuation, resulting in a liability of approximately $196,000 (2014: $327,000).
During
the fiscal year ended March 31, 2015, the Company purchased an investment product for approximately $390,000 through Ping An Bank
(2014: $nil), and the fair value at March 31, 2015 was valuated at approximately $391,000 (2014: $nil).
At
the end of the accounting period, the fair value of the following assets / (liabilities) were as follows:
March 31, 2014
March 31, 2015
$ in thousands
Level
                                         1
Level
                                         2
Level
                                         3
Total
Level
                                         1
Level
                                         2
Level
                                         3
Total
Forward
    contracts (1)
—
(327
)
—
(327
)
—
(196
)
—
(196
)
Investment product
    (2)
—
—
—
—
—
—
391
391
(1)
The fair
                                         value of forward contracts was determined based on the present value of expected future
                                         cash flows considering the risks involved, and using discount rates appropriate for the
                                         respective maturities. Observable level 2 inputs are used to determine the present value
                                         of expected future cash flows.
(2)
Observable
                                         inputs for the fair value of financial instruments were not assessable. The fair value
                                         is determined based on valuation and projection provided by Ping An Bank. On July 8,
                                         2015, the investment product has been redeemed for approximately $397,000 for a net gain
                                         of approximately $6,000.
-F-22-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
10
Investment
                                         in life insurance contract
Investment
in life insurance contract represents the carrying amount (surrender value) of the contract if it is to be terminated by the Company.
There is one life insurance contract as of March 31, 2015 and March 31, 2014, with carrying amount of approximately $136,000 and
$131,000, respectively. All premiums of this contract have already been paid during the fiscal year ended March 31, 2012. The
face amount (death benefit) of this contract is $1,000,000. During the fiscal year ended March 31, 2015, we recorded a gain of
approximately $5,000 for the change in valuation (2014: $4,000).
-F-23-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
11
Leases
(a)
Capital
                                         leases
During the
                                         year ended March 31, 2014, the Company entered into capital lease obligations amounting
                                         to approximately $123,000 for two motor vehicles. During the year ended March 31, 2015,
                                         the Company did not enter into additional capital lease obligations.
Future minimum
                                         payments under capital leases as of March 31, 2015 with an initial term of more than
                                         one year are as follows:
Future
                                         minimum payments under capital leases for the years ended March 31,
Principal
                                         repayment
$
                                         in thousands
Interest
                                         payment
$ in
                                         thousands
Total
                                         obligations
$ in thousands
2016
23
2
25
2017
23
1
24
2018
20
1
21
2019
2
0
2
68
4
72
-F-24-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
11
Leases
                                         (continued)
(b)
Operating
                                         leases
As of March
                                         31, 2015, the Company leases two properties, a factory in Shenzhen and part of production
                                         facilities in Xinxing under rental agreements to third parties. The Company will need
                                         to pay a cancellation fee of approximately $69,000 if the Company decides to terminate
                                         all the rental agreements before their expiry.
The
Shenzhen factory was rented out to a third party from August 1, 2013 to August 1, 2019. The metal stamping facilities in Xinxing
were rented out to a third party from July 1, 2013 to June 30, 2016. The plastic injection facilities in Xinxing were rented out
to a third party from January 1, 2015 to December 31, 2020. The expected future rental payments to be received are as follows:
Year ending March 31,
$ in
                                         thousands
2016
1,307
2017
1,341
2018
1,383
2019
1,383
2020
461
5,875
As
of March 31, 2015, the future minimum lease commitment payables in respect of non-cancellable operating leases for two offices
in Shenzhen and a staff quarter in Xinxing are as follows:
Year ending March 31,
$ in
                                         thousands
2016
119
2017
122
2018
107
2019
20
368
Rental expenses
                                         for all operating leases of two office premises in Shenzhen and a staff quarter in Xinxing
                                         amounted to approximately $nil, $51,000 and $100,000 for the fiscal years ended March
                                         31, 2013, 2014 and 2015, respectively.
