Methodology For The Halter USX China Index (Ticker: HXC)

INDEX DESCRIPTION
The Halter USX China Index ("Index") is a modified market capitalization weighted index comprised of companies whose common stock is publicly traded in the United States and the majority of whose business is conducted within the People's Republic of China. The Index is designed to provide insight and access to the unique economic opportunities taking place in China while still providing the transparency offered with U.S. listed securities.

The Index is rebalanced quarterly each March, June, September and December. The Index divisor was initially determined to yield a benchmark value of 2500.00 at the close of trading on September 30, 2003. The Halter USX China Index was created by, and is a trademark of, Halter Financial Group ("Index Provider"). The American Stock Exchange LLC ("Amex") serves as the calculation agent for the Index. The value of the Index is disseminated every 15 seconds over the Consolidated Tape Association's Network B between the hours of approximately 9:30am and 4:15pm under the ticker symbol "HXC".


ELIGIBILITY CRITERIA FOR INDEX COMPONENTS
The Index includes companies that conduct the majority of their business within the People's Republic of China, are listed on a the NYSE, Nasdaq or Amex and have a market-cap greater than $50 million based on the average closing price for the prior 40 trading days, as identified by the Halter USX China Selection Committee (the "Selection Committee"). In addition to these basic requirements, the Selection Committee may consider other factors including the size of the public float, liquidity and fundamentals of all existing and potential constituents.

The Index Provider may at any time and from time to time change the number of issues comprising the Index by adding or deleting one or more components, or replace one or more issues contained in the Index with one or more substitute stocks of its choice.


CALCULATION METHODOLOGY
The Index is calculated using a modified market capitalization weighting methodology. The components market capitalization weights are modified to conform to the following asset diversification rules, which are applied in conjunction with the scheduled quarterly updates to the Index:

1) The weight of any component stock may not account for more than 20% of the total value of the Index; component stocks greater than 20% of the Index are reduced to individually represent 20% of the value of the Index. The aggregate amount by which all components over 20% were reduced is redistributed proportionately across the remaining components that represent less than 20% of the Index value. After this redistribution, if any other component then exceeds 20%, the component is set to 20% of the Index value and the redistribution is repeated.

2) The Index components are then sorted into two groups: large and small by index weight. Large components have an index weight of 4.5% or greater and small components are those that are under 4.5%. The large components will be scaled down to in aggregate equal 30% of the Index weight with a floor of 4.5%. The aggregate amount by which the large components were reduced will be redistributed proportionately to the small components. After the redistribution, if any small component's weight exceeds 4.5%, then the weight of such components are set equal to 4.5% and the balance is redistributed proportionately to the remaining small components. The process is repeated until all small components are less than or equal to 4.5%.

QUARTERLY UPDATES TO THE INDEX
Changes to the Index composition and/or the component share weights in the Index typically take effect after the close of trading on the next to last business day of each calendar quarter month ("Rebalance Date"). The components and weights will be announced after the close of trading two days prior to the Rebalance Date. The Index components are determined five days prior to the Rebalance Date. A component must continue to meet the following continued inclusion rules:

1) Market capitalization above $50 million based on the average closing price for the prior 40 days
2) Listed on the New York Stock Exchange, American Stock Exchange or quoted on the Nasdaq National or Small Cap Market Systems
3) Conduct the majority of their business in the People's Republic of China, based on evaluation by the Halter USX China Index Selection Committee

The constituent additions and/or deletions determined by the Halter USX China Index Selection Committee are provided to the Amex five days prior to the Rebalance Date in March, June, September and December. Amex will announce the Index components and additions and/or deletions to the public. Currently, the Amex makes all such announcements with regard to Index component changes via the Index Daily List on its website www.amextrader.com.

In conjunction with the quarterly review, the share weights used in the calculation of the Index are updated based upon current shares outstanding and prices as of the close of trading two business days prior to the Rebalance Date using the modification method described above. Amex will determined the share weights and announce the Index composition to be in effect with the Rebalance.

The share weight of each component in the Index portfolio remains fixed between quarterly reviews except in the event of certain types of corporate actions such as shares changes (issuances or repurchases), stock splits, stock dividends, rights offerings, spinoffs, restructurings, or similar events.


MAINTENANCE OF THE INDEX
The Index Provider may substitute components or change the number of issues included in the index, based on changing conditions in the industry or in the event of certain types of corporate actions, including mergers, acquisitions, spin-offs, and reorganizations. The Amex will consult with the Index Provider regarding any stock additions or deletions to be made in response to corporate actions. In the event of a merger between two components, the share weight of the surviving entity may be adjusted to account for any shares issued in the acquisition. The Index Provider may add a component between quarterly rebalances at the full weight of the company, at the next rebalance date the component's weight will be adjusted to conform with the Index diversification rules.

In the event of component or share weight changes to the Index portfolio, the payment of dividends other than ordinary cash dividends, spin-offs, rights offerings, re-capitalization, or other corporate actions affecting a component of the Index; the Index divisor may be adjusted to ensure that there are no changes to the Index level as a result of non-market forces. For changes in a component's shares outstanding greater than 5% due to a merger, acquisition or spin-off, an adjustment will be made effective after the close on the effective date of the corporate action. Share changes less than 5% are made during the scheduled quarterly updates to the Index. Adjustments to the Index Divisor for changes in market value leave the Index unaffected by additions and deletions of constituents or corporate action.


DISSEMINATION OF INDEX INFORMATION
The Index Provider will provide to the Amex the constituents of the Index on the sixth to the last business day of each quarterly rebalance month. Whenever practical, the Index Provider will pre-announce stock additions and/or deletions as well as certain Index share weight changes at least three trading days before making such changes effective -- either via www.amextrader.com, via broadcast email, or press release.

CURRENCY
All data used in association with the Index is in US dollars.