CONFIDENTIAL INFORMATION MEMORANDUM

SHERATON YILAN RESORT

YILAN, TAIWAN

JANUARY 2010

CONFIDENTIAL INFORMATION MEMORANDUM

SHERATON YILAN RESORT

An opportunity to participate in the Preferred Equity Investment of the 182-key international 5-star Sheraton Yilan Resort development in Yilan County, Taiwan. Transaction Overview In 2009, Sky Line International Entertainment Limited (“Skyline”) and Thomas R Hofer & Associates entered into an Alliance Agreement for obtaining funding to develop the Sheraton Yilan Resort, Taiwan (the “Resort” or the “Property”). The Property is currently over 50% completed is expected to become the top resort hotel in Taiwan with consummate design and construction, comprehensive amenities, professional hotel and spa operators including Sheraton and Banyan Tree. The total development cost is approximately NT$3.5 billion (US$ 107 million). Skyline is currently seeking additional equity investment in the amount of US$25.7million (NT$835million) and US$53.8million (NT$1,750million) in senior debt finance. Assuming the new investor injects NT$835million of new equity, the new investor will own 47.7% of Skyline. Recently valued at market value of NT$5.532‐5.685 billion based on DTZ valuation report dated 09.10.2008. (Note: USD/NTD exchange rate of US$1=NT$32.5045)

Property Information

Architect rendering of the Resort (above), and recent photos of Main Hotel Tower (bottom)

The Sheraton Yilan Resort will provide 182 spacious guest rooms and suites (ranging from 360 sq. ft. to 3384 sq. ft.) all enjoying beautiful views from private balconies. It will also feature over 10,000 square ft. of highly flexible meeting and function space, eight dining and entertainment outlets,

two fitness centres and 26,000 square ft. spa managed by Banyan Tree’s Angsana Spa, 44 oriental and family hot spring houses, as well as a 17,800 square ft. outdoor hot spring pool and an indoor heated swimming pool.

The Resort features 5 separate blocks: The Main Hotel, Hot Springs, Resort, Villa, and the Administrative block1. Each block is catered towards different customer groups, and is designed with the appropriate facilities.

Block Purpose Key Count Facilities & Amenities

Hotel Family Vacation, Meetings & Conventions

90

Meeting & function space, fusion-style buffet Restaurant, indoor and outdoor swimming pool

Hot Springs Spa and Hot Springs Visitors ---

Angsana Spa, 44 hot spring houses, public bathhouse, roof pool

Resort Couples Retreat 65 Japanese kaiseki restaurant, all suite hotel, outdoors hot spring pool

Villa Provides privacy and exclusiveness 27 Private swimming & hot

spring pool The blocks can be roughly grouped into 2 zones, with Zone 2 being more family friendly, while Zone 1 is geared towards adults and commands premium prices. The site covers approximately 1 million sq. ft. on a hilltop and has a GFA of 510,000 sq. ft.. Due to its high altitude of 200 to 280 meters above sea-level, the Property offers unobstructed panoramic views of the Yilan Plains, Pacific Ocean, and the surrounding landscapes and tea plantations. The Property will be branded as a Sheraton franchised hotel, utilising the Sheraton name, logo, reservation systems, marketing programs, as well as operating procedures. The hotel interior is designed by Hong Kong designer John Chan who specializes in hotel interiors and whose previous assignments include Grand Hyatt Taipei, Grand Hyatt Hong Kong, Sheraton Hong Kong, St. Regis International Club Beijing and many other hotels in China. Business Plan The construction of the Hotel commenced in Nov 2007 and has since finished the construction of the majority of structural works in July 2008. The final completion of the interior and exterior of the Project is estimated early 2010. The Resort features a top-notch design team, which includes renowned architect firm I-Connect Architect & Associates and interior fit-out firm Dynasty Design Corp. Leeming, one of the largest construction companies in Taiwan, is contracted to build the Resort.