-F-25-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
12	          Commitments
and contingent liabilities
(a)
Commitments
Capital
                                         expenditures contracted at the balance sheet date but not yet provided for are as follows:
March 31,
2014
2015
$ in thousands
$ in thousands
Construction
    in Xinxing, Guangdong, PRC
665
301
Leasehold
    improvement in Hong Kong
73
—
738
301
As
of March 31, 2015, the Company entered into contractor agreements to construct a factory building and leasehold improvements on
the manufacturing facility in Xinxing, the PRC for total consideration of $1,561,000. As of March 31, 2015, $1,260,000 has been
paid, and the remaining balance of $301,000 is to be paid in accordance with the progress of the construction.
(b)
Contingent
                                         liabilities
The
Company has entered into an employment agreement with a director, Anthony So. Mr. So's employment agreement provides for
a maximum yearly salary of approximately $800,000 per year plus bonus. The initial term of the employment agreement expired on
March 31, 2013 ("Initial Term"); however, the employment agreement has been renewed under a provision in the agreement
that provides for automatic renewal for successive one year periods, unless at least 90 days prior to the expiration of the Initial
Term or any renewal term, either party gives written notice to the other party specifically electing to terminate the agreement.
Mr. So's employment agreement contains a provision under which the Company will be obligated to pay Mr. So all compensation
for the remainder of his employment agreement and five times his annual salary and bonus compensation if a change of control,
as defined in his employment agreement occurs. The employment agreement was renewed automatically, and will expire on March 31,
2016, unless automatically renewed.
-F-26-
Bonso Electronics International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
13
Stockholders'
                                         equity
(a)
Repurchase of common stock
In
August of 2001, the Company's Board of Directors authorized a program for the Company to repurchase up to $500,000 of its common
stock. This repurchase program does not obligate the Company to acquire any specific number of shares or acquire shares over any
specified period of time. No stock had been repurchased when, on November 16, 2006, the Company's Board of Directors authorized
another $1,000,000 for the Company to repurchase its common stock under the same repurchase program. This authorization to repurchase
shares increased the amount authorized for repurchase from $500,000 to $1,500,000. The Board of Directors believed that the common
stock was undervalued and that the repurchase of common stock would be beneficial to the Company's stockholders. The Company (through
its subsidiary) has repurchased an aggregate of 330,736 shares of its common stock, including 70,019 ($134,000) shares that were
repurchased during the fiscal year ended March 31, 2009. No shares were repurchased during the three fiscal years ended March
31, 2013, 2014 and 2015. The Company may from time to time repurchase shares of its common stock under this program.
(b)
Preferred
                                         stock
The Company
                                         has authorized share capital of $100,000 for 10,000,000 shares of preferred stock, with
                                         par value of $0.01 each, divided into 2,500,000 shares each of class A preferred stock,
                                         class B preferred stock, class C preferred stock and class D preferred stock. Shares
                                         may be issued within each class from time to time by the Company's Board of Directors
                                         in its sole discretion without the approval of the stockholders, with such designations,
                                         power, preferences, rights, qualifications, limitation and restrictions as the Board
                                         of Directors shall fix and as have not been fixed in the Company's Memorandum of
                                         Association. The Company has not issued any shares of preferred stock as of March 31,
                                         2015.
(c)
Dividends
No
dividends were declared by the Company for each of the fiscal years ended March 31, 2013, 2014 and 2015, respectively.
-F-27-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
14
Stock
                                         option and bonus plans
(a)
1996
                                         Stock Option Plan
In October 1996, the Company's Board of Directors approved the 1996 Stock Option
                                         Plan and 1996 Non-Employee Directors' Stock Option Plan. Under the 1996 Stock Option
                                         Plan, the Company may grant options of common stock to certain employees and directors
                                         of the Company for a maximum of 900,000 shares. The 1996 Stock Option Plan is administered
                                         by a committee appointed by the Board of Directors which determines the terms of options
                                         granted, including the exercise price, the option periods and the number of shares to
                                         be subject to each option. The exercise price of options granted under the 1996 Stock
                                         Option Plan may be less than the fair market value of the common shares on the date of
                                         grant. The maximum term of options granted under the 1996 Stock Option Plan is 10 years.
