S T R I C T L Y P R I V A T E A N D C O N F I D E N T I A L Professional Services Proposal for Mr Hassan Awdi Project “Rodipet Reciclare” 17 March 2007

S T R I C T L Y P R I V A T E A N D C O N F I D E N T I A L

Professional Services

Proposal for

Mr Hassan Awdi

Project “Rodipet Reciclare”17 March 2007

Osprey Partners

39 Mendeleev Street

Bucharest, Romania

T. (40) 21 314 5030 F. (40) 21 314 5070

[email protected]

www.osprey-partners.com

www.imap.com

http://www.osprey-partners.com/

http://www.imap.com/

INTRODUCING IMAP

(The World’s Largest M&A Advisory Organization)

3© IMAP. Proprietary and Confidential

IMAP is the world’s largest M&A organization

IMAP is the largest organization of independent M&A advisory firms in the world. It includes 58 firms located in 33 different countries

Founded in 1972, it is also the world’s longest established M&A advisory organization, aiming to unite the “best in local market” M&A practices in the world’s different geographies

IMAP focuses exclusively in M&A advisory work, particularly sell side mandates, international search assignments, targeted buy mandates, fairness opinions and valuations

IMAP typically advises on transactions in the €10-50 million range

In 2006, the largest transaction size completed by IMAP is €1.350 million and the smallest is €5 million

IMAP works for private family owned companies, large domestic companies, multinational companies, private equity firms and institutional investors

IMAP completed 220 separate transactions in its last financial year 2005. The majority of its transactions were cross-border

Worldwide M&A Rankings 2005 by Number of Deals

Worldwide Announced THOMSON FINANCIAL

Undisclosed and Values Up to US$50 MMBased on Number of Transactions1/1/2006 - 12/31/2006

No.Rank Financial Advisor Deals

1 KMPG Corporate Finance 3712 PriceWaterhouseCoopers 2483 Deloitte & Touch 1914 Ernst & Young 1835 IMAP 1636 Rothschild 1607 JPMorganChase 1147 M&A International 1149 UBS 110

10 Global M&A 10911 Mitsubishi UFJ 10812 Nomura 10413 Citigroup 10114 Grant Thornton 10015 Goldman Sachs 9916 Daiwa Securities SMBC 9717 Mizuho 9618 Credit Suisse 8819 Lazard 8220 Houilhan Lokey Howard & Zukin 8021 Morgan Stanley 7822 Jefferies & Co. 7623 Merrill Lynch 7424 Deutsche Bank 6525 ABN AMRO 62

Worldwide Announced THOMSON FINANCIAL

Undisclosed and Values Up to US$50 MMBased on Value1/1/2006 - 12/31/2006

ValueRank Financial Advisor US$MM

1 KMPG Corporate Finance 1,777.02 PriceWaterhouseCoopers 1,406.93 Nomura 1,297.84 Rothschild 1,136.25 Deloitte & Touch 1,129.66 Ernst & Young 1,013.27 Daiwa Securities SMBC 1,005.98 JPMorganChase 956.99 Houilhan Lokey Howard & Zukin 847.2

10 UBS 821.511 Somerley 777.212 Mitsubishi UFJ 728.413 IMAP 682.114 Nikko Cordial Securities 670.414 Jefferies & Co. 670.416 M&A International 649.917 Commerce International 649.318 Grant Thornton 622.519 Global M&A 618.220 Citigroup 561.921 Mizuho 551.222 Goldman Sachs 520.923 Anglo Chinese Corp Finance 505.324 Lazard 494.525 Macquarie 493.4

The Leading M&A Networks by Number of Firms

Introducing IMAP


IMAP operates an integrated “one firm” philosophy. We apply best practice methodologies and quality standards rigorously across our 58 member firms

IMAP is organised both geographically and by industry specialisation. This allows IMAP to harness its global execution capability in a wide variety of industry sectors to meet each client’s specific needs

IMAP will present the client a “tailor made team” headed by a single Client Global Coordinator. The Client Global Coordinator will normally be located in the client’s local market.

The Client Global Coordinator will have a detailed understanding of transaction issues in the local market place and will be the primary provider of advice to the client as the transaction process evolves

The full IMAP transaction team operating in tandem with the Client Global Coordinator will provide industry insights from industry specialists throughout the world as well as access to buyers or sellers in the target industry

IMAP’s Global Coverage

How IMAP Works for You

IMAP brings together local expertise and global presence

The following countries are represented in IMAP’s Global network:

Argentina Australia Australia/AsiaAustria Belgium BrasilBulgaria Canada CroaciaChec Republic Denmark FinlandFrance Germany GreeceHong Kong Hungary IcelandIreland Israel ItalyJapan Mexico HollandNorway Poland PortugalRumania Russia SerbiaSlovaquia Turkey SwedenSwitzerland UK USAVenezuela


The Faces of IMAP Europe

Austria Belgium Bulgaria Croatia Czech Czech Denmark Finland

France Germany Germany Hungary Italy Netherlands Norway Poland

Romania Serbia Slovakia Spain Sweden Switzerland Turkey United Kingdom

Business Planning, Raising Finance for “Rodipet Reciclare”


Business Planning and Raising Finance for a Start Up (1)

Our Approach

We will cover all the steps necessary, in a systematic way, working with you (the “promoter”) and your project manager

to make sure that your “great idea” becomes a financiable project. We believe that EU finance from the new Post

Accession funds will be important sources of finance and we are working already with a consultant specialising in this

area. We are sure that recycling will qualify for EU funds and this idea could enhance the value of Rodipet. We also

believe that Rodipet can leverage off its strong national coverage and form a collection network, and other rival

organisations cannot match this collection power.

