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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To Be Held [ ● ], 2017

Dear Stockholders:

On [●], 2017, Alliance HealthCare Services, Inc. (the “Company”) will hold its Annual Meeting of Stockholders at its corporate headquarters located at 18201 Von Karman Avenue, Suite 600, Irvine, California 92612. The meeting will begin at 9:00 a.m. Pacific time.

The purpose of the meeting is:

Our board of directors (referred to as the “Board”) (with Mr. Qisen Huang, Mr. Heping Feng and Dr. Tao Zhang recusing themselves), acting on the unanimous recommendation of the special committee, has approved the Merger Agreement and determined that the Merger Agreement and the transactions contemplated by it are advisable and in the best interests of and fair to the Company and its stockholders (other than the Purchaser Group (as defined below) and affiliates of Alliance, including its officers and directors). Our Board unanimously (other than Mr.  Huang, Mr.  Feng and Dr.  Zhang), recommends that the stockholders of the Company vote “FOR” the proposal to approve the adoption of the Merger Agreement . In addition, our Board urges you to vote “FOR” proposals 2, 4, 5 and 7 above, “FOR” each of the director nominees in Proposal 3 above, and for every “3 YEARS” with respect to Proposal 6 above.

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Your vote is very important, regardless of the number of shares of common stock of the Company, par value $0.01 per share (“Common Stock”) you own. The merger cannot be completed unless holders of (i) a majority of the aggregate voting power of the outstanding shares of Common Stock vote in favor of adoption of the Merger Agreement and (ii) a majority of the outstanding shares of Common Stock not beneficially owned by the Purchaser Parties or any “affiliate” (within the meaning of Rule 12b-2 under the Exchange Act) of any of the Purchaser Parties (the “Purchaser Group”) or any Section 16 officer of Alliance (determined pursuant to Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended) vote in favor of adoption of the Merger Agreement (the “majority of the minority stockholder approval”). If you fail to vote on the Merger Agreement, the effect will be the same as a vote against adoption of the Merger Agreement.

The holders of record of our Common Stock at the close of business on [●], 2017, are entitled to notice of and to vote at the annual meeting or at any adjournment of the meeting. All stockholders of record are cordially invited to attend the annual meeting in person. Even if you plan to attend the annual meeting in person, we request that you complete, sign, date and return the enclosed proxy and thus ensure that your shares will be represented at the annual meeting if you are unable to attend. You also may vote your shares by proxy using a toll-free telephone number or the Internet. We have provided instructions on the proxy card for using these convenient services.

If you sign, date and return your proxy and voting instruction card(s) without indicating how you wish to vote, your proxy will be voted in favor of Proposals 1, 2, 4, 5 and 7, in favor of each of the director nominees in Proposal 3, and in favor of “3 YEARS” with respect to Proposal 6. If you fail to attend the annual meeting or submit your proxy, it will have the same effect as a vote against the adoption of the Merger Agreement. You may revoke your proxy at any time before the vote at the annual meeting by following the procedures outlined in the enclosed proxy statement. If you are a stockholder of record, attend the annual meeting and wish to vote in person, you may revoke your proxy and vote in person.

The merger is described in the accompanying proxy statement, which we urge you to read carefully. A copy of the Merger Agreement is included as Annex A to the accompanying proxy statement.

By order of the Board of Directors

ALLIANCE HEALTHCARE SERVICES, INC.

This proxy statement, our 2016 annual report to stockholders and a form of proxy card are

available at www.alliancehealthcareservices-us.com/proxy

Irvine, California

[●], 2017

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Summary Term Sheet Relating to the Merger

This Summary Term Sheet discusses the material information regarding the merger contained in this proxy statement, but does not contain all of the information in this proxy statement that is important to your voting decision with respect to the adoption of the Merger Agreement or the other matters being considered at the annual meeting. We encourage you to read carefully this entire proxy statement, its annexes and the documents referred to or incorporated by reference in this proxy statement, as this Summary Term Sheet may not contain all of the information that may be important to you. The items in this Summary Term Sheet include page references directing you to a more complete description of that topic in this proxy statement.

Throughout this proxy statement we refer to:

The Parties to the Merger Agreement (Page 66)

Alliance HealthCare Services, Inc.

18201 Von Karman Avenue, Suite 600,

Irvine, California 92612

Alliance HealthCare Services, Inc., referred to herein as “Alliance”, the “Company”, “we”, “our” or “us”, is a Delaware corporation. Alliance is a leading national provider of outsourced medical services, including radiology, oncology and interventional. We provide a full continuum of services from mobile to comprehensive service line management and joint venture partnerships, which can include one or more of the following depending on the customer’s needs: systems, technologists to operate the systems, sales and marketing, patient scheduling and pre-authorization, billing and payer management, equipment maintenance and upgrades, overall management of services and fixed-site operations including outpatient clinics and Ambulatory Surgical Centers.

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Additional information about Alliance is contained in its public filings, which are incorporated by reference hereto. See “Where You Can Find Additional Information” beginning on page 145.

Tahoe Investment Group Co., Ltd.

No. 43 Hudong Road

Olympic Building

Fuzhou City, Fujian Province, China 350003

Tahoe Investment Group Co., Ltd., formerly Fujian Thai Hot Investment Co. Ltd. and referred to herein as “Tahoe”, is an entity organized under the laws of the People’s Republic of China. Tahoe was established by Mr. Qisen Huang and invests in various fields, such as finance, healthcare and real estate. As of the date of this proxy statement, Mr. Qisen Huang owns 95% of the outstanding shares of Tahoe.

THAIHOT Investment (Hong Kong) Company Limited

c/o Tahoe Investment Group Co., Ltd.

No. 43 Hudong Road

Olympic Building

Fuzhou City, Fujian Province, China 350003

THAIHOT Investment (Hong Kong) Company Limited is an entity organized under the laws of Hong Kong. THAIHOT Investment (Hong Kong) Company Limited is engaging in the business of investment holding and is a wholly owned subsidiary of Tahoe and the sole shareholder of THAIHOT. Its sole director is Mr. Qisen Huang.

THAIHOT Investment Company Limited

c/o Tahoe Investment Group Co., Ltd.

No. 43 Hudong Road

Olympic Building

Fuzhou City, Fujian Province, China 350003

THAIHOT Investment Company Limited, referred to herein as “THAIHOT”, is an exempted company incorporated under the laws of the Cayman Islands, an indirect wholly owned subsidiary of Tahoe and controlling stockholder of Alliance. As of the date of this proxy statement, Mr. Qisen Huang is the sole director of THAIHOT.

THAIHOT Investment Company US Limited

c/o Tahoe Investment Group Co., Ltd.

No. 43 Hudong Road

Olympic Building

Fuzhou City, Fujian Province, China 350003

THAIHOT Investment Company US Limited, referred to herein as “Parent”, is a newly formed Delaware corporation and indirect wholly owned subsidiary of Tahoe. As of the date of this proxy statement, Messrs. Qisen Huang and Yong Ge are the directors of Parent. Parent has not engaged in any business other than in connection with the merger and other related transactions.

Alliance Healthcare Services Merger Sub Limited

c/o Tahoe Investment Group Co., Ltd.

No. 43 Hudong Road

Olympic Building

Fuzhou City, Fujian Province, China 350003

Alliance Healthcare Services Merger Sub Limited, referred to herein as “Sub”, is a newly formed Delaware corporation and a wholly owned subsidiary of Parent. As of the date of this proxy statement, Messrs. Qisen Huang and Yong Ge are the directors of Sub. Sub has not engaged in any business other than in connection with the merger and other related transactions.

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The Merger Proposal

You are being asked to consider and vote upon the proposal to adopt the Merger Agreement. The Merger Agreement provides that Sub will be merged with and into the Company, and each outstanding share of Common Stock, other than shares beneficially owned by the Purchaser Group Members, Alliance, and the holders of Common Stock who have properly and validly perfected, and not effectively withdrawn or lost, their statutory appraisal rights under Delaware law (referred to as “dissenting shares”), will be converted into the right to receive $13.25 in cash per share, without interest and less any required withholding taxes.

If the merger is consummated, Alliance will become a privately held company, wholly owned by Parent. Parent will be indirectly owned and controlled by Mr. Qisen Huang.

Conditions to the Merger (Page 86)

The obligations of Alliance, on the one hand, and the Purchaser Parties, on the other hand, to consummate the merger are subject to the satisfaction (or mutual waiver by Alliance and the Purchaser Parties, if permissible under applicable law, other than the first condition below, which cannot be waived, at or before the effective time, of the following conditions:

The obligation of Alliance to effect the merger is subject to the satisfaction or waiver by Alliance, at or before the effective time, of the following conditions:

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The obligation of the Purchaser Parties to effect the merger is subject to the satisfaction or waiver by the Purchaser Parties, at or before the effective time, of the following conditions:

When the Merger Will be Completed (Page 86)

We anticipate completing the merger in the third quarter of 2017, subject to adoption of the Merger Agreement by Alliance’s stockholders as specified in this proxy statement, and the satisfaction of the other closing conditions.

Purposes and Reasons for the Merger; Recommendation of the Special Committee; Recommendation of the Board; Fairness of the Merger (Page 27)

Based in part on the unanimous recommendation of the members of a committee of independent and disinterested directors that was established by the Board (referred to as the “Special Committee”), among other things, to evaluate and negotiate a potential transaction with Tahoe, the Board unanimously (with Messrs. Qisen Huang, Heping Feng and Tao Zhang recusing themselves) determined that the Merger Agreement and the transactions contemplated by it, including the merger, are advisable and in the best interests of, and fair to, Alliance and the unaffiliated stockholders. The Board unanimously (with Messrs. Qisen Huang, Heping Feng and Tao Zhang recusing themselves) recommends that the stockholders of Alliance vote “FOR” the proposal to adopt the Merger Agreement. For a description of the reasons considered by the Special Committee and the Board for their recommendations, see “ Special Factors—Reasons for the Merger; Recommendation of the Special Committee; Recommendation of the Board; Fairness of the Merger ” beginning on page 27. For descriptions of the fairness determinations made by the Special Committee, the Board and the Purchaser Group, see “ Special Factors—Reasons for the Merger; Recommendation of the Special Committee; Recommendation of the Board; Fairness of the Merger ” beginning on page 27 and “ Special Factors—Position of the Purchaser Group as to Fairness of the Merger ” beginning on page 39.

The purpose of the merger for Alliance is to enable its stockholders to realize the value of their investment in Alliance through their receipt of the $13.25 in cash per share (referred to as the “Merger Consideration”), representing a premium of 67% over the trading price of $7.95 per share of our Common Stock on December 9, 2016, the last trading day prior to the date Tahoe’s initial proposal was publicly disclosed, and a premium of 38% over the $9.60 purchase price per share initially offered by Tahoe.

Opinion of Financial Advisor to the Special Committee (See Page 33 and Annex B)

In connection with the merger, the Special Committee’s financial advisor, Lazard, rendered its oral opinion to the Special Committee, subsequently confirmed in writing, to the effect that, as of such date and based upon and subject to the assumptions, procedures, factors, qualifications and limitations set forth in the opinion, the $13.25 per share cash Merger Consideration to be paid to the holders of Common Stock (other than shares of Common Stock held by any stockholder who properly demands appraisal rights, shares of Common Stock held by Alliance as treasury stock, or shares of Common Stock held by Purchaser Group Members (collectively, the “excluded holders”)) pursuant to the Merger Agreement was fair, from a financial point of view, to such holders.

Purchaser Group Members’ Purposes and Reasons for the Merger (Page 38)

The Purchaser Group Members believe that as a private company Alliance will have greater operating flexibility, and management will be able to more effectively concentrate on long-term growth and reduce its

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focus on the quarter-to-quarter performance often emphasized by the public markets. Moreover, Alliance will not be subject to certain obligations and constraints, and related costs, associated with having publicly traded equity securities.

Position of the Purchaser Group as to Fairness of the Merger (Page 39)

Each of the Purchaser Group Members believes that the merger is substantively and procedurally fair to Alliance’s unaffiliated stockholders. Their belief is based on the factors described in “ Special Factors—Position of the Purchaser Group as to Fairness of the Merger ” beginning on page 39.

Certain Effects of the Merger (Page 42)

If the conditions to the closing of the merger are either satisfied or, to the extent permitted, waived, Sub will be merged with and into Alliance, the separate corporate existence of Sub will cease and Alliance will continue its corporate existence under Delaware law as the surviving corporation in the merger, with all of its rights, privileges, immunities, powers and franchises continuing unaffected by the merger. Upon completion of the merger, the Common Stock, other than shares beneficially owned by the Purchaser Group Members, shares owned by Alliance, or shares owned by holders of dissenting shares, will be converted into the right to receive $13.25 per share, without interest and less any required withholding taxes. Following the completion of the merger, the Common Stock will no longer be publicly traded, and stockholders (other than the stockholders of Parent through their interest in Parent) will cease to have any ownership interest in Alliance.

Treatment of Alliance Equity Awards in the Merger (Page 76)

Options

At or immediately prior to the effective time of the merger, each option to purchase shares of Common Stock outstanding under the 1999 Equity Plan for Employees and Directors of Alliance, as amended and restated on April 27, 2016, or any other stock option, stock incentive or equity compensation plan or agreement sponsored or maintained by Alliance, referred to as “Alliance Equity Plans”, that has an exercise price per share of Common Stock underlying such option that is less than the Merger Consideration, also referred to as an “in-the-money company stock option”, whether or not exercisable or vested, shall be cancelled and converted into the right to receive an amount in cash determined by multiplying (i) the excess of the Merger Consideration over the option exercise price of such in-the-money company stock option by (ii) the number of shares of Common Stock subject to such in-the-money company stock option. At or immediately prior to the effective time, each company stock option that has an option exercise price that is equal to or greater than the Merger Consideration, whether or not exercisable or vested, shall be cancelled without payment.