                                         The right to acquire the common shares is not assignable except for certain conditions
                                         stipulated in the 1996 Stock Option Plan.
Under the
                                         1996 Non-Employee Directors' Stock Option Plan, the non-employee directors were
                                         automatically granted stock options on the third business day following the day of each
                                         annual general meeting of the Company to purchase shares of common stock. The maximum
                                         number of authorized shares under the 1996 Non-Employee Director's Stock Option
                                         Plan was 600,000. The exercise price of all options granted under the 1996 Non-Employee
                                         Directors' Stock Option Plan shall be one hundred percent of the fair market value
                                         per share of the common shares on the date of grant. The maximum term of options granted
                                         under the 1996 Non-Employee Directors' Stock Option Plan is 10 years. No stock
                                         option may be exercised during the first six months of its term except for certain conditions
                                         provided in the 1996 Non-Employee Directors' Stock Option Plan. The right to acquire
                                         the common shares is not assignable except for under certain conditions stipulated in
                                         the 1996 Non-Employee Directors' Stock Option Plan.
In April
                                         2003, the Company issued options to certain directors and non-employee directors of the
                                         Company to purchase an aggregate of 372,500 shares of common stock of the Company at
                                         an exercise price of $1.61. The exercise prices of these options were equal to the fair
                                         market value at the time of grant. The options expired on March 31, 2013. No such options
                                         have been exercised during the year ended March 31, 2013.
In March
                                         2004, the Company issued options to certain non-employee directors of the Company to
                                         purchase an aggregate of 40,000 shares of common stock of the Company at an exercise
                                         price of $6.12. The exercise prices of these options were equal to the fair market value
                                         at the time of grant. The options expired on March 25, 2014. No such options have been
                                         exercised up to March 31, 2014.
In September 2004, the Company issued options to certain non-employee directors of the
                                         Company to purchase an aggregate of 40,000 shares of common stock of the Company at an
                                         exercise price of $6.20. The exercise prices of these options were equal to the fair
                                         market value at the time of grant. The options expired on September 12, 2014. No such
                                         options have been exercised up to September 12, 2014.
In December
                                         2005, the Company issued options to certain non-employee directors of the Company to
                                         purchase an aggregate of 30,000 shares of common stock of the Company at an exercise
                                         price of $4.50. The options shall expire on December 4, 2015 and can be exercised at
                                         any time after granting. The exercise prices of these options were equal to the fair
                                         market value at the time of grant. No such options had been exercised during the years
                                         ended March 31, 2013, 2014 and 2015.
On November 16, 2006, the Board of Directors of the Company voted to rescind the Company's
                                         1996 Non-Employee Directors' Stock Option Plan (the "Non-Employee Directors'
                                         Plan"). All options previously granted under the Non-Employee Directors'
                                         Plan continue in full force and effect pursuant to their terms of grant.
During the
                                         fiscal years ended March 31, 2013, 2014 and 2015, no shares or share options were granted
                                         under the 1996 Stock Option Plan.
-F-28-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
14
Stock
                                         option and bonus plans (continued)
(b)
2004
                                         Stock Bonus Plan
On September 7, 2004, the Company's stockholders adopted the 2004 Stock Bonus Plan
                                         (the "Stock Bonus Plan") which authorizes the issuance of up to five hundred
                                         thousand (500,000) shares of the Company's common stock in the form of stock bonus.
The
purpose of this Stock Bonus Plan is to (i) induce key employees to remain in the employment of the Company or of any subsidiary
of the Company; (ii) encourage such employees to secure or increase their stock ownership in the Company; and (iii) reward employees,
non-employee directors, advisors and consultants for services rendered or to be rendered to or for the benefit of the Company
or any of its subsidiaries. The Company believes that the Stock Bonus Plan will promote continuity of management and increase
incentive and personal interest in the welfare of the Company.
The
Stock Bonus Plan shall be administered by a committee appointed by the Board of Directors which consists of at least two but not
more than three members of the Board, one of whom shall be a non-employee of the Company. The existing Committee members are Mr.
