Flextronics & Li & Fung Confidential Action Items Li & Fung 1)Review all Concept documents, provide feedback, and provide suggestions to fill gaps. 2)Provide improved Concept diagrams (e.g., SMART Sleeve, SMART Gamer’s Cap, SMART Shelf, and SMART Handbag). 3)Complete additional market demand research working to: a)Increase volumes and expand application of initiatives – we would like higher volumes and broader applications, if possible. b)Provide additional requirements, as necessary, and prioritize requirements. c)Provide any references for market demand that supports market estimates. 4)Provide Total Addressable Market (TAM) volumes (e.g., how many activewear jackets are sold per year by Li&Fung and what % of the market does this represent) for all Concepts. Flextronics 1)Compare proposed initiatives with previous and current Flextronics’ initiatives to look for relevant experiences and related outcomes. Use this experience to prioritize initiatives. 2)Conceptual design a)Estimate effort b)Determine timeline c)Estimate ‘product cost’ 3)Prioritize Concepts based on market volumes, Non- Recurring Engineering (NRE costs), and timelines to bring technology to market. 4)Complete additional market research in conjunction with Li & Fung.

Flextronics & Li & Fung Confidential SMART Shelf Li & Fung Contacts: hk.com hk.com

Flextronics & Li & Fung Confidential USE CASE / EXPERIENCES Brands struggle to manage large numbers and varieties of components aimed at communication at the POS (e.g., printed ticket strips and injection-moulded copy tags). Provides digital communication via a fixture that can react to product introduction and movement. Product could be tagged and then detected by the fixture. Brands can then easily manage the introduction of new product, inventory management, and update of product information via the Cloud. Consumers would then interact with the POS and product and in doing so gain greater access to a broader range of information and then engage further with the brand and products. Consumer focus on interaction and engagement. Brand / retail focus for inventory / communication and content updates. REQUIREMENTS Fixture or shelf that detects and reads what product resides on that shelf within a defined range. A ‘tag’ that can attach to a product, be cost effective, and be independent of the retail security system. A means by which to remotely manage content and push to the device. In addition to using the fixture or shelf to capture data from the consumer interaction. A system that can identify individual product. A display that can communicate information relating to that product. A means by which to remotely update the content or add new content. Three core components = TAG / READER / SYSTEM ROADMAP Identify optimal tag / identification device. Identify optimal detection (e-Field / Computer Vision). Build sample to prove concept. Demo to target brand. Pilot (internal focus group testing) store trial (Consumer testing) BENEFITS Reduce or eliminate manual inventory. Real-time / remote inventory management. Remote update from a central location. Dynamic communication via digital display. Manage and minimize shrinkage. Planogramming / visual merchandising. Manage multiple languages at the POS. Allow consumers to explore products without a sales associate. Identify and track product interactions / selections – analytics. TARGET PRICE / MARKET SIZE Indication Price as system – 20 product / 4 shelves per installation Guesstimate – ??? Cost out for Brand – Printed media, manufacture of copy tag devices / managing language variation, packaging of copy tags, logistics – delivery and installation. Cost add for Brand – Higher per unit cost for initial investment to replace with SMART shelf, content management service / field services. (Jake to review with POS team to add some meaningful numbers) Retailer – Kohls might use this across all shelves for beauty. Brand – Clinique might use in all Travel Retail / DFS locations globally. COMPLEXITY / RISK Lack of acceptance by retailer (Sephora) where brand (Clinique) is represented. Connectivity provision in store. Tagging of product (at source / at retail). Initial investment potentially regarded as prohibitive. PROTOTYPE MVP / POC – Simple shelf fixture, showing how five tagged products are identified, how the system can react, and how the display changes accordingly. SMART SHELF – e-Shelf

Flextronics & Li & Fung Confidential