Restricted Stock Units

At or immediately prior to the effective time of the merger, each award of restricted stock units with respect to shares of Common Stock granted under the Alliance Equity Plans, referred to as a “company RSU award”, that is outstanding immediately prior to the effective time, after giving effect to any accelerated vesting as a result of the transactions contemplated by the Merger Agreement, shall be cancelled and converted into the right to receive a restricted cash award in an amount in cash equal to (i) the number of shares of Common Stock subject to such company RSU award immediately prior to the effective time multiplied by (ii) the Merger Consideration.

Interests of Alliance’s Directors and Executive Officers in the Merger (Page 54)

In considering the recommendations of the Special Committee and of the Board with respect to the Merger Agreement, you should be aware that, aside from their interests as stockholders of Alliance, Alliance’s directors

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and executive officers have interests in the merger that may be different from, or in addition to, those of other stockholders of Alliance generally. In particular, Mr. Qisen Huang, as the controlling owner of Tahoe, will indirectly control Alliance following the merger. Interests of executive officers and directors that may be different from or in addition to the interests of Alliance’s stockholders include:

The Special Committee and the Board were aware of the different or additional interests described in this proxy statement and considered those interests along with other matters in recommending and/or approving, as applicable, the Merger Agreement and the transactions contemplated by it.

Regulatory Matters (Page 59)

No material federal or state regulatory approvals, filings or notices are required in connection with the merger other than the filing of an overseas investment registration with the NDRC by the applicable Purchaser Parties and the filing of a certificate of merger with the Secretary of State of the State of Delaware by the Company and Sub.

Termination (Page 87)

Alliance and Parent may terminate the Merger Agreement by mutual written consent at any time before the effective time, whether prior to or after receipt of the requisite stockholder approval. In addition, either Alliance or Parent (as applicable) may terminate the Merger Agreement, subject to various exceptions described under “The Merger Agreement — Termination,” if:

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Parent may terminate the Merger Agreement if there is a breach or failure of any representation, warranty, covenant or agreement of the Company, which breach or failure has given rise to or would reasonably be likely to give rise to the failure of a condition to the Purchaser Parties’ obligations to complete the merger, and such condition would not be capable of being satisfied prior to the Termination Date, or if capable of being satisfied, the failure of the condition is not cured within 30 business days following receipt of written notice from Parent.

Alliance may terminate the Merger Agreement if:

Expense Reimbursement Provisions (Page 88)

Alliance is required to pay Parent an amount equal to $1,500,000 (referred to as the “Alliance Expense Reimbursement”) in the event that Alliance or Parent terminates the Merger Agreement following the Board or Independent Committee’s Change in Recommendation.

Parent is required to pay Alliance an amount equal to $4,500,000 (referred to as the “Parent Expense Reimbursement”) under the following circumstances:

Specific Performance (Page 89)

Under certain circumstances, Alliance and the Purchaser Parties are entitled to specific performance of the terms of the Merger Agreement, in addition to any other remedy at law or equity.

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Financing (Page 53)

Alliance and the Purchaser Parties estimate that the total amount of funds required to complete the merger and related transactions and pay related fees and expenses will be approximately $75 million. The Purchaser Parties intend to fund this amount from cash on hand (as further described in “ Special Factors—Financing ”).

Material U.S. Federal Income Tax Consequences of the Merger (Page 56)

If you are a U.S. holder, the receipt of cash in exchange for Common Stock pursuant to the merger will generally be a taxable transaction for U.S. federal income tax purposes. You should consult your own tax advisors regarding the particular tax consequences to you of the exchange of Common Stock for cash pursuant to the merger in light of your particular circumstances (including the application and effect of any state, local or foreign income and other tax laws).

The Annual Meeting (Page 70)

The annual meeting will be held at the Company’s corporate headquarters located at 18201 Von Karman Avenue, Suite 600, Irvine, California 92612, on [●], 2017, beginning at 9:00 a.m. Pacific time.

Record Date and Quorum (Page 70)

The holders of record of the Common Stock as of the close of business on [●], 2017 (the record date for determination of stockholders entitled to notice of and to vote at the annual meeting) are entitled to receive notice of and to vote at the annual meeting.

The presence at the annual meeting, in person or by proxy, of the holders of a majority of shares of Common Stock outstanding on the record date and entitled to vote will constitute a quorum, permitting the Company to conduct its business at the annual meeting.

Required Votes (Page 71)

For the Company to complete the merger, under Delaware law, stockholders holding at least a majority in aggregate voting power of the Common Stock outstanding at the close of business on the record date must vote “FOR” the adoption of the Merger Agreement. In addition, it is a condition to the consummation of the merger that stockholders holding at least a majority of shares of outstanding Common Stock at the close of business on the record date and not owned by the Purchaser Group Members or Section 16 Officers must vote “FOR” the adoption of the Merger Agreement.

Litigation (Page 64)

On May 5, 2017 and May 15, 2017, the Company received letter from two purported stockholders demanding inspection of the Company’s books, records, and other documents under Section 220 of the DGCL (together, the “Demands”). The Demands allege mismanagement and other wrongdoing on the part of the Board in approving the Merger, and contend that such mismanagement constitutes a breach of the Board’s fiduciary duties. The Company believes that the allegations in each Demand are meritless and intends to defend vigorously against any litigation that might be filed in connection with the allegations.

Dissenters’ Rights of Appraisal (Page 60 and Annex C)

Alliance stockholders who do not vote in favor of adoption of the Merger Agreement, who properly demand appraisal of their shares of Common Stock and who otherwise comply with all the requirements of Section 262 of the General Corporation Law of the State of Delaware (the “DGCL”) will be entitled to seek appraisal for, and obtain payment in cash for the judicially determined fair value of, their shares of Common Stock in lieu of receiving the Merger Consideration if the merger is completed. In addition to not voting in favor of the merger, the stockholder must deliver to Alliance a written demand for appraisal of such stockholder’s shares prior to the vote on the Merger Agreement and continue to hold such shares until the consummation of the merger.

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QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING AND THE MERGER

The following questions and answers address briefly some questions you may have regarding the annual meeting, the Merger Agreement and the merger. These questions and answers may not address all questions that may be important to you as a stockholder of Alliance. Please refer to the more detailed information contained elsewhere in this proxy statement, the annexes to this proxy statement and the documents referred to or incorporated by reference in this proxy statement.

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SPECIAL FACTORS

Background of the Merger

The Company’s Board and management team regularly review the Company’s long-term strategic plan, operational and financial performance, industry conditions, regulatory developments and potential opportunities with the goal of enhancing stockholder value. As part of these efforts, the Board and Company management review strategic alternatives regarding the operation of the business under its current long-term strategic plans, including potential business combinations, a sale of all or a portion of the Company, potential acquisitions, financings and other transactions with third parties. The Company did not enter into any confidentiality agreements with Tahoe or Party X, in connection with the discussions described below, and, except for the Governance Agreement described in more detail below, is not a party to any confidentiality agreement with a standstill provision which would prevent a party from making an offer to acquire the Company or the Minority Interest.

On March 29, 2016, THAIHOT, a wholly-owned indirect subsidiary of Tahoe (formerly known as Fujian Thai Hot Investment Co., Ltd.), completed its purchase of 5,537,945 shares of Common Stock from funds managed by Oaktree Capital Management, L.P. (OCM Principal Opportunities Fund IV, L.P. and Alliance-Oaktree Co-Investors, LLC) and MTS Health Investors, LLC, (MTS Health Investors II, L.P., Alliance-MTS Co-Investors I, LLC and Alliance-MTS Co-Investors II, LLC), and Larry C. Buckelew for approximately $102.5 million (the “2016 Acquisition”). As a result of the 2016 Acquisition, THAIHOT acquired approximately 51.5% of the outstanding shares of the Company. In connection with the 2016 Acquisition, Tahoe and THAIHOT entered into the Governance Agreement, pursuant to which, for a period of three (3) years from the date of the closing of the 2016 Acquisition, among other terms, conditions and limitations, (i) THAIHOT and its affiliates are prohibited from acquiring additional shares of Common Stock without the prior consent of a majority of the Board’s directors who were unaffiliated with Tahoe, THAIHOT and their affiliates, and (ii) THAIHOT will have the right, for so long as it beneficially owns at least 35% of the Company’s outstanding Common Stock, to nominate for election to the Board the number of directors necessary to comprise a majority of the Board (the “Designated Representatives”). Pursuant to the Governance Agreement, Tahoe has chosen to nominate three (3) of the nine (9) directors as the Designated Representatives who are currently Mr. Qisen Huang, Mr. Heping Feng and Dr. Tao Zhang.

In connection with the 2016 Acquisition, the Board formed a special committee of independent and disinterested directors consisting of Neil F. Dimick, Paul S. Viviano and Edward L. Samek (the “Former Independent Committee”). At that time, the Former Independent Committee formally engaged O’Melveny & Myers LLP (“O’Melveny”) to serve as its independent legal advisor and Richards, Layton & Finger, P.A. (“RLF”) to serve as its independent legal counsel with respect to Delaware law matters. The Former Independent Committee did not engage a financial advisor in connection with the 2016 Acquisition.

On August 15, 2016, Mr. Tomlinson met with the chief executive officer and chief financial officer of a publicly traded healthcare services company based in the United States (“Party X”) to discuss each party’s business and strategic initiatives. During this conversation, the chief executive officer of Party X expressed an interest in exploring a potential acquisition of the outstanding shares of the Common Stock not held by THAIHOT (the “Minority Interest”) and asked Mr. Tomlinson to coordinate a meeting between representatives of Tahoe and Party X to discuss the possibility of an acquisition by Party X of the Minority Interest. Party X did not provide a price at which it might be willing to acquire the Minority Interest.

On August 24, 2016, the Board held a telephonic meeting, at which Mr. Huang, Mr. Feng and Dr. Zhang were present, which was also attended by Messrs. Tomlinson and Johns. During the meeting, Mr. Tomlinson provided a summary of his meeting with Party X, including the request by the chief executive officer of Party X for a meeting with the representatives of Tahoe, and the Board discussed a potential acquisition of the Minority Interest by Party X. The participants in the meeting noted that it would be very difficult to structure an acquisition by Party X of all of the outstanding Minority Interest without cooperation from Tahoe. During the discussion, the Designated Representatives informed the Board that Tahoe would be interested in meeting with Party X to discuss a potential acquisition of the Minority Interest by Party X, and the Designated Representatives

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also informed the other members of the Board that if Party X were to pursue an acquisition of the Minority Interest, Tahoe may be interested in investing additional capital into the Company in connection with the acquisition. The Designated Representatives did not provide a price or any other terms regarding a potential investment in the Company or participation in an acquisition of the Minority Interest with Party X. Following further discussion at the Board meeting, the Board asked Mr. Tomlinson to prepare a potential response to Party X seeking additional information concerning a potential acquisition of the Minority Interest. Also, in advance of this Board meeting, Company management provided the Board with the August Long-Range Planning Model. See “ Special Factors—Projected Financial Information ” beginning on page 44.

On August 29, 2016, following further communications with members of the Board after the August 24, 2016 Board meeting, Mr. Tomlinson communicated with the chief financial officer of Party X and indicated that the Board was supportive of exploring a proposal from Party X to acquire the Minority Interest and requested that Party X provide the price it would be willing to pay for the Minority Interest and other detail regarding the material terms of any acquisition of the Minority Interest. The chief financial officer of Party X informed Mr. Tomlinson that Party X remained interested in a potential acquisition of the Minority Interest and again asked Mr. Tomlinson to coordinate a meeting between representatives of Tahoe and Party X to discuss the possibility of an acquisition by Party X of the Minority Interest. Party X did not provide a price at which it might be willing to acquire the Minority Interest or any other terms of a potential acquisition.

On September 16, 2016, ahead of a regularly scheduled meeting of the Board on September 19 and 20, 2016, Mr. Tomlinson spoke with the chief financial officer of Party X by telephone in order to attempt to gauge Party X’s level of interest in a potential acquisition of the Minority Interest. During their conversation, the chief financial officer of Party X informed Mr. Tomlinson that Party X remained interested in exploring the possibility of an acquisition by Party X of the Minority Interest but did not provide a price at which Party X might acquire the Minority Interest, and no other terms of a potential transaction involving Party X and the Company were discussed.

On September 19 and 20, 2016, the Board held a regularly scheduled meeting in Beijing, in the People’s Republic of China (the “PRC”), at which Mr. Huang, Mr. Feng and Dr. Zhang were present. Mr. Tomlinson updated the Board with respect to the discussions that had taken place between himself and the chief financial officer of Party X. Mr. Tomlinson noted that, Party X had not yet made any proposal to acquire the Minority Interest and that Party X had again requested that Company management coordinate a meeting between representatives of Tahoe and Party X to discuss the possibility of an acquisition by Party X of the Minority Interest prior to Party X submitting any proposal. The Board discussed the potential merits and risks of a potential transaction with Party X versus the Company remaining a publicly traded corporation, and, following such discussions, authorized Company management to continue discussions with Party X regarding a potential acquisition of the Minority Interest and directed the Company management to assist in setting up a meeting between Party X and Tahoe. At the Board meeting, a Designated Representative inquired if Tahoe would be permitted to explore an acquisition of the Minority Interest. The Board noted that Tahoe would need to first obtain a waiver from the unaffiliated members of the Board as provided under the Governance Agreement prior to making a proposal to acquire the Minority Interest, and that such a transaction would constitute a “going-private” transaction that would require careful review and consideration by the Company’s independent and disinterested directors. Tahoe did not discuss a price at which it might be willing to acquire the Minority Interest, and no other terms of a potential transaction involving Tahoe and the Company were discussed at this time.