Anthony So and Mr. Woo Ping Fok. The Committee has the authority, in its sole discretion: (i) to determine the parties to receive
bonus stock, the times when they shall receive such awards, the number of shares to be issued and the time, terms and conditions
of the issuance of any such shares; (ii) to construe and interpret the terms of the Stock Bonus Plan; (iii) to establish, amend
and rescind rules and regulations for the administration of the Stock Bonus Plan; and (iv) to make all other determinations necessary
or advisable for administering the Stock Bonus Plan.
(c)
2004
                                         Stock Option Plan
On March 23, 2004, the Company's stockholders adopted the 2004 Stock Option Plan
                                         (the "2004 Plan") which provides for the grant of up to six hundred thousand
                                         (600,000) shares of the Company's common stock in the form of stock options, subject
                                         to certain adjustments as described in the Plan. At the Annual meeting of stockholders
                                         held on March 20, 2015, the stockholders approved an amendment to the 2004 Plan to increase
                                         the number of shares that could be granted from 600,000 to 850,000.
The
purpose of the 2004 Plan is to secure key employees to remain in the employment of the Company and to encourage such employees
to secure or increase on reasonable terms their common stock ownership in the Company. The Company believes that the 2004 Plan
promotes continuity of management and increased incentive and personal interest in the welfare of the Company.
The
2004 Plan is administered by a committee appointed by the Board of Directors which consists of at least two but not more than
three members of the Board, one of whom shall be a non-employee of the Company. The current committee members are Mr. Anthony
So and Mr. Woo Ping Fok. The committee determines the specific terms of the options granted, including the employees to be granted
options under the plan, the number of shares subject to each option grant, the exercise price of each option and the option period,
subject to the requirement that no option may be exercisable more than 10 years after the date of grant. The exercise price of
an option may be less than the fair market value of the underlying shares of Common Stock. No options granted under the plan will
be transferable by the optionee other than by will or the laws of descent and distribution, and each option will be exercisable
during the lifetime of the optionee only by the optionee.
The
exercise price of an option granted pursuant to the 2004 Plan may be paid in cash, by the surrender of options, in common stock,
in other property, including a promissory note from the optionee, or by a combination of the above, at the discretion of the Committee.
As of March 31, 2015, no options had been granted under the 2004 Plan. Refer to note 20 on subsequent events for options issuance
after March 31, 2015.
-F-29-
Bonso Electronics
International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
14
Stock
                                         option and bonus plans (continued)
(d)
The
                                         stock options summary as of March 31, 2015 is as follows:
Number
                                         of options
Weighted
                                         average exercise
price
Balance,
                                         March 31, 2013
110,000
$
5.71
Expired
(40,000
)
$
6.12
Balance,
                                         March 31, 2014
70,000
$
5.47
Expired
(40,000
)
$
6.20
Balance,
                                         March 31, 2015
30,000
$
4.50
-F-30-
Bonso
Electronics International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
14
Stock
                                         option and bonus plans (continued)
(e)
The following
                                         table summarizes information about all stock options of the Company outstanding as at
                                         March 31, 2015 :
Weighted
                                         average exercise price
Number
                                         outstanding at March 31, 2015
Weighted
                                         average
remaining
                                         life
(years)
Exercisable
shares at
March 31, 2015
$
4.50
30,000
0.8
30,000
The
intrinsic value of options outstanding and exercisable was $nil, $nil and $nil on March 31, 2013, 2014 and 2015, respectively.
The intrinsic value represents the pre-tax intrinsic value (the difference between the closing stock price of the Company's
common stock on the balance sheet date and the exercise price for both the outstanding and exercisable options) that would have
been received by the option holders if all options had been exercised on March 31, 2013, 2014 and 2015.
New
shares will be issued by the Company upon future exercise of stock options.
-F-31-
Bonso
Electronics International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
15
Related
                                         party transactions
(a)
The
                                         Company paid emoluments, commissions and/or consultancy fees to its directors and officers
                                         as follows:
Year
                                         ended
Mr. Anthony
Mr. Kim Wah
Mr. Woo-Ping
Mr.