Step 1 A Professional Business Plan and a Financial Model: You need a compelling investment case for investors

even if they are EU funds. This story is going to increase the value of your share in the project, but it is the capital

injected or the “gas in the tank” from an investor that will make the growth happen. Investors need this story to be

written in an explicit way, most often in a “Business Plan”, with the financial forecasting assumptions linked to marketing

and economic data. The forecasts need to be linked directly to the assumptions and the entire set of assumptions all

together, must be a unified business strategy covering finance, operations and marketing.

We guide you through this process and act as a “sounding board” on business ideas and the assumptions, to help

make sure the strategy is as solid as it can be. We translate that strategy and the assumptions supporting it, into

figures, in the Financial Model.

Note: For most Private Equity Groups (PEGs) a strong Business Plan with a model is sufficient. However a larger

private placement or a “club investment” might require an Offering Memorandum. The EU require a Business Plan and

their own unique application forms (per line of finance) completed.



Step 2 Diagnosing the Financing Requirement of the Project

We forecast the revenues and the costs of the project/company using a “bottom up” approach. The model is created in

modular form and all assumptions are explicit. The owner may change the assumptions to create different scenarios.

We forecast investment flows, operating flows and all costs as well as revenues. The resulting “hole” in the direct cash

flow is the “financing requirement”.

We simulate different capital structures (equity injection only, new debt only, EU financing and combinations). We can

run different capital structure scenarios through it together and you can see the impact on indicators like profit, debt to

equity ratio and most importantly, the value of the shares of the company and your ownership %. We value your equity

by valuing the contribution you will make and we provide arguments to justify a “promoter premium”. This premium is

typically around 5% of a project (just for creating the idea and starting it) but can be less and can be as high as 10%.

Step 3 Transaction Structure -Assumption is a new legal entity will be formed for the project

The valuation of the promoter’s stake is a key job for us. This is one of our parameters in the transaction structure

design. When we design what transaction structure will be optimal we shall keep the following criteria (and more if they

come to light during the project) in mind:

Dilution of the promoter

Interest rates on Debt

Management of many small shareholders

Level of debt available

Level of equity available

Structure of the EU financing (the exact cash flows) and what is financiable with EU funds



Designing a transaction structure is a mix between the results of the optimal capital structure from the financial model

and the offer from the market. In this case the offer we expect will be: own cash from the promoters/Rodipet, bank debt,

EU non-reimbursable funds and possibly PEGs. We work to structure the best transaction for you and we negotiate it

further with investors. At the beginning of the process we do not know the exact final structure because this depends on

offers from different types of buyers. However, we design different scenarios and different exits to make sure they meet

your objectives and make sure you are comfortable.

Step 4 EU Finance

EU finance requires some elements that are common to all finance raise projects: Business Plan and an accurate

diagnosed finance requirement. However, the application process must be followed strictly and each Operational

Programme (“OP”) will have a different Applicant Guide. Moreover, after the funds are disbursed they must be

monitored, and the post disbursement monitoring is important, not to have the funds retracted.

Step 5 Owner/Promoter Coaching/ Preparing the EU File

We prepare our client’s for meetings with investors by simulating the investment analysis an investor will make to

identify weaknesses and correct them, in the use of funds and rate of return. We run a role play meeting where we play

the investor and then we give feedback, with the objective being to have the best performance when it is the real thing.

Sometimes we attend all meetings with clients, sometimes selected meetings to allow the relationship to develop

between the client and the investor. For the EU, we prepare the entire application file(s) and maintain good relations

with the local processors of the application.



Step 5 Negotiation and Terms Agreed

Often we lead the negotiations as our clients want to remain on friendly terms with their new co-investors but it depends

on the specifics of each situation. When all the fundamental terms are agreed we draft a “Term Sheet”, sometimes

known as a “Memorandum of Understanding”, or a “Pre-Contract” or an “Agreement in Principle” which both parties

sign. After this the investor does his due diligence.

This “Term Sheet” acts like a roadmap for the lawyers. We are experienced in working closely with the M&A lawyers

and making sure that they do not move “off target”.

Step 6 Due Diligence Co-ordination

We co-ordinate the provision of data to investors and make sure the investor’s advisors are co-ordinated. If necessary we set up and manage a data room.

Step 7 Closing

We direct and co-ordinate the lawyers to draft the share sale purchase agreement, loan documentation and shareholder agreements. We work with the lawyers to ensure that share transfers and all formalities are properly executed.

EU Funds Implementation Monitoring:

An important part of the EU funds process is the post disbursement monitoring, due to the fact they are not reimburseable. Our consultants can provide this service.