Following the September 19 and 20, 2016 Board meeting and in response to Tahoe’s inquiry as to the possibility of exploring a potential going private transaction with the Company at that meeting, the members of the Former Independent Committee, after discussions with other members of the Board not affiliated with Tahoe, discussed convening the Former Independent Committee together with other independent and disinterested members of the Board in order to review, evaluate and, if necessary, negotiate any potential transaction with Tahoe, Party X or any other potential third party purchaser of some or all of the Common Stock. The members of

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the Former Independent Committee, following discussions with other members of the Board not affiliated with Tahoe, O’Melveny and RLF, determined that a re-constituted special committee should consist of Neil F.

Dimick, Paul S. Viviano, Edward L. Samek (each a member of the Former Independent Committee) and Scott A. Bartos, each an independent and disinterested director of the Company (collectively, the “Special Committee”). The Special Committee, in consultation with the other members of the Board, determined to begin functioning immediately, with the understanding that the members of the Special Committee would work with independent legal counsel of their choosing to propose formal resolutions to the full Board setting out the Special Committee’s mandate in more detail, and that the Special Committee would be formally created if and when discussions with Party X, Tahoe or any other third party purchaser of the Company or the Minority Interest began to materialize beyond mere indications of potential interest. Following additional discussion, the members of the Special Committee determined to again engage O’Melveny as its independent legal advisor and RLF as its independent legal advisor with respect to Delaware law issues.

On October 6, 2016, representatives of O’Melveny, on behalf of the Special Committee, emailed to the Company’s general counsel proposed resolutions and a charter for the Special Committee setting out in detail the Special Committee’s mandate. Pursuant to those resolutions, the Special Committee was authorized to, among other authority, conduct the investigation, evaluation and negotiation of a potential transaction with Party X, Tahoe or any other potential purchaser of all or part of the outstanding shares of the Common Stock, evaluate, negotiate and make recommendations to the Board for or against, and to the extent delegable by the Board, approve (or not approve), the terms of any proposed definitive agreements, arrangements, waivers (including with respect to the Governance Agreement) or consents entered into or given by the Company in respect of a potential strategic transaction between Tahoe and the Company or involving a third party purchaser (or Tahoe) of all or part of the outstanding shares of the Common Stock or any other strategic alternatives thereto, or to determine, in its sole discretion, to elect not to pursue any such potential strategic transaction, and to retain its own independent legal and financial advisors at the Company’s expense. In addition, the resolutions and Special Committee charter stated that the Board would not approve any transaction with Party X, Tahoe or any other potential purchaser of all or part of the outstanding shares of the Common Stock without a favorable recommendation from the Special Committee. The full Board subsequently adopted such resolutions and the Special Committee charter by written consent on December 12, 2016. Also, pursuant to the resolutions, Mr. Neil F. Dimick was appointed as the Chair of the Special Committee (the “Chair”) based upon, among other things, his communication skills and familiarity with the administration of the Company, the fact that he had no connection to Tahoe, and his role as Chair of the Former Independent Committee.

On October 7, 2016, the Special Committee held an initial telephonic meeting, which was also attended by Messrs. Tomlinson and Johns from the Company and representatives of O’Melveny and RLF. At this meeting, Mr. Tomlinson updated the Special Committee on the status of discussions with Party X. Mr. Tomlinson noted that Party X had not yet made any proposal to acquire the Minority Interest, but that, at the request of Party X and the Board, Mr. Tomlinson had been in contact with Party X and Tahoe to help facilitate a meeting between the two parties to discuss a potential acquisition of the Minority Interest by Party X. Mr. Tomlinson noted that the meeting between Party X and Tahoe had been tentatively scheduled for November. The Special Committee, along with representatives of O’Melveny and RLF, also discussed the formation of the Special Committee and the duties and responsibilities of the Special Committee. In addition, the Special Committee, along with representatives of O’Melveny and RLF, discussed the importance of engaging an independent financial advisor in the event that the Company received a proposal regarding an acquisition of the Minority Interest.

On November 7, 2016, Mr. Tomlinson, representatives from Tahoe, and representatives from Party X met to discuss the interest Party X had expressed in acquiring the Minority Interest. During the meeting, Party X expressed reduced interest in continued discussions regarding a potential acquisition of the Minority Interest due to the increase of the Company’s share price on NASDAQ since Party X first considered the acquisition of the Minority Interest, and Party X’s determination to focus on other potential strategic opportunities with third parties that would involve a controlling ownership for Party X. Party X indicated it may follow up with the Company in early 2017. Following the discussion on November 7, 2016, there was no further communication

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between Party X and the Company regarding a potential acquisition of the Minority Interest by Party X. Party X never submitted a proposal to acquire the Minority Interest and never discussed price or other terms with the Company or its representatives.

On November 9, 2016, the Board held a telephonic meeting, in which Mr. Huang, Mr. Feng and Dr. Zhang participated. The meeting was also attended by Messrs. Tomlinson and Johns and Ms. Longmore-Grund. Mr. Tomlinson updated the Board with respect to the meeting that had taken place on November 7, 2016, between representatives of Party X and Tahoe, which had been organized as requested by Party X. Mr. Tomlinson noted that Party X had expressed reduced interest in continued discussions regarding a potential acquisition of the Minority Interest. During the meeting, a Designated Representative mentioned that Tahoe would be interested in exploring the possibility of acquiring the Minority Interest, but did not discuss a price at which Tahoe might be willing to acquire the Minority Interest, and no other terms of a potential acquisition of the Minority Interest by Tahoe were discussed at this time.

On November 10, 2016, Mr. Feng indicated in an email to Mr. Buckelew and Mr. Tomlinson that Tahoe had reviewed materials prepared for the November 9, 2016 Board meeting, that Mr. Feng had discussed the materials with Mr. Huang, and that Tahoe was supportive of the Company’s strategic plan. Further, Mr. Feng’s email indicated that Tahoe would be willing to work with the Special Committee to explore the possibility of acquiring the Minority Interest.

On November 11, 2016, the Special Committee held a telephonic meeting, which was also attended by Messrs. Tomlinson and Johns and representatives of O’Melveny and RLF. At this meeting, Mr. Tomlinson updated the Special Committee on the status of discussions with Party X. Mr. Tomlinson informed the Special Committee that he had not had further discussions with Party X following the meeting held between himself, Tahoe and Party X on November 7, 2016 and, it was his belief that, based on discussions with Party X during that meeting, that Party X did not intend to pursue a potential transaction with the Company as Party X was currently pursuing certain strategic initiatives that were being prioritized over its exploration of a potential transaction with the Company and a potential transaction with the Company had become less attractive for Party X due to the increase in the trading price of the Common Stock on NASDAQ since Mr. Tomlinson’s August 15, 2016 meeting with the chief executive officer of Party X. Mr. Tomlinson also informed the Special Committee that, based on Mr. Feng’s email on November 10, 2016, Tahoe was interested in exploring the possibility of pursuing a potential going private transaction involving the Company, but no price or other terms had been proposed or discussed. After discussion, representatives of O’Melveny and RLF discussed with the Special Committee the Special Committee’s fiduciary duties to the Company’s stockholders should Tahoe seek consent to submit an acquisition proposal. The Special Committee, O’Melveny and RLF discussed Tahoe’s potential interest in a going private transaction, Delaware law considerations in any going private transactions, the Special Committee’s role should negotiations ensue and the process by which the Special Committee would evaluate such a proposal, including the engagement of an independent financial advisor. Following discussion, the Special Committee instructed the members of the Company’s management present on the call to refrain from discussing any potential post-transaction positions with the Company or what role members of management may play in the future. The Special Committee requested that Mr. Tomlinson confirm, if possible, whether or not Tahoe remained interested in discussing a potential acquisition of the Minority Interest.

On November 16-18, 2016, Company management, including Mr. Tomlinson, met with representatives of Tahoe in Beijing, PRC, to discuss the Company’s operations and financial performance during the previous few months. On the last day of the meetings, November 18, 2016, Mr. Tomlinson met with Mr. Huang. During the meeting, Mr. Tomlinson discussed with Mr. Huang the possibility of Tahoe acquiring the Minority Interest and the potential impact on the Company’s business if it were no longer a publicly traded Company. Mr. Huang noted to Mr. Tomlinson that Tahoe remained interested in exploring potential strategic alternatives involving the Company, including the possibility of taking the Company private by acquiring all of the Minority Interest.

On November 18, 2016, Tahoe engaged Skadden, Arps, Slate, Meagher & Flom LLP (“Skadden”) to serve as its U.S. legal counsel to assist its strategic review of any potential transaction involving the Company.

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On November 29, 2016, the Special Committee held a telephonic meeting, which was also attended by Messrs. Tomlinson and Johns and representatives of O’Melveny and RLF. At this meeting, Mr. Tomlinson provided an update regarding his November 16-18, 2016 meetings with Tahoe in Beijing, PRC and Mr. Tomlinson informed the Special Committee that he had received an email from a representative of Tahoe explaining that the foreign exchange regulatory authorities in the PRC had recently put in place new regulations that could make the transfer of funds out of the PRC more difficult. The email went on to note that Tahoe would need to better understand these regulations before it could make a determination as to whether it would be willing to submit a proposal to the Company regarding a potential acquisition of the Minority Interest. Mr. Tomlinson also noted that other than receipt of the email from Tahoe and the conversation he had with Mr. Huang on November 18, 2016, he had not had any discussions with Tahoe regarding an acquisition of the Minority Interest since the Special Committee’s last meeting on November 11, 2016. After discussion, the Special Committee discussed the advisability of selecting an independent financial advisor in advance of Tahoe’s determination as to whether it would seek consent of the Special Committee to make a proposal regarding a potential acquisition of the Minority Interest so that the Special Committee would be in a position to move quickly to evaluate such a proposal in the event it was ultimately made. The Special Committee then discussed various investment banking firms that could potentially serve as the Special Committee’s independent financial advisor. After discussion, the Special Committee selected three investment banking firms (one of which was Lazard) that it considered to be well qualified and which, to its knowledge, would be independent, to act as a financial advisor to the Special Committee, and determined to contact each potential independent financial advisor to inquire as to whether each such firm would be interested in submitting a proposal to advise the Special Committee in the event of receipt of a proposal from Tahoe.

During the weeks of November 28, 2016 and December 5, 2016, representatives and members of the Special Committee contacted the three potential independent financial advisors previously vetted by the Special Committee. After discussing the potential acquisition of the Minority Interest by Tahoe and the fees that the Special Committee considered reasonable and appropriate in connection with retaining a financial advisor for the Special Committee, one of the financial advisors elected not to submit a proposal. The remaining two potential independent financial advisors indicated their interest in making a proposal. The Special Committee asked each of them to disclose any conflicts of interest such financial advisor might have with respect to the potential engagement and a potential acquisition of the Minority Interest by Tahoe. Each of the remaining two independent financial advisors confirmed for the Special Committee that there were no conflicts of interest of such financial advisor with respect to the potential engagement or a potential acquisition of the Minority Interest by Tahoe.

On December 8, 2016, the Board received a written non-binding proposal from Tahoe to pursue a potential negotiated acquisition of the Minority Interest for $9.60 per share in cash (as subsequently amended, the “Tahoe Proposal”). The Tahoe Proposal stated that Tahoe was submitting its proposal subject to the granting by the unaffiliated directors of the Board of a waiver of any relevant provisions of the Governance Agreement that would otherwise prohibit, prevent or hinder Tahoe from making its proposal and from making a public announcement thereof and requested that the unaffiliated directors grant such a waiver. The $9.60 proposal reflected a premium of 20.0% over the closing price of the Common Stock on December 8, 2016, the date of the Tahoe Proposal, and 30.0% over the volume weighted average closing price of the Common Stock for the 90 calendar days prior to the date of the Tahoe Proposal. The Tahoe Proposal stated, among other things, that Tahoe would not move forward with the proposal unless it was approved by a special committee of independent directors of the Company that was advised by independent legal counsel and independent financial advisors, and that the transaction would be subject to a non-waivable condition requiring approval of a majority of the unaffiliated shares. In addition, the Tahoe Proposal stated that Tahoe and its affiliates were interested only in acquiring the Minority Interest, and that they were not interested in selling their shares of Common Stock to a third party and did not expect, in their capacity as stockholders of the Company, to vote in favor of any merger or other strategic transaction involving any third party.

