1. 10 Strategic Sectors Executive Summary "Made in China 2025" is an initiative to comprehensively upgrade Chinese industry that is inspired by Germany's "Industry 4.0" plan. The Chinese effort is broader due to highly uneven efficiency and quality of Chinese producers. Multiple challenges must be rapidly overcome if China is to avoid being squeezed between emerging low-cost producers and advanced economies. Made in China 2025 《中国制造 2025 》 APPROVED BY: China State Council, July 7, 2015 Manufacturing Innovation Capability Integration of IT & Industry Fundamental Industrial Capabilities Quality & Branding Green Production Breakthroughs in Major Areas Manufacturing Structural Adjustment Service-oriented Manufacturing Manufacturing Internationalization New-energy Vehicles & Equipment Maritime Equipment & Shipping Advanced IT Aerospace & Aeronautical Power Equipment New Materials Agricultural Equipment Automated Machines & Robotics Rail Transport Equipment Biopharma & Medical Products 9 Strategic Priorities Institutional Mechanism Reform Fair Market Environment Financial Support Policies Fiscal & Taxation Policy Multi-level Talent Cultivation Systems SME Enterprise Policy Manufacturing Openness Organization & Implementation System State Council Oversight & Support 9 Support Mechanisms www.iotone.com | Accelerating the Industrial Internet of Things

2. 12 KEY PERFORMANCE INDICATORS Made in China 2025 is unique in scope and scale: it focuses on the entire manufacturing process; it promotes the development of both traditional and advanced advanced industries, and; it relies heavily on market incentives. Despite its market-orientation, the plan is guided by government agencies and supported by well financed projects aimed at increasing R&D spending and incentivizing multinational companies to shift R&D resources to China. There are quantified targets for manufacturing innovation, quality, upgrades, and green production, with goals set for 2020 and 2025 and benchmarks identified for 2013 and 2015. Although goals are specifically identified, supporting tactics remain undefined. We expect local, regional, and central government agencies to propose supporting initiatives in 2016. CategoryManufacturing Transformation Indicator20152025 Innovation Capability 1. R&D cost / revenue (%)0.951.68 2. Patents / billion RMB of revenue (#)0.441.10 Quality & Value 3. Manufacturing quality competitiveness (index) 83.585.5 4. Manufacturing value-added increase over 2015 (%)-4 5. Average annual labor productivity growth (%)-6.5 IT & Industry Integration 6. Broadband penetration (%)5082 7. Digital R&D and design tool penetration (%)5884 8. Key process control rate (%)3364 Green Industry 9. Energy decrease over 2015 / industrial value add (%)-34 10. CO 2 decrease over 2015 / industrial value add (%)-40 11. Water use decrease over 2015 / industrial value add (%)-41 12. Industrial solid wastes utilization ratio (%)6579 Made in China 2025 《中国制造 2025 》 APPROVED BY: China State Council, July 7, 2015 www.iotone.com | Accelerating the Industrial Internet of Things