                                         Andrew
March
                                         31,
So
Chung
Fok
So
Director, Chief Executive
Officer
Director
Director
Director and Chief Operating Officer
$ in thousands
$ in thousands
$ in thousands
$ in
                                         thousands
2013
$857 (i), (iii)
$160 (iii)
Nil
$
124
2014
$857 (i), (iii)
$161 (iii)
Nil
$
128
2015
$857 (i), (iii)
$160 (iii)
Nil
$
124
Mr. Henry
Mr. Albert
Schlueter
So
Director and
Assistant Secretary
Director, Chief Financial
Officer and
    Secretary
$ in thousands
$ in thousands
2013
$74 (ii)
$124 (iii)
2014
$84 (ii)
$125
2015
$55 (ii)
$109
The emoluments
                                         paid to the Company's directors and officers were included in the salaries and
                                         related costs, while the consultancy fees or professional fees paid to Schlueter &
                                         Associates, P.C., were included in the administration and general expenses.
(i)
Apart
                                         from the emoluments paid by the Company as shown above, one of the properties of the
                                         Company in Hong Kong is also provided to Mr. Anthony So for his accommodation.
(ii)
The
                                         amounts for the years ended March 31, 2013, 2014 and 2015 represented professional fees
                                         paid to Schlueter & Associates, P.C., the Company's SEC counsel, in which Mr.
                                         Henry Schlueter is one of the principals.
(iii)
The
                                         amount for the year ended March 31, 2013, included unpaid vacation payments of $57,000,
                                         $9,000, and $5,000 for Mr. Anthony So, Mr. Kim Wah Chung, and Mr. Albert So, respectively.
                                         The amount for the year ended March 31, 2014, included unpaid vacation payments of $10,000,
                                         for Mr. Kim Wah Chung. The amount for the year ended March 31, 2014 included vacation
                                         payment of $57,000 for Mr. Anthony So. The amount for the year ended March 31, 2015,
                                         included unpaid vacation payments of $57,000, $9,000 for Mr. Anthony So and Mr. Kim Wah
                                         Chung, respectively.
-F-32-
Bonso
Electronics International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
15
Related
                                         party transactions (continued)
During
the fiscal year ended March 31, 2014, the Company made a loan to a director, Mr. Anthony So, resulting in an amount due to the
Company from Mr. So of $166,000 on March 31, 2014. On August 7, 2014, Mr. So paid $166,000 to the Company to fully repay the amounts
loaned to him.
During the fiscal year ended March 31, 2015, one of the subsidiaries in Hong Kong borrowed an interest-free loan of approximately
$538,000 from a director and stockholder, Mr. Anthony So to provide working capital. This loan was to be repaid by installments
in 48 months. As of March 31, 2015, the Company had repaid approximately $67,000 to Mr. Anthony So, and the balance of loan due
to Mr. Anthony so was approximately $471,000.
During
the fiscal year ended March 31, 2015, one of the subsidiaries in Shenzhen, PRC entered into a rental agreement with a director
and stockholder, Mr. Anthony So, for three apartment units located in Shenzhen, PRC for office usage. Mr. Anthony So is the sole
owner of these three apartment units. The monthly rental payment was approximately $2,000, and the total rental payment paid to
Mr. Anthony So during the fiscal year ended March 31, 2015 was approximately $10,000.
During
the fiscal year ended March 31, 2015, one of the subsidiaries in Xinxing, PRC entered into a rental agreement with a director
and stockholder, Mr. Andrew So, for an apartment unit located in Xinxing, PRC for staff quarters. Mr. Andrew So is the sole owner
of this apartment unit. The monthly rental payment was approximately $480, and the total rental payment paid to Mr. Andrew So
during the fiscal year ended March 31, 2015 was approximately $2,000.
-F-33-
Bonso
Electronics International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
16
Concentrations
                                         and credit risk
The
Company operates principally in the PRC (including Hong Kong) and grants credit to its customers in this geographic region. Although
the PRC is economically stable, it is always possible that unanticipated events in foreign countries could disrupt the Company's
operations.