On December 9, 2016, the Special Committee held a telephonic meeting with O’Melveny, RLF and Company management to discuss the material terms of the Tahoe Proposal and the merits and risks of providing the limited waiver of certain provisions under the Governance Agreement that had been requested by Tahoe to

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permit the offer to be formally submitted to the Special Committee. After Company management left the meeting, the Special Committee considered the risks that the Tahoe Proposal would distract management from the operation of the business and that the Company may incur significant fees and expenses in evaluating the Tahoe Proposal for which it may not be reimbursed. In addition, the Special Committee considered the risk that if the Tahoe Proposal was announced, but not consummated, the Company’s stock price could be negatively impacted. The Special Committee also considered the merits of granting the requested waiver, including the fact that the price of $9.60 per share represented a 20% premium to the Company’s stock price on December 8, 2016, the day the Tahoe Proposal was submitted, and that Tahoe’s initial offer likely represented the starting point for negotiations and that the final price per share at which the Tahoe Proposal may be approved could be meaningfully higher. The Special Committee also noted that, although upon initial review, the price of $9.60 per share seemed to undervalue the Company, it had not yet engaged a financial advisor to help it evaluate the fairness, from a financial point of view, of the Tahoe Proposal. The Special Committee also reviewed with its advisors potential responses to Tahoe and potential communications with the Company’s stockholders. Ultimately, the Special Committee determined that it was consistent with its fiduciary duties to consider the Tahoe Proposal in order to evaluate whether it was in the best interests of the Company and the holders of unaffiliated shares, and resolved to grant a waiver of the Governance Agreement for the limited purpose of permitting Tahoe to submit the Tahoe Proposal to the Special Committee so that the Special Committee could further evaluate the Tahoe Proposal. Following discussion, representatives of O’Melveny informed the Special Committee that Company management had been reminded that they should not discuss post-transaction employment matters and avoid discussing the terms of any potential transaction with Tahoe, without the Special Committee’s prior written consent. The Special Committee also discussed whether or not it was appropriate or useful to reach out to other potential investors in connection with a potential acquisition of the Company or the Minority Interest given the statement by Tahoe in the Tahoe Proposal that Tahoe and its affiliates were interested only in acquiring the Minority Interest, and that they were not interested in selling their shares of Common Stock to a third party and did not expect, in their capacity as stockholders of the Company, to vote in favor of any merger or other strategic transaction involving any third party. After discussion, the Special Committee determined that, based on the statement from Tahoe, any potential purchaser would only be able to acquire the Minority Interest (given Tahoe’s majority ownership of the Company and the fact that Tahoe had stated it was unwilling to sell its ownership interest in the Company), and then only with the cooperation of Tahoe, and therefore that any efforts to reach out to other third parties at this time to determine whether those third parties might be interested in an acquisition of the Company or the Minority Interest would be futile and not a prudent use of Company resources. In addition, the Special Committee determined to revisit its decision not to reach out to other third parties once it had engaged an independent financial advisor.

On December 12 and 13, 2016, the Board held a regularly scheduled meeting at its corporate offices in Newport Beach, California, which Mr. Huang, Mr. Feng and Dr. Zhang attended via video conference. During this meeting, Company management updated the Board on the Company’s operations and strategic plans by division as well as for the Company as a whole. Also, Company management reviewed with the Board, and the Board approved, unaudited financial projections for fiscal year 2017. See “ Special Factors—Projected Financial Information ” beginning on page 44.

On December 12, 2016, the Company, at the request of the Special Committee, issued a press release publicly announcing the receipt of the Tahoe Proposal, and filed the press release as an exhibit to its Current Report on Form 8-K. The press release also stated that the Board had authorized the Special Committee to evaluate the Tahoe Proposal and that the Special Committee had agreed to waive certain provisions of the Governance Agreement for the limited purpose of allowing Tahoe to submit its proposal to the Special Committee.

Later that same day, the Special Committee met in person at the Company’s headquarters with representatives of Company management and representatives from O’Melveny and RLF (who participated telephonically). The representatives of Company management in attendance left the meeting after providing the Special Committee a brief update as to stockholder reactions to the Tahoe Proposal received by the Company.

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O’Melveny reviewed with the Special Committee its fiduciary duties in connection with the Tahoe Proposal. RLF reviewed with the Special Committee certain Delaware law considerations related to the Tahoe Proposal. The Special Committee considered the regulatory approvals that may be required in connection with the Tahoe Proposal and how Tahoe’s method of financing may impact any regulatory approvals required to consummate the Tahoe Proposal, specifically in the PRC. Representatives from an investment bank (“Financial Advisor Y”) joined the meeting and presented their proposal to serve as independent financial advisor to the Special Committee. Following Financial Advisor Y’s presentation, and after the representatives of Financial Advisor Y left the meeting, representatives from Lazard Frères & Co. LLC (“Lazard”) joined the meeting and presented their proposal to serve as independent financial advisor to the Special Committee. The Special Committee conducted interviews with each firm regarding their experience with going private transactions and transactions involving PRC based purchasers, potential conflicts of interest, their preliminary thoughts regarding the Tahoe Proposal and their proposed fee structure. After Lazard left the meeting, the Special Committee reviewed the presentations and discussed the perceived strengths and benefits of each advisor, including each advisor’s reputation, proposed fee structure, potential conflicts of interest, capabilities and experience in the Company’s industry, going private transactions and cross-border transactions involving the PRC.

On December 13, 2016, Tahoe and certain of its affiliates filed an amendment to their Schedule 13D to disclose the terms of the Tahoe Proposal.

On December 15, 2016, the Special Committee held a telephonic meeting, which was also attended by Messrs. Tomlinson and Johns and representatives of O’Melveny and RLF. The Special Committee, together with Messrs. Tomlinson and Johns and representatives of O’Melveny and RLF, discussed the Tahoe Proposal and how it may impact the Company’s operations. The Special Committee discussed the status of discussions with Lazard and Financial Advisor Y and asked Messrs. Tomlinson and Johns for their opinions regarding each potential financial advisor and whether or not they were aware of any conflicts of interest with each potential financial advisor. Messrs. Tomlinson and Johns informed the Special Committee they were not aware of any conflicts. After Company management left the meeting, the Special Committee again reviewed the strengths and benefits of the two potential financial advisors but did not make a final decision at this time, as the Special Committee was still discussing and negotiating the fee structure for the financial advisors.

On December 16, 2016, the Special Committee met telephonically with representatives from O’Melveny and RLF to discuss the status of discussions with Lazard and Financial Advisor Y. The Special Committee again considered the advantages and disadvantages of each financial advisor, but did not make a final decision at this time, as the Special Committee was still discussing and negotiating Lazard’s proposed fee structure.

On December 20, 2016, the Special Committee met telephonically with representatives from O’Melveny and RLF. Mr. Dimick updated the Special Committee regarding recent discussions he had with Lazard regarding its proposed fee structure. After considering Lazard’s knowledge and expertise in mergers and acquisitions transactions, experience advising special committees in going private transactions and experience in cross-border transactions with PRC based entities and after Lazard’s confirmation that there were no conflicts of interest present that would affect Lazard’s ability to effectively provide advice to the Special Committee, the Special Committee determined to engage Lazard as its independent financial advisor and executed an engagement letter with Lazard on the same day.

On January 6, 2017, the Special Committee met telephonically with representatives from O’Melveny, RLF and Lazard to discuss the process by which Lazard would gather information from the Company and to discuss a preliminary timeline for the Special Committee’s evaluation of the Tahoe Proposal. Lazard noted for the Special Committee that, consistent with its past practice, the Company had prepared the December Long-Range Planning Model in conjunction with the annual financial and operating planning process, and that such December Long Range Planning Model had not been approved by the Board (other than with respect to the unaudited financial projections for fiscal year 2017). See “ —Projected Financial Information ” beginning on page 44. The Special Committee instructed Lazard to coordinate with Company management, under the Special Committee’s supervision, to have the Company prepare an alternative scenario of unaudited financial projections (the “Special

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Committee Forecasts”) based on the December Long- Range Planning Model with certain adjustments with respect to the Company’s projected financial performance requested by the Special Committee, the most significant being the elimination of the impacts of any potential acquisitions in the December Long-Range Planning Model that were projected for fiscal years 2018 and beyond. See “ Special Factors—Projected Financial Information ” beginning on page 44. The Special Committee, together with representatives from O’Melveny, RLF and Lazard, also discussed whether or not it was appropriate or useful to reach out to other potential third party acquirers of the Company or the Minority Interest in connection with the Special Committee’s evaluation of the Tahoe Proposal given the statement by Tahoe in the Tahoe Proposal that Tahoe and its affiliates were interested only in acquiring the Minority Interest, and that they were not interested in selling their shares of Common Stock to a third party and did not expect, in their capacity as stockholders of the Company, to vote in favor of any merger or other strategic transaction involving any third party. After discussion, the Special Committee determined that, based on the statement from Tahoe, any potential purchaser would only be able to acquire the Minority Interest (given Tahoe’s majority ownership of the Company and the fact that Tahoe had stated it was unwilling to sell its ownership interest in the Company), and then only with the cooperation of Tahoe, and therefore that any efforts to reach out to other third parties at this time to determine whether those third parties might be interested in an acquisition of the Company or the Minority Interest would be futile and not a prudent use of Company resources.

On January 11, 2017, the Special Committee met telephonically with Messrs. Tomlinson and Johns and Ms. Longmore-Grund, O’Melveny, RLF and Lazard to discuss process and next steps with respect to evaluating the Tahoe Proposal, the status of Lazard’s due diligence on the Company and the status of Company management’s preparation of the Special Committee Forecasts.

On January 16, 2017, the Special Committee held a telephonic meeting at which Messrs. Tomlinson and Johns and Ms. Longmore-Grund, O’Melveny and RLF were in attendance. Company management discussed the status of the Special Committee Forecasts with the Special Committee, including the underlying assumptions, sensitivities and uncertainties. Representatives of Company management also updated the Special Committee on management’s consideration of a potential refinancing of the Company’s credit facility and noted that the Company’s financial advisors had advised Company management that execution of a refinancing would be more difficult while uncertainty over the Tahoe Proposal remained.

On January 17, 2017, the Special Committee met telephonically, along with Messrs. Tomlinson and Johns and Ms. Longmore-Grund, O’Melveny, RLF and Lazard, to review and discuss the status of Lazard’s financial review of the Tahoe Proposal and to approve the Special Committee Forecasts for use by Lazard in connection with its valuation analysis of the Company and the Tahoe Proposal. The Special Committee Forecasts had been provided to the Special Committee in advance of the meeting. After a review of the Special Committee Forecasts by management and Lazard and discussion of the Special Committee Forecasts, the representatives of Company management left the meeting, and the Special Committee discussed the Tahoe Proposal with its advisors. Lazard discussed with the Special Committee certain assumptions and valuation methodologies of its preliminary valuation analysis of the Company and the Tahoe Proposal. The Special Committee then discussed the long-term prospects of the Company, the need for the Company to refinance its existing debt before the applicable maturities (and the estimated increase in the Company’s cost of capital that would result), the likelihood of successfully implementing future potential acquisitions and cost savings initiatives. In addition, the Special Committee concluded that an acquisition of the Company or the Minority Interest by a third party was not viable due to the fact that Tahoe would be required to sell their ownership interest in the Company (which Tahoe had stated that they were unwilling to do) and a sale of the Minority Interest to a third party would only be possible with the cooperation of Tahoe. After discussion and taking into account the foregoing, the Special Committee determined that Tahoe’s proposal of $9.60 per share undervalued the Company and determined to schedule a meeting with Tahoe so that the Special Committee could inform Tahoe of its decision and let Tahoe know that it would need to meaningfully increase its proposal of $9.60 per share in order for the potential transaction to move forward.

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On January 20, 2017, the Special Committee met telephonically with representatives from O’Melveny, RLF and Lazard. Lazard updated the Special Committee on the status of its financial review of the Company, noting that it was waiting for additional information from Company management before it could finalize its valuation analysis of the Company and the Tahoe Proposal. After discussion, the Special Committee discussed its upcoming videoconference with Tahoe, which had been scheduled for January 22, 2017. Also on January 20, 2017, representatives of Tahoe received the Special Committee Forecasts and the December Long-Range Planning Model from the Company.

On January 22, 2017, the Special Committee and representatives from O’Melveny and RLF held a videoconference with representatives from Tahoe and Skadden, Tahoe’s outside legal counsel. The Special Committee informed Tahoe that Tahoe would need to meaningfully increase its proposal of $9.60 per share in order for the potential transaction to move forward. The Special Committee did not provide a counterproposal at this time in light of its ongoing financial review of the Company, but advised Tahoe that its revised proposal should be increased to the mid to high teens per share or more.

On January 26, 2017, at the direction of the Special Committee, representatives from Lazard met telephonically with representatives from Tahoe to discuss certain assumptions and valuation methodologies being used by Lazard in its preliminary valuation analysis of the Company. The purpose of this discussion was for Lazard to help Tahoe’s representatives understand, from a technical perspective, the potential reasons for the valuation gap between Tahoe’s internal valuation analysis of the Company and the Special Committee’s insistence on a meaningful price increase.

On January 27, 2017, the Special Committee held a telephonic meeting, at which representatives from O’Melveny, RLF and Lazard were in attendance. Representatives of Lazard updated the Special Committee with respect to Lazard’s recent teleconference with representatives of Tahoe, noting that Tahoe stated it believed its proposal of $9.60 per share fairly valued the Company. After discussion, Lazard updated the Special Committee on the status of its ongoing financial review of the Company. The Special Committee discussed next steps with respect to the Tahoe proposal.

Later that same day, a representative from Tahoe sent an email to Mr. Dimick, addressed to the Special Committee, informing the Special Committee that Tahoe would not be able to respond to the Special Committee’s request for a meaningful price increase until after the end of the Chinese New Year holiday, as it would need to conduct further financial analysis before it could do so, but that it was willing to consider improving its offer price subject to further analysis.

On February 6, 2017, representatives from O’Melveny and Skadden spoke by telephone and, during their conversation, Skadden indicated that Tahoe was willing to increase its offer price, but did not provide a revised offer price at that time. O’Melveny and Skadden discussed scheduling a teleconference between Tahoe and the Special Committee in order for further price discussions to take place.

On February 8, 2017, the Special Committee met telephonically, along with representatives from O’Melveny, RLF and Lazard, to discuss the status of discussions with Tahoe. O’Melveny updated the Special Committee regarding its February 6, 2017 discussion with Skadden and, following discussion, Lazard updated the Special Committee on the status of its financial review of the Company and discussed with the Special Committee certain assumptions and valuation methodologies of its preliminary valuation analysis. The Special Committee requested that O’Melveny contact Skadden to arrange a teleconference between Tahoe and the Special Committee to discuss the Tahoe Proposal. Later that day, representatives of O’Melveny and Skadden spoke by telephone and scheduled a teleconference between Tahoe and the Special Committee for February 10, 2017.

