China Education Technology (EVSF) 8-K Entry into a Material Definitive Agreement

ADDE Education Hldgs Limited

Pro Forma Condensed

Combined Financial Statements

For the three months ended March 31, 2008

and the year ended December 31, 2007

ADDE Education Hldgs Limited

Pro Forma Condensed Combined Financial Statements

For the three months ended March 31, 2008 and the year ended December 31, 2007

Index to Pro Forma Condensed Combined Financial Statements

	Pages
Introduction to Pro Forma Condensed Combined Financial Statements	3
Unaudited Pro Forma Condensed Combined Balance Sheet	4
Unaudited Pro Forma Condensed Combined Statement of Operations	5
Notes to Pro Forma Condensed Combined Financial Statements	6

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ADDE Education Hldgs Limited

Introduction to Pro Forma Condensed Combined Financial Statements

The following unaudited pro forma condensed combined financial statements are presented to illustrate the estimated effects of the acquisition of Guangzhou Haoyu Educational Technology Company Limited (“Haoyu”) by ADDE Education Hldgs Limited (“ADDE”) (the “Transaction”) on the historical financial position and results of operations of ADDE.

The pro forma balance sheet as of March 31, 2008 is based on the unaudited balance sheets of ADDE and Haoyu as of March 31, 2008.  The pro forma statement of operations for the three months ended March 31, 2008 is based on the unaudited statements of operations of ADDE for the period from February 12, 2008 (date of inception) to March 31, 2008 and of Haoyu for the three months ended March 31, 2008.  The pro forma statement of operations for the year ended December 31, 2007 is based on the audited statement of operations of Haoyu.  As ADDE was incorporated on February 12, 2008, the financial data of the statement of operations of ADDE for the year ended December 31, 2007 were reported nil.

The unaudited pro forma condensed combined statements of operations for the three months ended March 31, 2008 and for the year ended December 31, 2007 assume that the Transaction was consummated on January 1, 2007. The unaudited pro forma condensed combined balance sheet as of March 31, 2008 assumes the Transaction was consummated on that date.

The information presented in the unaudited pro forma condensed combined financial statements does not purport to represent what the financial position or results of operations of ADDE would have been had the Transaction occurred as of the dates indicated, nor is it indicative of the future financial position or results of operations for any period of ADDE.

The pro forma adjustments are based upon available information and certain assumptions that the management of ADDE believes are reasonable under the circumstances.

These unaudited pro forma condensed combined financial statements should be read in conjunction with the accompanying notes and assumptions and the historical financial statements and related notes of ADDE and Haoyu.

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ADDE Education Hldgs Limited

Unaudited Pro Forma Condensed Combined Balance Sheet

As of March 31, 2008

(Stated in US Dollars)

	ADDE			Haoyu
	As of			As of						Pro forma
	March 31,			March 31,		Pro forma				combined
	2008			2008		adjustment				total
ASSETS
Current assets:
Cash and cash equivalents	$	13,532		$	35,758					$	49,290
Trade receivables		-			483,094						483,094
Other receivables and prepayments		16,133			225,358						241,491
Inventories		-			280,837						280,837
Total current assets		29,665			1,025,047						1,054,712
Property, plant and equipment, net		-			79,603						79,603
Total assets	$	29,665		$	1,104,650					$	1,134,315
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Trade payables	$	-		$	783					$	783
Other payables and accrued expenses		-			155,837						155,837
Amount due to a director		31,413			83,126						114,539
Income tax payable		-			129,514						129,514
Total current liabilities		31,413			369,260						400,673
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ (DEFICIT) EQUITY
Common stock		1,351			-						1,351
Registered and paid-up capital		-			120,801		(120,801	)	Note 2		-
Additional paid-in capital		-			-		117,702		Note 2		117,702
Statutory and other reserves		-			42,468						42,468
Accumulated other comprehensive income		-			66,704						66,704
(Accumulated deficit) retained earnings		(3,099	)		505,417		3,099		Note 2		505,417
Total stockholders’ (deficit) equity		(1,748	)		735,390						733,642
Total liabilities and stockholders’ (deficit) equity	$	29,665		$	1,104,650					$	1,134,315

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ADDE Education Hldgs Ltd.

Unaudited Pro Forma Condensed Combined Statement of Operations

For the three months ended March 31, 2008

(Stated in US Dollars)

	ADDE			Haoyu
	Three months			Three months			Pro forma
	ended March 31,			ended March 31,			combined
	2008			2008			total
Sales	$	-		$	1,002,654		$	1,002,654
Cost of goods sold		-			(496,021	)		(496,021	)
Gross profit		-			506,633			506,633
Operating expenses
General and administrative expenses		3,099			49,400			52,499
Research and development expenses		-			17,076			17,076
Selling expenses		-			15,624			15,624
Total operating expenses		3,099			82,100			85,199
Net operating (loss) income		(3,099	)		424,533			421,434
Other income
Subsidy income from the PRC authorities
for general operations		-			97,261			97,261
Interest income		-			164			164
Other income		-			18,174			18,174
Total other income		-			115,599			115,599
(Loss) income before income taxes		(3,099	)		540,132			537,033
Income taxes		-			(120,728	)		(120,728	)
Net (loss) income	$	(3,099	)	$	419,404		$	416,305
Pro forma (loss) income per share (Note 3)	$	(0.31	)		N/A		$	41.63

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ADDE Education Hldgs Ltd.

Unaudited Pro Forma Condensed Combined Statement of Operations

For the year ended December 31, 2007

(Stated in US Dollars)

	ADDE		Haoyu
	Year ended		Year ended			Pro forma
	December 31,		December 31,			combined
	2007		2007			total
Sales	$	-	$	1,056,602		$	1,056,602
Cost of goods sold		-		(845,611	)		(845,611	)
Gross profit		-		210,991			210,991
Operating expenses
General and administrative expenses		-		140,639			140,639
Research and development expenses		-		121,346			121,346
Selling expenses		-		104,561			104,561
Total operating expenses		-		366,546			366,546
Net operating loss		-		(155,555	)		(155,555	)
Other income
Subsidy income from the PRC authorities
for general operations		-		39,847			39,847
Interest income		-		130			130
Other income		-		6,823			6,823
Total other income		-		46,800			46,800
Income before income taxes		-		(108,755	)		(108,755	)
Income taxes		-		(4,823	)		(4,823	)
Net loss	$	-	$	(113,578	)	$	(113,578	)
Pro forma loss per share (Note 3)		N/A		N/A		$	(11.36	)

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ADDE Education Hldgs Ltd.

Notes to Pro Forma Condensed Combined Financial Statements

1. Ms. Yan Chang Ping and Mr. Guo Yan Bin are the sole stockholder of ADDE and Haoyu respectively.  Mr. Guo and Ms. Yan are couples. As ADDE and Haoyu are under the control of same controlling stockholders and management, the Transaction is deemed to be a recapitalization. ADDE (the legal acquirer) is considered the accounting acquiree and Haoyu (the legal acquiree) is considered the accounting acquirer. The financial statements of the combined entity will in substance be those of Haoyu, with the assets and liabilities, and revenues and expenses, of ADDE being included effective from the date of consummation of the Transaction. ADDE is deemed to be a continuation of the business of Haoyu. The outstanding common stock of ADDE prior to the Transaction will be accounted for at their net book value and no goodwill will be recognized.

2. To recapitalize for the Transaction.

3. The pro forma income/loss per share for the three months ended March 31, 2008 and the year ended December 31, 2007 are based on the weighted average number of ADDE’s common stock outstanding during the period from February 12, 2008 (date of inception) to March 31, 2008.