Financial
instruments that potentially subject the Company to a concentration of credit risk consist of cash and trade receivables. The
Company does not require collateral to support financial instruments that are subject to credit risk.
At
March 31, 2014 and 2015, the Company had credit risk exposure of uninsured cash and deposits and less than one year in banks of
approximately $1,165,000 and $3,027,000, respectively.
A
substantial portion, 52%, 45% and 37% of revenue, was generated from one customer for the years ended March 31, 2013, 2014 and
2015, respectively.
The
net sales to customers representing at least 10% of net total sales are as follows:
Year Ended March
    31,
2013
2014
2015
$ in thousands
%
$ in thousands
%
$ in thousands
%
Sunbeam Products, Inc.
15,818
52
14,080
45
6,879
24
Fitbit, Inc.
5,493
18
10,396
33
10,593
37
Kern + Sohn GMBH
3,814
13
2,762
9
5,424
19
25,125
83
27,238
87
22,896
80
The
following customers had balances greater than 10% of the total trade receivables at the respective balance sheet dates set forth
below:
March 31,
2014
2015
$ in thousands
%
$ in thousands
%
Sunbeam Products, Inc.
1,523
61
101
8
Fitbit, Inc.
355
14
324
25
Kern + Sohn GMBH
169
7
224
17
Pitney Bowes Inc.
219
9
355
27
91
77
At
March 31, 2014 and 2015, these customers accounted for 91% and 77%, respectively, of net trade receivables. The trade receivables
have repayment terms of not more than twelve months. Trade receivables for two customers accounted for 33% of total trade receivables
as of March 31, 2015 (2014: 75%), and they were covered by credit insurance under a factoring agreement with a bank.
-F-34-
Bonso
Electronics International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
17
Employee
                                         retirement benefits and severance payment allowance
(a)
With
                                         effect from January 1, 1988, BEL, a wholly-owned foreign subsidiary of the Company in
                                         Hong Kong, implemented a defined contribution plan (the "Plan") with a major
                                         international insurance company to provide life insurance and retirement benefits for
                                         its employees. All permanent full time employees who joined BEL before December 2000,
                                         excluding factory workers, are eligible to join the Plan. Each eligible employee that
                                         chooses to participate in the Plan is required to contribute 5% of their monthly salary,
                                         while BEL is required to contribute from 5% to 10% depending on the eligible employee's
                                         salary and number of years in service.
The
Mandatory Provident Fund (the "MPF") was introduced by the Hong Kong Government and commenced in December 2000. BEL
joined the MPF by implementing a plan with a major international insurance company. All permanent Hong Kong full time employees
who joined BEL on or after December 2000, excluding factory workers, must join the MPF, except for those who joined the Plan before
December 2000. Both the employee's and employer's contributions to the MPF are 5% of the eligible employee's
monthly salary and are subject to a maximum mandatory contribution of HK$1,000 (US$128) per month. Both the maximum mandatory
employee's and employer's contributions per month increased to HK$1,250 (US$160) since June 1, 2012, and then later
to HK$1,500 (US$192) since June 1, 2014.
Pursuant
to the relevant PRC regulations, the Company is required to make contributions for each employee, at rates based upon the employee's
standard salary base as determined by the local Social Security Bureau, to a defined contribution retirement scheme organized
by the local Social Security Bureau in respect of the retirement benefits for the Company's employees in the PRC.
(b)
The
                                         contributions to each of the above schemes are recognized as employee benefit expenses
                                         when they are due and are charged to the consolidated statement of operations. The Company's
total contributions and accruals to the above schemes
                                         for the years ended March 31, 2013, 2014 and 2015 amounted to $225,000, $758,000 and
                                         $693,000, respectively.
The Company has no other obligation to make payments in
                                         respect of retirement benefits of the employees.
(c)
According
                                         to the New Labor Law in the PRC which was effective on January 1, 2008, a company is
                                         required to provide one month's salary for each year of service as a severance
                                         payment. As such, the Company paid $1,194,000 for severance payment in the fiscal year
                                         ended March 31, 2014 to the terminated staff when production was moved from the Shenzhen
                                         factory to the Xinxing factory. The Company recognized a provision of $256,000 in the
                                         fiscal year ended March 31, 2015 for severance payments for staff in the PRC (2014: $156,000,
                                         2013: $743,000). The accrued severance payment allowance is reviewed every year.