On February 10, 2017, the Special Committee met telephonically, along with Messrs. Tomlinson and Johns and Ms. Longmore-Grund, representatives from O’Melveny, RLF and Lazard, to discuss aspects of the Special Committee Forecasts, Lazard’s initial views regarding valuation and a negotiation strategy for the teleconference

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between the Special Committee and Tahoe scheduled for later in the day. Lazard and the Special Committee discussed that Tahoe’s price proposal of $9.60 per share was not likely within a price range which would fairly value the Company.

Later that same day, the Special Committee, with representatives from O’Melveny and RLF, held a telephonic conference with representatives from Tahoe and Skadden to discuss the Tahoe Proposal. During this conversation, Tahoe verbally indicated that it would be willing to increase its price proposal to $11.50 per share in cash which represented a premium of approximately 44.7% to the closing price per share on December 9, 2016, the last trading day prior to the public announcement of the Tahoe Proposal. The Special Committee noted that it did not believe the revised price proposal fairly valued the Company, but that it would evaluate the revised Tahoe Proposal with its independent legal and financial advisors and provide a response at a later date. No other material terms of the Tahoe Proposal were discussed.

On February 13, 2017, Mr. Dimick, following discussions with the other members of the Special Committee and on behalf of the Special Committee, and Mr. Tomlinson together spoke with a representative of Tahoe to discuss the Tahoe Proposal. During their conversation, Mr. Dimick informed Tahoe that the Special Committee was prepared to offer a non-binding counterproposal of $14.00 per share in cash for the Minority Interest. In response, the representative of Tahoe indicated that Tahoe would be providing a revised price per share offer. No other material terms of the Tahoe Proposal were discussed.

On February 16, 2017, a representative from Tahoe contacted Mr. Dimick by telephone and, during their conversation, the representative of Tahoe informed Mr. Dimick that Tahoe would be willing to increase its offer to $12.50 per share in cash for the Minority Interest, which represented a premium of approximately 57.2% to the closing price per share on December 9, 2016, the last trading day prior to the public announcement of the Tahoe Proposal. No other material terms of the Tahoe Proposal were discussed.

On February 18, 2017, the Special Committee held a telephonic meeting at which representatives from O’Melveny, RLF and Lazard were in attendance. Mr. Dimick updated the other members of the Special Committee on his recent communications with Tahoe, including with respect to Tahoe’s revised verbal proposal of $12.50 per share in cash. The Special Committee considered the merits of the revised Tahoe Proposal. The Special Committee also considered the fact that the holders of unaffiliated shares would have the chance to determine whether to accept the Tahoe Proposal given that the proposed transaction would be subject to a non-waivable condition requiring the approval by holders of a majority of the unaffiliated shares. Lazard discussed with the Special Committee its preliminary valuation analysis, including the assumptions underlying the methodologies used therein and the preliminary results of such analysis in comparison to the revised Tahoe Proposal.

On February 22, 2017, the Special Committee held a telephonic meeting at which representatives from O’Melveny, RLF and Lazard were in attendance. Lazard discussed with the Special Committee the results of its preliminary valuation analysis. The Special Committee discussed negotiation strategies for obtaining the highest possible price per share for the unaffiliated shares to encourage Tahoe to increase the price per share it was willing to offer for the unaffiliated shares in the Tahoe Proposal. The Special Committee also discussed the possibility of responding to Tahoe with another counterproposal. Following Lazard’s departure from the meeting, the Special Committee determined that Mr. Dimick should deliver a non-binding counteroffer to Tahoe at $13.80 per share in cash.

On February 26, 2017, Messrs. Dimick and Bartos held a telephonic conference with representatives from Tahoe. During their conversation, Messrs. Dimick and Bartos, on behalf of the Special Committee, informed Tahoe of the Special Committee’s counterproposal of $13.80 per share in cash. No other material terms of the Tahoe Proposal were discussed.

On March 2, 2017, Mr. Dimick received an email from a representative of Tahoe inviting Mr. Dimick, accompanied by Mr. Tomlinson, to travel to Beijing, PRC, for in-person negotiations regarding the Tahoe Proposal.

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On March 3, 2017, the Special Committee met telephonically, along with representatives from O’Melveny, RLF and Lazard, to discuss the status of the Tahoe Proposal. Mr. Dimick updated the other members of the Special Committee on the February 26, 2017 call and on the email he had received the previous day from a representative of Tahoe pursuant to which Tahoe had invited Mr. Dimick, accompanied by Mr. Tomlinson, to travel to Beijing, PRC, for in-person negotiations regarding the Tahoe Proposal. After Lazard’s departure from the meeting, the Special Committee further discussed Tahoe’s invitation to attend in-person meetings in Beijing, PRC. The Special Committee discussed whether it was appropriate to have Mr. Tomlinson accompany Mr. Dimick in light of his position as Chief Executive Officer of the Company. In consultation with O’Melveny and RLF, the Special Committee determined that it would be beneficial to have Mr. Tomlinson join Mr. Dimick on his trip to Beijing, but that Mr. Tomlinson would recuse himself from any discussions or negotiations relating to the Tahoe Proposal. In addition, the Special Committee determined that Mr. Bartos should also attend the meetings to support Mr. Dimick in the negotiations.

On March 5 and 6, 2017, Messrs. Dimick and Bartos, at the direction and on behalf of the Special Committee, met with representatives from Tahoe in Beijing to negotiate the per share price and other material terms of the Tahoe Proposal. Mr. Tomlinson accompanied Messrs. Dimick and Bartos but recused himself from the negotiations.

On March 6, 2017, the Special Committee held a telephonic meeting at which Messrs. Tomlinson and Johns, O’Melveny, RLF and Lazard were in attendance. Mr. Dimick updated the other members of the status of the Special Committee with respect to the ongoing in-person negotiations in Beijing. Mr. Dimick informed the other members of the Special Committee that, after discussion, Tahoe had offered a revised proposal of $13.20 per share in cash for the Minority Interest. After considering the offer, Messrs. Dimick and Bartos countered at $13.25 per share in cash, subject to approval by the other members of the Special Committee, which represented a premium of approximately 67% to the closing price of $7.95 per share on December 9, 2016, the last trading day prior to the public announcement of the Tahoe Proposal. Messrs. Dimick and Bartos explained that in arriving at the $13.25 per share in cash counteroffer, they had considered, among other factors, that (i) they believed a transaction at such a price represented the best alternative for the unaffiliated shares, including as compared to not engaging in a transaction and remaining a publicly traded company, (ii) the acquisition of the Minority Interest by Tahoe would be subject to a non-waivable condition requiring the approval by holders of a majority of the unaffiliated shares, (iii) the prolonged negotiations between Tahoe and the Special Committee had created uncertainty in the market and distracted management’s attention from the operation of the business, (iv) they believed that in the event the parties agreed on price, Tahoe would work with the Special Committee to complete the definitive documentation relating to the Tahoe Proposal expeditiously, (v) as a result of the prolonged negotiations, the Company was accruing considerable fees and expenses in connection with the evaluation of the Tahoe Proposal, and (vi) Tahoe had made it clear in the course of negotiations that if an agreement could be reached it expected to be able to proceed in a manner that would avoid potential regulatory delays in the PRC. Following discussion, the Special Committee discussed, with input from the representatives from Lazard, O’Melveny and RLF, Tahoe’s plans for financing the Tahoe Proposal with cash on hand if it were to move forward with the Tahoe Proposal (which cash amount would be deposited in a bank account outside of the PRC in US dollars reasonably promptly following the signing of the Merger Agreement (with the exact timing of such deposit to be mutually agreed upon at a later date)).

On March 9, 2017, the Special Committee met telephonically, along with representatives from O’Melveny, RLF and Lazard, to review the results of the in-person negotiations in Beijing between Messrs. Dimick and Bartos on behalf of the Special Committee and representatives from Tahoe. Mr. Dimick noted that, after extensive negotiations, Tahoe had verbally agreed to a revised price proposal of $13.25 per share in cash for the Minority Interest. At the in-person meetings, Mr. Dimick and Mr. Bartos had informed Tahoe that they were not authorized to agree to a price of $13.25 per share, but noted that they would discuss and evaluate the revised price proposal with the full Special Committee and promptly respond to Tahoe with the Special Committee’s decision. The Special Committee discussed, with input from representatives of Lazard, O’Melveny and RLF, Tahoe’s proposed plans for financing an acquisition of the Minority Interest and potential regulatory restrictions

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in the PRC that could impede the timely completion of a potential transaction. Lazard discussed with the Special Committee the preliminary results of its valuation analysis, which although Lazard’s valuation analysis was not yet complete, indicated that Tahoe’s revised price proposal of $13.25 per share was within a price range which would likely be fair, from a financial point of view, to the holders of Common Stock (other than excluded holders). Following this discussion, Messrs. Viviano, Samek and Bartos confirmed that they, like Mr. Dimick, were supportive of proceeding with the Tahoe Proposal at a price of $13.25 per share in cash. The Special Committee then instructed O’Melveny to commence preparing a draft of the Merger Agreement for the Tahoe Proposal. Later that day, Mr. Dimick communicated by telephone the Special Committee’s decision to proceed with further discussions regarding an acquisition of the Minority Interest by Tahoe at a price per share of $13.25 in cash to a representative of Tahoe.

On March 16, 2017, O’Melveny provided an initial draft of the Merger Agreement together with a summary of the material terms included in its initial draft of the Merger Agreement to the Special Committee for its consideration.

On March 17, 2017, the Special Committee met telephonically, along with representatives from O’Melveny and RLF, to review and discuss the initial draft of the Merger Agreement prepared by O’Melveny and RLF. O’Melveny presented the material terms of the Merger Agreement including the non-waivable condition requiring the approval by holders of a majority of the unaffiliated shares, the expense reimbursement payable by Tahoe or the Company, as applicable, if the Merger Agreement were terminated under certain circumstances, financing related provisions, the “no-shop” covenant and the requirement that Tahoe deliver to the paying agent the aggregate merger consideration as a prerequisite to the Company mailing the proxy statement in connection with the Tahoe Proposal. The draft Merger Agreement required Tahoe to represent and warrant that it had sufficient funds or other sources of immediately available funds in U.S. dollars to fund the aggregate Merger Consideration. The Special Committee asked questions of O’Melveny throughout the presentation and suggested revisions to the Merger Agreement prior to delivery of such Agreement to Tahoe.

On March 19, 2017, O’Melveny delivered by email an initial draft of the Merger Agreement to Skadden, which included the provisions and revisions based on input provided by the Special Committee.

On March 24, 2017, Skadden delivered by email a revised Merger Agreement to O’Melveny. Skadden also included in its email drafts of an Equity Commitment Letter, a Guarantee and the Rollover and Support Agreement (the “Support Agreement”), pursuant to which Tahoe would roll its Company Common Stock into a newly formed entity and agreed to vote the shares of Company Common Stock beneficially owned by THAIHOT in favor of the Tahoe Proposal, which the Special Committee had requested in order to increase certainty of closing assuming the majority-of-the-minority vote condition is satisfied.

On March 26, 2017, O’Melveny provided a summary of the material issues raised by the revised draft of the Merger Agreement circulated by Skadden on March 24, 2017, to the Special Committee for its consideration.

On March 28, 2017, the Special Committee, with representatives from O’Melveny, RLF and Lazard, met telephonically. Representatives from O’Melveny reviewed with the Special Committee the material issues in the revised draft of the Merger Agreement delivered by Skadden, including (i) the lack of a creditworthy purchaser entity being a party to the Merger Agreement, Equity Commitment Letter and Guarantee, (ii) the timing of delivery to the paying agent of the aggregate merger consideration required to consummate the Merger, (iii) modifications to the closing conditions, including the addition of a condition to Parent’s obligation to close that no more than 10% of the unaffiliated shares demanding appraisal rights, (iv) the termination and expense reimbursement provisions, including Tahoe’s reduction of the expense reimbursement that would be payable to the Company under certain circumstances from $5 million to $2.5 million, (vi) removal of the ability of the Company to effect a Change in Recommendation in the event of an Intervening Event, (vii) the removal of “anti-sandbagging” language, and (viii) modifications to, and additions of, representations and warranties of the Company.

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On April 3, 2017, at the direction of the Special Committee, O’Melveny delivered a revised draft of the Merger Agreement to Skadden that reflected input from the Special Committee that O’Melveny received during the Special Committee meeting held on March 28, 2017. Throughout the week of April 3, 2017, O’Melveny, as counsel to the Special Committee, and Skadden, as counsel to Tahoe, continued to negotiate the terms of the Merger Agreement and the Support Agreement. Included in these negotiations were negotiations regarding the terms of the “no-shop” provision, the ability of the Company to effect a Change in Recommendation in the event of an Intervening Event, the termination provisions, the amount of a potential expense reimbursement fee payable by Tahoe to the Company if the Merger Agreement were terminated in certain circumstances, the addition of Tahoe and THAIHOT as parties to the Merger Agreement (which obviated the need for the Equity Commitment Letter and Guarantee), the removal of the closing condition relating to appraisal rights and the requirement that Tahoe provide evidence reasonably satisfactory to the Special Committee that Tahoe had funds sufficient to pay the aggregate merger consideration outside of the PRC as a prerequisite to the Company mailing the proxy statement in connection with the Tahoe Proposal. Based on the negotiations, Skadden delivered a revised draft of the Merger Agreement to O’Melveny on April 7, 2017.