1 Administrative Block is for back office use only. Hotel guests are off limits.

CONFIDENTIAL INFORMATION MEMORANDUM

Expected soft opening early 2010 and grand opening in May 2010. The resort would be operated under a management agreement with Starwood Hotels & Resorts under the Sheraton brand and has an initial term of 10 years from the opening with 2 renewal options of 5 years each. The general manager appointed by Sheraton will be principally responsible for the operation of the hotel and the senior managers will be appointed by the general manager as well as the board of Skyline. In August 2008, an experienced GM candidate was recruited and commenced September, 2008. With such world-class facilities and management, the Resort features premium room rates, ranging from NT$7,000/night for a standard room up to NT$88,000/night for the Presidential suite. Banyan Tree Hotels & Resorts will operate the SPA facility in the resort as a world-class spa facility and conduct operations under the Angsana Spa brand for an initial term of 15 years. Angsana Spa is Banyan Tree’s first resort spa and first non-exclusive, open-to-general public spa in Taiwan. Banyan Tree views this as a value-added service to the hotel and hotel guests. A total of 12 treatment rooms are planned. Angsana Spa Yilan features exclusive hot springs treatment packages, not found in any other Banyan Tree Spa worldwide. Location / Market The site is located on a rural hilltop, against a mountainous backdrop in Yilan County on the northeast coast of Taiwan. It is 60 kilometers from Taipei and around 70 minutes drive via the Taipei-Yilan tunnel.

There is good accessibility to highways and a multitude of nearby scenic attractions and offering including the Dongshan River Water Park, Taiping Mountain, hot springs, golf courses, whale watching all within a half-hour drive from the Project. The landmark Mainland China Tourists Direct Charter flights to Taiwan scheme bodes well for the demand of hotel accommodation in Taiwan. Starting from July 2008, 3,000 China tourists to visit Taiwan via direct flight (from China) per day / 1 million tourists per annum to visit Taiwan, mostly for sight-seeing purposes. Currently, Hotel Royal Chiao Hsi, the only 5-star hotel competitor in the Yilan region, has averaged 75% occupancy rate at an average room rate of

NT$6,800 for the past 2 years. The Resort’s hotel block targets similar customers, and thus comparable results can be reasonably expected. Lalu Resort at Sun Moon Lake, which Zone 1 of the Resort is benchmarked to, has averaged an outstanding 81% occupancy rate with an excellent NT$10,119 avg. room rate. 5 more hotels/resorts are scheduled to open within the next few years. The clustering effect shall further enhance Yilan’s image as a major tourist destination. Sponsor Sky Line International Entertainment Limited (“Skyline”) owns the Property and acts as the operating partner in charge of development of the Resort. Skyline is currently 48% owned by its founders Willy Chang and his wife Teresa Liao and 38% owned by Mr. M. Chen, a major shareholder of Posiflex Technologies, Inc, a Taiwan OTC-traded company. Mr. Chang devoted himself to the Sheraton Yilan Project since 1995. He has successfully assembled the land title of the Property and obtained all the development rights and permits for the Development of the Resort. From 1998 to 2000, Mr. Chang was involved in the development of Hibiscus Resort, a 210-room resort hotel in Tainan, Taiwan. Mr. Chang is a board member of the Association for Construction and Investment of Taipei County and a member of the Council for Industrial and Commercial Development of Taiwan. Transaction Merits The only international-brand resort hotel in Taiwan operated by highly experienced operators: this Property represents Starwood’s fourth hotel in Taiwan and Banyan Tree’s second spa management contract in Taiwan. Rare location advantages: located only 60 kilometers away from Taipei, the Property is easily accessible after the opening of Taipei-Yilan Highway. The Property is situated in an exclusive, scenic and attractive location with numerous scenic attractions within a 20-minute radius in Yilan county. Strong leisure traveller demand for resort hotels in Taiwan, especially after the recent liberalisation of China tourists visit and charter flights permitting influx of mainland tourists for the first time in large number. Low development risk: the resort is being constructed by reputable contractor and the majority of structural works works completed in 2008 with final completion and opening scheduled for late 2010.

Sheraton Yilan Resort Development Costs

Amount USD$ %

Description

Land cost $25,227,276 23.43%

Structural works $24,367,395 22.63%

Interior furbishing $16,841,360 15.64%

Electrical & mechanical works $17,219,462 15.99%

Capital machinery & equipment $4,225,261 3.92%

Landscaping $3,207,556 2.98%

Planning design $3,025,427 2.81%

Initial revolving fund $4,820,871 4.48%

Preparatory & opening expenses $863,573 0.80%

Loan interest costs $3,527,512 3.28%

Grading $1,434,878 1.33%

Project management $2,916,827 2.71%

Total USD$107,677,399 100.00%