-F-35-
Bonso
Electronics International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
18
Net
                                         (loss) / earnings per share
Basic
(loss) / earnings per share is computed by dividing net (loss) / earnings available to common stockholders by the weighted average
number of shares of common stock outstanding. Diluted earnings per share is computed in a manner consistent with that of basic
earnings per share while giving effect to all potentially dilutive shares of common stock that were outstanding during the period,
including stock options. The outstanding 30,000 options as of March 31, 2015 have an anti-dilutive effect and are excluded from
calculation of weighted average shares outstanding.
The
diluted net (loss) / earnings per share was the same as the basic net (loss) / shares per share for the years ended March 31,
2013, 2014 and 2015, as all potential common shares (110,000 shares on March 31, 2013, 70,000 shares on March 31, 2014 and 30,000
shares on March 31, 2015) from the exercise of stock options are anti-dilutive and are therefore excluded from the computation
of diluted net (loss) / earnings per share.
-F-36-
Bonso
Electronics International Inc.
Notes to
Consolidated Financial Statements
(Expressed
in United States Dollars)
19
Business
                                         segment information
(a)
The Company
                                         is organized based on the products it offers. Under this organizational structure, the
                                         Company's operations can be classified into three business segments, Scales, Pet
                                         Electronics Products and Others for the fiscal years ended March 31, 2014 and 2015.
Scales
operations principally involve production and marketing of sensor-based scales products. These include bathroom, kitchen, office,
jewelry, laboratory, postal and industrial scales that are used in consumer, commercial and industrial applications. Revenue from
scale products were 89% (2014: 95%) of overall revenue of the Company for the fiscal year ended March 31, 2015, and the Company
expects that the revenue from scale products will continue to contribute a similar level of revenue for the next
12 months.
Pet
Electronics Products principally involve development and production of pet-related electronics products that are used in consumer
applications. Revenue from pet electronics products were 10% (2014: 4%) of overall revenue of the Company for the fiscal year
ended March 31, 2015, and the Company expects that the revenue from pet electronics products will continue to contribute a similar level of revenue for the next 12 months.
The
"Others" segment is a residual, which principally includes the activities of (i) tooling and mould charges for scales
and pet electronics products, and (ii) sales of scrap materials.
The following table sets
forth the percentage of net sales for each of the product lines mentioned above for the fiscal years 	ended March 31, 2013,
2014, and 2015:
Year ended March
    31,
Product Line
2013
2014
2015
Scales
90
%
95
%
89
%
Pet Electronics Products
8
%
4
%
10
%
Others
2
%
1
%
1
%
Total
100
%
100
%
100
%
The
accounting policies of the Company's reportable segments are the same as those described in the description of business
and significant accounting policies.
-F-37-
Bonso
Electronics International Inc.
Notes
to Consolidated Financial Statements
(Expressed
in United States Dollars)
19
Business
                                         segment information (continued)
(a)
(Continued)
Summarized
financial information by business segment as of March 31, 2013, 2014 and 2015 is as follows:
Net
                                         sales
Operating
                                         (loss)/income
Identifiable
                                         assets as of
March 31
Depreciation
    and amortization
Capital
    expenditure
$
                                         in thousands
$
                                         in thousands
$
                                         in thousands
$ in thousands
$ in thousands
2013
Scales
    & Others (A)
27,998
(371
)
18,518
111
1,301
Pet
    Electronics Products (A)
2,388
(32
)
1,579
9
111
Total
    operating segments
30,386
(403
)
20,097
120
1,412
Corporate
—
—
7,026
226
-
Group
30,386
(403
)
27,123
346
1,412
2014
Scales &
    Others(A)
29,837
281
23,279
1,035
2,762
Pet
    Electronics Products (A)
1,468
14
1,145
51
136
Total
    operating segments
31,305
295
24,424
1,086
2,898
Corporate
—
—
7,716
289
-
Group
31,305
295
32,140
1,375
2,898
2015
Scales
    & Others
25,911
414
16,172
968
1,472
Pet
    Electronics Products
3,033
48
1,893
114
173
Total
    operating segments
28,944
462
18,065
1,082
1,645
Corporate
—
—
7,712
294
—
Group
28,944
462
25,777
1,376
1,645
Note A: Segment information for the fiscal years
ended March 31, 2013 and 2014 have been restated as the Pet Electronics Product segment met the 10% threshold for the fiscal
year ended March 31, 2015.