On April 6 and 7, 2017, the Board held a regularly scheduled meeting at its corporate offices in Newport Beach, California, which Mr. Huang, Mr. Feng and Dr. Zhang attended in person. Mr. Dimick updated the Board on behalf of the Special Committee with respect to the status of the Merger Agreement negotiations between the Special Committee and Tahoe.

Later on April 7, 2017, the Special Committee, with representatives from O’Melveny and RLF, met telephonically to discuss the remaining unresolved issues in the Merger Agreement, which were (1) the Special Committee’s requirement that Tahoe deposit funds in U.S. dollars sufficient to pay the aggregate merger consideration into a bank account outside of the PRC prior to the Company mailing the proxy statement and (2) the amount of the expense reimbursement fee to be paid by Tahoe to the Company if the Merger Agreement were terminated under certain circumstances. The Special Committee instructed O’Melveny to insist on the deposit of funds outside of the PRC prior to the mailing of the proxy statement and to counter Tahoe’s $3 million expense reimbursement fee amount at $4.5 million.

On April 9, 2017, at the Special Committee’s direction, O’Melveny delivered a revised draft of the Merger Agreement to Skadden. Throughout the remainder of that day and on April 10, 2017, O’Melveny and Skadden completed the negotiation of the terms of the Merger Agreement, including with respect to expense reimbursement payable by each party under certain circumstances and the requirement that Tahoe deposit funds sufficient to pay the aggregate merger consideration in a bank account outside of the PRC prior to the Company mailing the proxy statement relating to the Tahoe Proposal. The Special Committee and its legal advisors also completed the negotiation of the terms of the Support Agreement. On April 10, 2017, the Special Committee and the Board were provided copies of the final form of the Merger Agreement and the Support Agreement for their review. For a detailed summary of the Merger Agreement, please see “ The Merger Agreement ” on page 75 and for a detailed summary of the Support Agreement, please see “ Agreements with Purchaser Group Members Involving Common Stock ” on page 144.

On April 10, 2017, the Special Committee, along with its legal and financial advisors, met telephonically and discussed, among other things, the status of negotiations with Tahoe. Lazard, after confirming again for the Special Committee that it had no conflicts of interest with respect to its engagement, reviewed with the Special Committee its financial analysis of the Merger Consideration and delivered an oral opinion, confirmed by delivery of a written opinion dated April 10, 2017, to the Special Committee to the effect that, as of that date and based on and subject to the procedures followed, assumptions made, qualifications and limitations on the review undertaken and other matters considered by Lazard in preparing its opinion, the Merger Consideration to be received by holders of Common Stock (other than shares of Common Stock held by any stockholder who is entitled to demand and properly demands appraisal rights, shares of Common Stock held by the Company as treasury stock, or shares of Common Stock held by Purchaser Group Members (collectively, the “excluded holders”)) pursuant to the Merger Agreement was fair, from a financial point of view, to such holders. Representatives from RLF reviewed with the Special Committee their fiduciary duties in connection with the

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Tahoe Proposal. Representatives from O’Melveny reviewed the principal terms of the Merger Agreement and the Support Agreement with the Special Committee. The Special Committee and representatives from O’Melveny also discussed that the Merger Agreement included a closing condition requiring that the Merger Agreement be approved by the holders of the majority of the unaffiliated shares. Throughout that presentation, the Special Committee and representatives from O’Melveny discussed various aspects of the Tahoe Proposal and various provisions of the Merger Agreement and the Support Agreement.

Following a review of the negotiations and discussions regarding the Tahoe Proposal, the Special Committee expressed its unanimous view that the Merger Agreement and the transactions contemplated by the Merger Agreement, including the Merger, were advisable, in the best interests of and fair to the Company and the unaffiliated stockholders and thus that it would recommend approval of the Merger Agreement and the transactions contemplated by the Merger Agreement by the Company’s Board. For the basis of the Special Committee’s determination in this regard, please see “ Special Factors—Reasons for the Merger; Recommendation of the Special Committee; Recommendation of the Board; Fairness of the Merger—Special Committee ” on page 27.

Later on April 10, 2017, the Board met telephonically with Messrs. Tomlinson, Johns and Chaffee and Ms. Longmore-Grund and representatives of O’Melveny, RLF and Latham & Watkins LLP (“Latham”), outside legal counsel to the Company, to receive and discuss the Special Committee’s recommendation concerning the Tahoe Proposal. Mr. Huang, Mr. Feng and Dr. Zhang briefly attended the meeting before leaving the meeting and recusing themselves from all discussions of the Tahoe proposal to acquire the Minority Interest, the Special Committee’s recommendation and the Board’s deliberations with respect to the Merger Agreement and, as a result, none of Mr. Huang, Mr. Feng or Dr. Zhang was present for, or voted with respect to, the approval of the Merger Agreement or any related matters. At this meeting, representatives from RLF reviewed with the Board its fiduciary duties in connection with the Tahoe Proposal, and representatives from O’Melveny and Latham reviewed with the Board the terms of the definitive Merger Agreement and the Support Agreement as well as resolutions to be considered by the Board. The Special Committee recommended to the Board that it approve the Merger Agreement, the transactions contemplated by the Merger Agreement and related matters. Following the Special Committee recommendation and the Board’s own discussions and deliberations, the Board approved the Merger Agreement and determined that the Merger Agreement and the transactions contemplated by the Merger Agreement were advisable, in the best interest of and fair to the unaffiliated stockholders and resolved to recommend to the Company’s stockholders that they approve the adoption of the Merger Agreement. For the basis of the Board’s determination in this regard, please see “ Special Factors—Reasons for the Merger; Recommendation of the Special Committee; Recommendation of the Board; Fairness of the Merger —Recommendation of the Board ” beginning on page 27. Later that day, the Merger Agreement was executed by the Company, Tahoe and the Tahoe affiliates that were parties thereto, and the Support Agreement was executed by the Company, Tahoe and the Tahoe affiliates that were parties thereto.

On April 11, 2017, prior to the open of trading on the U.S. public stock markets, the Company issued a press release announcing the execution of the Merger Agreement, and filed the press release as an exhibit to its Current Report on Form 8-K.

Reasons for the Merger; Recommendation of the Special Committee; Recommendation of the Board; Fairness of the Merger

Both the Special Committee and our Board believe, based on their consideration of the factors described below, that the Merger Agreement and the transactions contemplated by it, including the merger, are substantively and procedurally fair to Alliance’s unaffiliated stockholders.

The Special Committee

The Special Committee, with the advice and assistance of its independent legal and financial advisors, evaluated the merger, the terms and conditions of the Merger Agreement and the transactions contemplated

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thereby. Over the course of approximately 7 months, the Special Committee held 25 meetings related to the merger and the other transactions contemplated thereby and led negotiations with Tahoe. At a meeting held on April 10, 2017, the Special Committee unanimously determined that the Merger Agreement and the transactions contemplated thereby, including the merger, are advisable and in the best interests of, and fair to, Alliance and the unaffiliated stockholders. The Special Committee also unanimously recommended that the Board (i) approve and declare advisable the Merger Agreement and the transactions contemplated thereby, including the merger, and (ii) recommend that the stockholders of Alliance approve the adoption of the Merger Agreement and the merger.

In evaluating the merger, the Merger Agreement and the other transactions contemplated thereby, the Special Committee consulted with the Special Committee’s independent legal and financial advisors, consulted with Alliance’s management and considered a number of factors, including, but not limited to, the following potentially positive factors (which are not intended to be exhaustive and are not listed in any relative order of importance):

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The Special Committee also considered a number of factors that are discussed below relating to the procedural safeguards that it believes were and are present to ensure the fairness of the merger and to permit the Special Committee to represent effectively the interests of the unaffiliated stockholders. These procedural safeguards, which are not intended to be exhaustive and are not listed in any relative order of importance are discussed below:

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The Special Committee also considered a variety of uncertainties, risks and potentially negative factors in its deliberations concerning the merger, including the factors discussed below, concerning the Merger Agreement and the merger (which are not intended to be exhaustive and are not listed in any relative order of importance):

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After considering the foregoing potentially negative and potentially positive factors, the Special Committee concluded that the uncertainties, risks and potentially negative factors relevant to the merger were outweighed by the potential benefits that it expected the holders of unaffiliated shares would achieve as a result of the merger.

The foregoing discussion of information and factors considered by the Special Committee is not intended to be exhaustive and may not include all of the factors considered by the Special Committee. In view of the wide variety of factors considered by the Special Committee, the Special Committee found it impracticable to quantify or otherwise assign relative weights to the foregoing factors in reaching its conclusions. In addition, individual members of the Special Committee may have given different weights to different factors and may have viewed some factors more positively or negatively than others. The Special Committee adopted Lazard’s opinion and analyses, among other factors considered, in reaching its determination as to the fairness of the transactions contemplated by the Merger Agreement, including the merger. The Special Committee recommended that the Board approve, and the Board approved, the Merger Agreement based upon the totality of the information presented to it. It should be noted that this explanation of the reasoning of the Special Committee and certain information presented in this section is forward-looking in nature and should be read in light of the factors set forth in the section entitled “ Cautionary Statement Regarding Forward-Looking Statements .”

The Special Committee did not consider the liquidation value of Alliance’s assets because the Special Committee considers Alliance to be a viable going concern business that will continue to operate regardless of whether the merger is consummated, where value is derived from cash flows generated from its continuing operations. In addition, the Special Committee believes that the value of Alliance’s assets that might be realized in a liquidation would be significantly less than its going concern value for the reasons that (i) liquidation sales generally result in proceeds substantially less than the sales of a going concern; (ii) it is impracticable to determine a liquidation value given the significant execution risk involved in any breakup of a company; (iii) an ongoing operation has the ability to continue to earn profit, while a liquidated company does not, such that the “going-concern value” will be higher than the “liquidation value” of a company because the “going concern value” includes the liquidation value of a company’s tangible assets as well as the value of its intangible assets, such as goodwill; and (iv) a liquidation process would involve additional legal fees, costs of sale and other expenses that would reduce any amounts that stockholders might receive upon liquidation. Furthermore, Alliance has no intention of liquidation and the merger will not result in the liquidation of Alliance. The Special Committee believes the analyses and additional factors it reviewed provided an indication of Alliance’s going concern value. The Special Committee also considered the historical market prices of the Common Stock. The Special Committee did not seek to determine a pre-merger going concern value for the Common Stock to determine the fairness of the Merger Consideration to Alliance’s unaffiliated stockholders. The Special Committee believes that the trading price of the Common Stock at any given time represents the best available indicator of Alliance’s going concern value at that time, so long as the trading price at that time is not impacted

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by speculation regarding the likelihood of a potential transaction. The Special Committee was not aware of any firm offer made by any unaffiliated person, other than as described in this Proxy Statement or in relation to the 2016 Transaction, during the two years prior to the date of Merger Agreement for (i) the merger or consolidation of the Company with another company, or vice versa, (ii) the sale or transfer of all or any substantial part of the Company’s assets, or (iii) a purchase of the Company’s securities that would enable such person to exercise control of the Company. Further, the Special Committee did not consider net book value, which is an accounting concept, as a factor because it believed that net book value is not a material indicator of the value of Alliance as a going concern but rather is indicative of historical costs and because net book value does not take into account the prospects of Alliance, market conditions, trends in the industry in which Alliance operates or the business risks inherent in that industry.

Recommendation of the Board

The Board consists of nine directors. On April 10, 2017, based in part on the unanimous recommendation of the Special Committee, as well as on the basis of the other factors described above, the Board unanimously (with Messrs. Qisen Huang, Heping Feng and Tao Zhang recusing themselves) on behalf of Alliance:

The Board (with Messrs. Qisen Huang, Heping Feng and Tao Zhang recusing themselves) unanimously recommends that you vote “FOR” the adoption of the Merger Agreement.

Our Board believes, based on their considerations of the factors described above, that the Merger Agreement and the transactions contemplated by it, including the merger, are substantively and procedurally fair, to the Company’s unaffiliated stockholders. In adopting the Special Committee’s recommendations and concluding that the Merger Agreement and the transactions contemplated by it, including the merger, are in the best interests of the Company and the unaffiliated stockholders, our Board consulted with outside legal advisors, considered and relied upon the same factors and considerations that the Special Committee relied upon, as described above, and adopted as its own analysis the Special Committee’s analyses and conclusions in their entirety. The Board is not aware of any firm offer made by any unaffiliated person, other than as described in this Proxy Statement or in relation to the 2016 Transaction, during the two years prior to the date of Merger Agreement for (i) the merger or consolidation of the Company with another company, or vice versa, (ii) the sale or transfer of all or any substantial part of the Company’s assets, or (iii) a purchase of the Company’s securities that would enable such person to exercise control of the Company.

Opinion of Financial Advisor to the Special Committee

The Special Committee retained Lazard to act as financial advisor in connection with the merger. As part of that engagement, the Special Committee requested that Lazard evaluate the fairness, from a financial point of view, to the holders of Common Stock (other than excluded holders) of the consideration to be paid to such holders in the merger. On April 10, 2017, Lazard rendered its oral opinion to the Special Committee, subsequently confirmed in writing, that, as of that date and based upon and subject to the assumptions, procedures, factors, qualifications and limitations set forth therein, the per share Merger Consideration to be paid to holders of Common Stock (other than Excluded Holders) in the merger was fair, from a financial point of view, to such holders.

