Explanation of Responses ------------------------ Name: Citadel Equity Fund Ltd. Address: c/o Citadel Investment Group, L.L.C. 131 S. Dearborn Street, 32nd Floor Chicago, Illinois 60603 Issuer and Ticker Symbol: Harbin Electric, Inc. HRBN Date of...Explanation Of • September 11th, 2006 • Citadel L P • Motors & generators
Citadel Equity Fund Ltd. entered into a purchase agreement, dated August 29, 2006 (the "Purchase Agreement") with the Issuer, Advanced Electric Motors, Inc., a wholly owned subsidiary of the Issuer, and Merrill Lynch International, pursuant to which Citadel Equity Fund Ltd. purchased, among other things, (i) six-year warrants to purchase an aggregate of 2,192,308 shares of common stock of Issuer and (ii) six-year warrants to purchase an aggregate of 525,830 shares of common stock of Issuer. Citadel Limited Partnership is the trading manager of Citadel Equity Fund Ltd. and consequently has voting control and investment discretion over securities held by Citadel Equity Fund Ltd., and may be deemed to indirectly control Citadel Equity Fund Ltd. Citadel Investment Group (Hong Kong) Limited provides investment advisory services to Citadel Limited Partnership with respect to Hong Kong-based investment activities. Each of the other persons jointly filing this Form 3 may be deemed to indirectl