Operating
(loss) / income by segment equals total operating revenues less expenses directly attributable to the generation of the segment's
operating revenues. Operating loss of the corporate segment consists principally of salaries and related costs of administrative
staff, and administration and general expenses of the Company. Identifiable assets by segment are those assets that are used in
the operation of that segment. Corporate assets consist principally of cash and cash equivalents, investment in life insurance
contracts, income tax recoverable, other intangible assets, and other identifiable assets not related specifically to individual
segments.
-F-38-
Bonso Electronics
International Inc.
Notes
to Consolidated Financial Statements
(Expressed
in United States Dollars)
19
Business
                                         segment information (continued)
(b)
The
                                         Company primarily operates in Hong Kong and the PRC. The manufacture of components and
                                         their assembly into finished products and research and development are carried out in
                                         the PRC. As the operations are integrated, it is not practicable to distinguish the net
                                         income derived among the activities in Hong Kong, and the PRC.
Total
property, plant and equipment, net by geographical areas are as follows:
March
                                         31,
March
                                         31,
2014
2015
$ in
                                         thousands
$ in
                                         thousands
Hong Kong
1,090
1,194
The
    PRC
11,362
11,290
Total property, plant and equipment
12,452
12.484
(c)
The following
                                         is a summary of net export sales by geographical areas, which are defined by the final
                                         shipment destination, constituting 10% or more of total sales of the Company for the
                                         years ended March 31, 2013, 2014 and 2015:
Year
    ended March 31,
2013
2014
2015
$ in thousands
%
$ in thousands
%
$ in thousands
%
United
    States
23,804
78
25,203
81
21,271
73
Germany
5,121
17
4,688
15
6,210
22
28,925
95
29,891
96
27,481
95
(d)
The following
                                         is a summary of net export sales by customers, constituting 10% or more of total sales
                                         of the Company for the years ended March 31, 2013, 2014 and 2015:
Year
                                         ended March 31,
2013
2014
2015
Customers
Segment
$ in thousand
%
$ in thousands
%
$ in thousands
%
Sunbeam
    Products, Inc.
Scales
    & Pet Electronics Products
15,818
52
14,080
45
6,879
24
Fitbit, Inc.
Scales
5,493
18
10,396
33
10,593
37
Kern
    + Sohn GMBH
Scales
3,814
13
2,762
9
5,424
19
25,125
83
27,238
87
22,896
80
-F-39-
Bonso Electronics
International Inc.
Notes
to Consolidated Financial Statements
(Expressed
in United States Dollars)
20
Subsequent
                                         events
On
July 9, 2015, the Company issued options to certain directors and non-employee directors of the Company to purchase an aggregate
of 850,000 shares of common stock of the Company at an exercise price of $1.50. The options for 425,000 shares will expire on
March 31, 2020, and options for 425,000 shares will expire on March 31, 2025. The exercise prices of these options were equal
to the fair market value at the time of grant. No such options have been exercised through the date of this report.
On
July 10, 2015, the Company entered into an agreement with a third party to sell part of the Company's land use right in
Xinxing, PRC for approximately $866,000. The area of this piece of land is approximately 18% of the total land area of our Xinxing
manufacturing facility. The selling price is approximately 86% more than our initial purchase price, and the resulting gain will
be determined upon final measurement by the local Land Department and the taxation charges by the local tax authorities. This
piece of land includes part of the land use rights currently arranged as securities to a bank for the banking facilities arrangement.
The Company is working with the bank in order to release part of the land use right to the buyer.
-F-40-