The full text of Lazard’s written opinion, dated April 10, 2017, which sets forth the assumptions made, procedures followed, factors considered, and qualifications and limitations on the review undertaken by Lazard in connection with its opinion is attached to this proxy statement as Annex B and is

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incorporated into this proxy statement by reference. The description of Lazard’s opinion set forth in this proxy statement is qualified in its entirety by reference to the full text of Lazard’s written opinion attached as Annex B. We encourage you to read Lazard’s opinion and this section carefully and in their entirety.

Lazard’s opinion was directed to the Special Committee for the information and assistance of the Special Committee in connection with its evaluation of the merger and only addressed the fairness, from a financial point of view, to holders of Common Stock (other than excluded holders) of the per share Merger Consideration to be paid to such holders in the merger as of the date of Lazard’s opinion. The Special Committee did not request Lazard to consider, and Lazard’s opinion did not address, the relative merits of the merger as compared to any other transaction or business strategy in which Alliance might engage or the merits of the underlying decision by Alliance to engage in the merger. Lazard’s opinion was not intended to and does not constitute a recommendation to any holder of Common Stock as to how such holder should vote or act with respect to the merger or any matter relating thereto. Lazard’s opinion was necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to Lazard as of, the date of Lazard’s opinion. Lazard assumed no responsibility for updating or revising its opinion based on circumstances or events occurring after the date of Lazard’s opinion. Lazard’s opinion did not express any opinion as to the prices at which shares of Common Stock may trade at any time subsequent to the announcement of the merger.

The following is a summary of Lazard’s opinion. We encourage you to read Lazard’s written opinion carefully in its entirety.

In connection with its opinion, Lazard:

Lazard assumed and relied upon the accuracy and completeness of the foregoing information, without independent verification of such information. Lazard did not conduct any independent valuation or appraisal of any of the assets or liabilities (contingent or otherwise) of Alliance or any other party to the merger or concerning the solvency or fair value of Alliance or any other party to the merger, and Lazard was not furnished with any such valuation or appraisal. With respect to the financial forecasts utilized in Lazard’s analyses, Lazard assumed, with the consent of the Special Committee, that they were reasonably prepared on bases reflecting the best currently available estimates and judgments as to the future financial performance of Alliance, including the estimated timing and financial impact of Alliance’s anticipated refinancing of its debt facilities in 2017. Lazard assumed no responsibility for and expressed no view as to any such forecasts or the assumptions on which they are based. Lazard noted that given the limited equity research coverage of the Alliance peer set, lack of equity research coverage for Alliance, and significant historical trading discount of Alliance as compared to selected peers, and the limited number of comparable transactions within a relevant timeframe, Lazard concluded that both comparable companies and precedent transactions analyses were not useful methodologies for purposes of analyzing the valuation of Alliance, and therefore relied upon a discounted cash flow analysis in reaching its opinion.

In rendering its opinion, Lazard assumed, with the consent of the Special Committee, that the merger would be consummated on the terms described in the draft dated April 10, 2017, of the Merger Agreement, without any

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waiver or modification of any material terms or conditions. Representatives of the Special Committee advised Lazard, and Lazard assumed, that the Merger Agreement, when executed, would conform to the draft reviewed by Lazard in all material respects. Lazard also assumed, with the consent of the Special Committee, that obtaining the necessary governmental, regulatory or third party approvals and consents for the merger would not have an adverse effect on Alliance or the merger. Lazard did not express any opinion as to any tax or other consequences that might result from the merger, nor does Lazard’s opinion address any legal, tax, regulatory or accounting matters, as to which Lazard understood that Alliance obtained such advice as it deemed necessary from qualified professionals. Lazard expressed no view or opinion as to any terms or other aspects (other than the per share Merger Consideration to the extent expressly specified in Lazard’s opinion) of the merger, including, without limitation, the form or structure of the merger or any agreements or arrangements entered into in connection with, or contemplated by, the merger. In addition, Lazard expressed no view or opinion as to the fairness of the amount or nature of, or any other aspects relating to, the compensation to any officers, directors or employees of any parties to the merger, or class of such persons, relative to the per share Merger Consideration or otherwise.

Summary of Lazard’s Financial Analyses

The following is a summary of the material financial analyses reviewed with the Special Committee in connection with Lazard’s opinion, dated April 10, 2017. The summary of Lazard’s analyses and reviews provided below is not a complete description of the analyses and reviews underlying Lazard’s opinion. The preparation of a fairness opinion is a complex process involving various determinations as to the most appropriate and relevant methods of analysis and review and the application of those methods to particular circumstances, and, therefore, is not readily susceptible to summary description. Considering selected portions of the analyses and reviews or the summary set forth below, without considering the analyses and reviews as a whole, could create an incomplete or misleading view of the analyses and reviews underlying Lazard’s opinion.

For purposes of its analyses and reviews, Lazard considered industry performance, general business, economic, market and financial conditions and other matters, many of which are beyond the control of Alliance. No company, business or transaction used in Lazard’s analyses and reviews as a comparison is identical to Alliance or the merger, and an evaluation of the results of those analyses and reviews is not entirely mathematical. Rather, the analyses and reviews involve complex considerations and judgments concerning financial and operating characteristics and other factors that could affect the acquisition, public trading or other values of the companies, businesses or transactions used in Lazard’s analyses and reviews. The estimates contained in Lazard’s analyses and reviews and the ranges of valuations resulting from any particular analysis or review are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than those suggested by Lazard’s analyses and reviews. In addition, analyses and reviews relating to the value of companies, businesses or securities do not purport to be appraisals or to reflect the prices at which companies, businesses or securities actually may be sold. Accordingly, the estimates used in, and the results derived from, Lazard’s analyses and reviews are inherently subject to substantial uncertainty.

Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before April 10, 2017, and is not necessarily indicative of current market conditions.

Discounted Cash Flow Analysis

Using the projections provided by Alliance and described in more detail under “ Special Factors—Projected Financial Information ”, Lazard performed a discounted cash flow analysis of Alliance to calculate the estimated net present value of Alliance, as of December 31, 2016, based on the sum of (1) the unlevered free cash flows that Alliance was forecasted to generate during the fiscal years 2017 through 2021, (2) the terminal value of Alliance and (3) the estimated amounts of utilized net operating loss carry-forwards of Alliance for each of years 2017 through 2023. The terminal value for Alliance was calculated by applying perpetuity growth rates ranging from 0.75% to 1.25% to Alliance’s terminal year unlevered free cash flow, as set forth in “ Special Factors—

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Projected Financial Information ”. The perpetuity growth rates were derived based on Lazard’s professional judgment and taking into account, among other factors, projections provided by Alliance and described in more detail under “ Special Factors—Projected Financial Information ”, Alliance’s historical financial performance and trends in the industry and the general economy. The estimated amounts of net operating loss carry-forwards (“NOLs”) utilized by Alliance were calculated based on the projections provided by Alliance and described in more detail under “ Special Factors—Projected Financial Information ”. The estimated present value of the NOLs and prepaid taxes were calculated based on the sum of the anticipated tax shield over the period of their projected usage (from 2017 to 2023) for U.S. federal, state and prepaid taxes using a weighted average applicable U.S. federal income tax rate of 35.0% and state income tax rate of 7.53%, each as estimated by Alliance management and discounted using a discount range of 9.0% to 10.0%. The unlevered free cash flows, terminal values and amount of the net operating loss carry-forwards utilized by Alliance were discounted to present value using discount rates ranging from 9.0% to 10.0%. The discount rates applicable to Alliance were based on Lazard’s judgment of an estimated range of weighted average cost of capital for Alliance. Lazard then calculated an implied per share equity value as total enterprise value (based on the sum of the present value of the free cash flows to Alliance during the forecast period plus the present value of the terminal value, each discounted by the weighted average cost of capital range of 9.0% to 10.0%) less pro forma debt attributable to Alliance (calculated as the sum of debt and cash held outside joint ventures and Alliance’s share of debt and cash held within joint ventures as of December 31, 2016, plus $9.7 million of after-tax cost of fees and expenses anticipated to be paid in connection with Alliance’s anticipated refinancing), plus the estimated present value of NOLs and pre-paid taxes, divided by the amount of fully diluted Common Stock outstanding as of March 31, 2017, as provided by Alliance. This analysis resulted in an implied per share equity reference range for Alliance of $8.39 to $17.44 as compared to the per share Merger Consideration of $13.25.

Other Analyses and Reviews

The analyses and data described below were presented to the Special Committee for informational purposes only and did not provide the basis for, and were not material to, the rendering of Lazard’s opinion.

Selected Companies Analysis

Lazard reviewed and analyzed certain financial information, valuation multiples and market trading data related to selected publicly-traded outsourced radiology providers (RadNet, Inc. and Digirad Corporation). Lazard determined, however, that, given the limited equity research coverage of the Alliance peer set, lack of equity research coverage for Alliance and significant historical trading discount of Alliance as compared to selected peers, a comparable companies analysis was not a useful methodology for purposes of analyzing the valuation of Alliance, and therefore relied upon a discounted cash flow analysis in reaching its opinion.

For informational purposes, Lazard calculated and compared the ratio of each of RadNet Inc.’s and Digirad Corporation’s enterprise value, calculated as the market capitalization of each company (based on its closing share price as of April 7, 2017 and most recently publicly reported fully-diluted share count), plus debt, less cash, cash equivalents and marketable securities (based on the most recent publicly available data) to its calendar year 2017 estimated earnings before interest, taxes, depreciation and amortization, excluding the minority interest and deducting stock-based compensation, referred to in this subsection as “Adjusted EBITDA”. The Adjusted EBITDA estimates for each of the companies used by Lazard in its analysis were based on FactSet consensus estimates and Wall Street research. This resulted in an enterprise value to 2017E Adjusted EBITDA multiple range of 6.9x—7.3x for the comparable companies. Lazard applied such range of enterprise values to Adjusted EBITDA multiples for the comparable companies to the estimated Adjusted EBITDA of Alliance for 2017, to arrive at implied equity values for Common Stock of $21.49 and $25.37.

2016 Transaction Analysis

Lazard reviewed certain publicly available information and information provided by Alliance management with respect to the 2016 Transaction. Lazard applied the Implied EBITDA multiple (determined to be a range

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between 5.2x and 6.0x) from the 2016 Transaction to Alliance’s 2017E Adjusted EBITDA (not reduced by minority interest and before deduction for stock-based compensation) of $142.6 million to arrive at a range of implied equity values for Common Stock of $4.62 to $14.79.

Selected Squeeze-Out Transactions Analysis

Lazard reviewed and analyzed certain publicly available financial information for 15 selected precedent squeeze-out transactions from January 1, 2012 to April 7, 2017 with a transaction value greater than $50 million involving U.S.-listed target and majority stakeholders buying out remaining stakeholders.

Lazard applied a 30.6% and 54.9% premium, based on the median and mean premiums in the selected squeeze-out transactions, to Alliance’s unaffected share price of $7.95 to arrive at a range of implied equity values for Common Stock of $10.38 to $12.32. Lazard observed a maximum premium of 284.6% and a minimum premium of 6.5%, and observed that the 25 ^th percentile premium was 23.6% and the 75 ^th percentile premium was 60.6%.

52-Week High/Low Trading Prices:

Lazard reviewed the range of trading prices for Common Stock for the 52 weeks ended December 9, 2016. Lazard observed that, during this period, the daily closing prices of Common Stock ranged from $5.77 to $9.30 per share on August 2, 2016 and December 18, 2015, respectively.

Miscellaneous

In connection with Lazard’s services as the Special Committee’s financial advisor, Alliance has agreed to pay Lazard an aggregate fee for such services of a total of $2.8 million, portions of which became payable upon Lazard’s engagement and during the course of its engagement, $1.4 million of which was payable upon the rendering of its opinion (less previously received payments) and $1.4 million of which is contingent upon the closing of the merger. In addition, Alliance may pay Lazard a discretionary fee in an amount to be determined by the Special Committee in its sole discretion, upon the closing of the merger. Alliance also agreed to reimburse Lazard for certain expenses incurred in connection with Lazard’s engagement and to indemnify Lazard and certain related persons under certain circumstances against certain liabilities that may arise from or relate to Lazard’s engagement. Other than its engagement as financial advisor to the Special Committee in connection with the merger, no material relationships existed in the past two years between Lazard’s financial advisory business and either Alliance or Tahoe, including any material relationship pursuant to which any compensation was received.

Lazard, as part of its investment banking business, is continually engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, negotiated underwritings, secondary distributions of listed and unlisted securities, private placements, leveraged buyouts and valuations for other purposes. In the ordinary course, Lazard and its affiliates and employees may trade securities of Alliance and certain of its affiliates for their own accounts and for the accounts of their customers, may at any time hold a long or short position in such securities, and may also trade and hold securities on behalf of Alliance and the Purchaser Group Members. The issuance of Lazard’s opinion was approved by the opinion committee of Lazard.

Lazard is an internationally recognized investment banking firm providing a full range of financial advisory and other services. After considering Lazard’s knowledge and expertise in mergers and acquisitions transactions, experience advising special committees in going private transactions and experience in cross-border transactions with PRC based entities and after Lazard’s confirmation that there were no conflicts of interest present that would affect Lazard’s ability to effectively provide advice to the Special Committee, the Special Committee determined to engage Lazard as its independent financial advisor and executed an engagement letter with Lazard on the same day.

Lazard did not recommend any specific consideration to the Special Committee or that any given consideration constituted the only appropriate consideration for the merger. Lazard’s opinion and analyses were

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only one of many factors taken into consideration by the Special Committee in its evaluation of the merger. Consequently, the analyses described above should not be viewed as determinative of the views of the Special Committee or Alliance’s management with respect to the consideration provided for in the merger or as to whether the Special Committee would have been willing to determine that a different consideration was fair.

Purchaser Group Members’ Purposes and Reasons for the Merger

Under the SEC rules governing “going private” transactions, each Purchaser Group Member is deemed to be engaged in a “going private” transaction and, therefore, is required to express his, her or its reasons for the merger to the unaffiliated stockholders, as defined in Rule 13e-3 of the Exchange Act. Each Purchaser Group Member is making the statements included in this section solely for the purpose of complying with the requirements of Rule 13e-3 and related rules under the Exchange Act.

For each Purchaser Group Member, the primary purpose of the merger is to acquire, through Parent, all shares of Common Stock not owned by them to benefit from any future earnings and growth of the Company after the merger of Sub with and into the Company, making the Company privately held and wholly-owned by Parent. The Purchaser Group believes that structuring the transaction in such manner is preferable to other transaction structures because (i) it will enable Parent to directly acquire all of the outstanding shares of the Company at the same time, (ii) it will allow the Company to cease to be a publicly registered and reporting company, (iii) it represents an opportunity for the Company’s stockholders other than the Purchaser Group to immediately realize the value of their investment in the Company and (iv) it also allows THAIHOT, as the controlling stockholder of the Company, to maintain all of its investment in the Company through its indirect ownership in Parent.

The Purchaser Group also believes that it is in the best interests of the Company to operate as a privately-held entity. As a privately-held entity, the Company will have greater operational flexibility to pursue alternatives that it would not have as a public company, and management will be able to concentrate on long-term growth, reducing the focus on the quarter-to-quarter performance often emphasized by the public equity market’s valuation of Company Stock. Each Purchaser Group Member also believes that the merger will provide the Company with flexibility to pursue transactions with a risk profile that may be unacceptable to many public stockholders, and that these transactions can be more effectively executed as a private company.

In addition, as a privately-held entity, the Company will be relieved of many of the other expenses, burdens and constraints imposed on companies that are subject to the public reporting requirements under the federal securities laws of the United States, including the Exchange Act and Sarbanes-Oxley Act of 2002. The need for the management of the Company to be responsive to the unaffiliated stockholders’ concerns and to engage in an on-going dialogue with the unaffiliated stockholders can at times distract the management’s time and attention from the effective operation and improvement of the business.

The Purchaser Group also considered a variety of potentially negative factors to it concerning the Merger Agreement and the merger, which are listed below, although not listed in any relative order of importance:

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Position of the Purchaser Group as to Fairness of the Merger

Under SEC rules governing going private transactions, each of the Purchaser Group Member is required to express his, her or its belief as to the fairness of the merger to the unaffiliated stockholders . Each of the Purchaser Group Members is making the statements included in this section solely for the purpose of complying with the requirements of Rule 13e-3 and related rules under the Exchange Act.

The Purchaser Group has interests in the merger that are different from those of the other stockholders of the Company by virtue of its continuing interests in the surviving corporation after the completion of the merger. The Purchaser Group attempted to negotiate with the Special Committee the terms of a transaction that would be most favorable to the Purchaser Group, and not necessarily to the Company’s unaffiliated stockholders, and, accordingly, did not negotiate the Merger Agreement with a goal of obtaining terms that were fair to such unaffiliated stockholders. The Special Committee consists of four directors of the Company who are not affiliated with the Purchaser Group Members, are not employees of the Company or any of its affiliates and have no financial interest in the merger different from, or in addition to the interests of the Company’s unaffiliated stockholders other than their interests described under “ Special Factors — Interests of Alliance’s Directors and Executive Officers in the Merger ” beginning on page 54. Accordingly, the Purchaser Group believes that the members of the Special Committee are independent and disinterested directors of the Company.

The Purchaser Group did not participate in the deliberations of the Special Committee regarding, or receive any advice from the Special Committee’s independent legal or financial advisors as to, the substantive or procedural fairness of the merger to the Company’s unaffiliated stockholders. The Purchaser Group has not performed, or engaged a financial advisor to perform, any valuation or other analysis for the purposes of assessing the fairness of the merger to the Company’s unaffiliated stockholders. No financial advisor provided the Purchaser Group with any analysis, opinion or appraisal with respect to the fairness of the Merger Consideration to the unaffiliated stockholders.

Based on its knowledge and analysis of available information regarding the Company, as well as the factors considered by, and the analyses and resulting conclusions of, the Special Committee and the Board discussed under “ Special Factors—Reasons for the Merger; Recommendation of the Special Committee; Recommendation of the Board; Fairness of the Merger ” beginning on page 27, each Purchaser Group Member believes that the merger is substantively and procedurally fair to the unaffiliated stockholders based on its consideration of the following factors, which are not listed in any relative order of importance:

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The Purchaser Group did not consider the Company’s net book value, which is defined as total assets minus total liabilities, as a factor. The Purchaser Group believes that net book value, which is an accounting concept based on historical costs, is not a material indicator of the value of the Company as a going concern because it does not take into account the future prospects of the Company, market conditions, trends in the industry in which the Company conducts its business or the business risks inherent in competing with other companies in the same industry.

In its consideration of the fairness of the merger, the Purchaser Group did not consider the Company’s liquidation value to be a relevant valuation method because it considers the Company to be a viable, going concern business where value is derived from cash flows generated from its continuing operations and because the Company will continue to operate its business following the merger.

The Purchaser Group did not seek to establish a pre-merger going concern value for the Common Stock to determine the fairness of the Merger Consideration to the unaffiliated stockholders. Each of the Purchaser Group Members believes that the trading price of the Common Stock at any given time represents the best available indicator of Alliance’s going concern value at the time, so long as the trading price of that time is not impacted by speculation regarding the likelihood of a potential transaction. To the extent the pre-merger going concern value was reflected in the pre-announcement price of the Common Stock, the Merger Consideration represented a premium to the going concern value of the Company.

The Purchaser Group considered the previous transaction in the Company’s shares by members of the Purchaser Group in the 2016 Acquisition, where the Purchaser Group acquired an aggregate of 5,537,945 shares of Common Stock representing approximately 51.5% of the then outstanding shares of the Company at a price of $18.50 per share. The Purchaser Group believes that the premiums to market value described above reflect a more appropriate comparison of the value to be paid to unaffiliated stockholders than the 2016 Acquisition, in which the Purchaser Group acquired control of the Company in a single transaction at a price with a premium (including control premium) of 12.7% over Alliance’s closing trading price of $16.41 per share on September 15, 2015, the last trading day prior to the press release announcing the signing of the 2016 Acquisition.

Each of the Purchaser Group Members is not aware of, and thus did not consider in its fairness determination, any offers or proposals made by any unaffiliated third parties with respect to (a) a merger or

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consolidation of the Company with or into another company, (b) a sale of all or a substantial part of the Company’s assets or (c) the purchase of the Company voting securities that would enable the holder to exercise control over the Company.

The Purchaser Group did not perform or receive any independent reports, opinions or appraisals from any third party related to the merger, and thus did not consider any such reports, opinions or appraisals in determining the substantive and procedural fairness of the merger to the unaffiliated stockholders .

The foregoing is a summary of the information and factors considered and given weight by each of the Purchaser Group Members in connection with its evaluation of the substantive and procedural fairness of the merger to the unaffiliated stockholders, which is not intended to be exhaustive, but includes all material factors considered by the Purchaser Group. The Purchaser Group did not find it practicable to assign, and did not assign, relative weights to the individual factors considered in reaching their conclusion as to the substantive and procedural fairness of the merger to the unaffiliated stockholders. Rather, its fairness determination was made after consideration of all of the foregoing factors as a whole.

Each of the Purchaser Group Members believes these factors provide a reasonable basis for its belief that the merger is substantively and procedurally fair to the unaffiliated stockholders. This belief should not, however, be construed as a recommendation to any stockholder of the Company to vote in favor of the proposal to adopt the Merger Agreement. None of the Purchaser Group Members makes any recommendation as to how stockholders of the Company should vote their shares of Common Stock on the proposal to adopt the Merger Agreement.

Plans for Alliance After the Merger

It is expected that Alliance’s operations will be conducted after the merger substantially as they currently are being conducted, except that it will cease to be a publicly traded company and will instead be a wholly owned subsidiary of Parent. Following the completion of the merger, the Company will no longer be subject to the Exchange Act and NASDAQ compliance and reporting requirements and the related direct and indirect costs and expenses, and may experience positive effects on profitability as a result of the elimination of such costs and expenses.

The directors of Sub will be the directors of Alliance immediately following the merger. The Purchaser Group Members intend that, upon consummation of the merger, the officers of Alliance will remain in their positions.

The Purchaser Group Members have advised Alliance that they do not have any current intentions, plans or proposals to cause Alliance to engage in any of the following:

Nevertheless, following consummation of the merger, the surviving corporation’s management and board of directors may initiate a review of Alliance and its assets, corporate and capital structure, capitalization, operations, business, properties and personnel to determine what changes, if any, would be desirable following the merger to enhance the business and operations of Alliance and may cause Alliance to engage in the types of transactions set forth above if the management or the board of directors decides that such transactions are in the best interest of Alliance upon such review. The Purchaser Group Members expressly reserve the right to make any changes to Alliance’s operations after consummation of the merger that they deem appropriate in light of such evaluation and review or in light of future developments.

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Certain Effects of the Merger

If the Merger Agreement is adopted by the requisite stockholder approval and the other conditions to the closing of the merger are either satisfied or waived, Sub will be merged with and into Alliance, the separate corporate existence of Sub will cease and Alliance will continue its corporate existence under Delaware law as the surviving corporation in the merger, with all of its rights, privileges, immunities, powers and franchises continuing unaffected by the merger.

Upon consummation of the merger, each share of Common Stock issued and outstanding immediately prior to the effective time of the merger (other than shares beneficially owned by Purchaser Group Members, shares owned by Alliance or dissenting shares) will immediately be converted into the right to receive the Merger Consideration, without interest and less applicable withholding taxes.

Following the merger, the entire equity in the surviving corporation will ultimately be owned by the Purchaser Group Members. If the merger is completed, the Purchaser Group Members will be the sole beneficiaries of Alliance’s future earnings and growth, if any, and will be entitled to vote on corporate matters affecting Alliance following the merger. Similarly, the Purchaser Group Members will also bear the risks of ongoing operations, including the risks of any decrease in Alliance’s value after the merger.

If the merger is completed, Alliance’s unaffiliated stockholders will have no interest in Alliance’s net book value or net earnings. Based on the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, the table below sets forth the direct and indirect interests in Alliance’s net book value and net earnings of the Purchaser Group Members as of and for the year ended December 31, 2016, and what those interests would have been had the merger been completed as of that date.

A primary benefit of the merger to Alliance’s stockholders (other than Purchaser Group Members) will be the right of such stockholders to receive the Merger Consideration as described above, representing a premium of approximately 67% over the trading price of $7.95 per share of our Common Stock on December 9, 2016, the last trading day prior to the date Tahoe’s initial proposal was publicly disclosed, and a premium of 38% over the $9.60 purchase price per share initially offered by Tahoe. Additionally, such stockholders will avoid the risk of any possible decrease in Alliance’s future earnings, growth or value.

The primary detriments of the merger to such stockholders include the lack of interest of such stockholders in Alliance’s potential future earnings, growth or value. Additionally, the receipt of cash in exchange for shares of Common Stock pursuant to the merger will generally be a taxable sale transaction for U.S. federal income tax purposes to our stockholders who surrender shares of the Common Stock in the merger, as described further under the section entitled “ Special Factors—Material U.S. Federal Income Tax Consequences of the Merger ”.

In connection with the merger, the Purchaser Group Members will receive benefits and be subject to obligations that are different from, or in addition to, the benefits received by Alliance’s stockholders generally. The primary benefits of the merger to the Purchaser Group Members, based on their ownership of all the equity interests in Parent, include their indirect interest in Alliance’s potential future earnings and growth which, if they successfully execute their business strategies, could be substantial. Additionally, following the merger, Alliance will be a private company, and as such will be relieved of the burdens imposed on companies with publicly

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traded equity, including the requirements and restrictions on trading that Alliance’s directors, officers and beneficial owners of more than 10% of the outstanding shares of Common Stock face as a result of the provisions of Section 16 of the Exchange Act. Additionally, following the merger, Messrs. Qisen Huang and Yong Ge will be directors of the surviving corporation.

The primary detriments of the merger to the Purchaser Group Members include the fact that all of the risk of any possible decrease in Alliance’s earnings, growth or value following the merger will be borne by Parent. Additionally, the investment by the Purchaser Group Members in Parent and Alliance will not be liquid, with no public trading market for such securities.

In connection with the merger, certain members of Alliance’s management will receive benefits and be subject to obligations that may be different from, or in addition to, the benefits and obligations of Alliance’s stockholders generally, as described in more detail under “ Special Factors—Interests of Alliance’s Directors and Executive Officers in the Merger ” beginning on page 54. Those incremental benefits are expected to include, among others, certain executive officers continuing as executive officers of the surviving corporation.

The shares of Common Stock are currently registered under the Exchange Act and are quoted on NASDAQ under the symbol “AIQ.” As a result of the merger, Alliance will be a privately held corporation and there will be no public market for its shares. After the merger, the shares of Common Stock will cease to be listed on NASDAQ and price quotations with respect to sales of shares of Common Stock in the public market will no longer be available. In addition, registration of the Common Stock under the Exchange Act will be terminated.

At the effective time of the merger, the certificate of incorporation and bylaws of Alliance will be amended and restated to read as set forth in Exhibits A and B, respectively, to the Merger Agreement, and, as so amended and restated, will be the certificate of incorporation and by-laws of Alliance following the merger until thereafter amended in accordance with their respective terms and the DGCL.