Indicative Timetable

Six months

♦ Complete buyer research

♦ Prepare valuation material

♦ Develop business plan and projections

♦ Develop investment case

♦ IM preparation

♦ Create data room

♦ Brief other professionals

♦ Prepare process letters

♦ Distribute blind profile with NDA

Key value messages and objectives defined

Three Months

♦ Distribute IM (or Biz plan)

♦ Prepare management presentation

♦ Informal management meetings

♦ Indicative offers received

♦ Site visits

♦ Data room access

Value expectations defined

Two Months

♦ Negotiate with several investors

♦ Agree terms with best investor

♦ Sign TS

♦ Draft sale purchase contract

Maintain competitive tension

Four Weeks

♦ Due diligence

♦ Final price negotiations if necessary after due diligence

♦ Closing procedures

Extract final concessions and value

Planning phase Marketing phase Negotiate to Agreed TSDue Diligence, Final

negotiation and Closing

A finance raise process could be completed within one year for a start up.

Note the EU finance raise process has its own path.

IMAP’S CREDENTIALS FOR PROJECT “Rodipet Reciclare”


IMAP’s Credentials for Project Reciclare:

Our relevant experience for this project for Impact is drawn from many years consulting and evaluating businesses in Romania since 1989:

Osprey Partners Romania: in depth experience of valuing Romanian companies and raising finance in Romania. Rachel Sargent has in depth experience analysing Romanian projects and companies. Rachel has valued many Romanian companies and raised finance for significant projects in Romania.

Catalin Dimofte: Catalin is an experienced consultant and a committed ecologist. His MBA thesis was on “Recycling in Romania”. He is a member of the IMAP Industry energy group and he is a specialist in renewable energy.

Emilia Ionescu: Emilia is an experienced consultant with almost 10 years work for NGOs (USAID and EU projects). Her specialisation is rural economics, stimulating small rural communities, artisan business and SME assistance. Prior to 1989 Emilia was a hydraulic pump engineer.


Your IMAP Team

Rachel Sargent,

BEng, ACA, Managing Partner Osprey Partners

Rachel is a graduate in Electronic Engineering and a U.K. Chartered Accountant with 12 years experience in Eastern Europe and the CIS, and five years experience in London, Rachel has lived and worked in Turkey, Belarus, Republic of Moldova, Romania, Tajikistan, Ukraine, Kazakhstan and Russia. Rachel worked for Price Waterhouse (PW) London’s Financial Services Group for three years and Shell Petroleum for two years before rejoining PW for Eastern Europe. At PW Moscow Corporate Finance she was involved in major capitalization projects, the acquisition of Kaztelecom by Daewoo and financial and operational restructuring assignments. Rachel was Head of Research at ABN Securities Romania before working at Bancorex, the former Romanian State Trade Bank, as project manager working with NM Rothschild on the Bank’s restructuring. Rachel has led valuation and business strategy assignments in Turkey on a plastics manufacturer, a packaging company, an automotive component manufacturer and a cutting tools manufacturer and raised finance for a Nickel mine. In Romanian M&A Rachel has raised finance for Romania’s leading printing company, a gas distributor and sold a bank, a retail chain and a machine tool company. Rachel is the President of the IMAP EE&E council.

Geoff Upton,

MA (Oxon), ACA CTA , Partner, Osprey Partners

He is a U.K. Chartered Accountant and member of the Institute of Taxation and graduate of Oxford University with 30 years financial advisory experience, of which 15 years have been spent in Eastern Europe and the CIS, Geoff was a Partner in PW London before moving to Prague in 1990 to open Price Waterhouse Czech Republic and, subsequently Bulgaria and Romania. Between 1996 and 1998 Geoff was head of PW Corporate Finance, Russia and CIS. Significant transactions that Geoff has led include raising two syndicated bank loans for the City of Moscow and the Leningrad region, small company listings on LSE, advising Nestle on acquisition strategies and acquisitions in the Czech Republic and Russia, advice on brewery acquisitions and disposals in the Czech Republic, Romania and Russia, raising private equity finance for a major Romanian communications company, advising a major Romanian CATV operator on raising private equity finance, sale of a Czech manufacturing company to a major German market leader. Geoff worked on the sale of a Romanian supermarket chain to an international Private Equity fund.

Catalin Dimofte,

MSc (Physics), MBA, Partner

Osprey Partners

In the early 1990’s Catalin left his career in optics and magnetic fusion research to become a business & economics reporter.Throughout the late 1990s Catalin freelanced for a large number of (mostly foreign) media, including, but not limited to Bridge News newswire, International Herald Tribune, Business Week, Forbes, Times Magazine, The Independent, The Times, Institutional Investor, Petroleum Argus, The Banker etc.In 1996 and 1998 Catalin broadened his business expertise by taking sabbatical leaves at the University of Michigan Business School in Ann Arbor, USA, and Oxford, UK, as a William Davidson Institute Fellow and grantee of The Wincott Foundation, respectively, studying mostly business planning and strategy. Although he still freelances occasionally and is quoted by Romanian media as an energy analyst, in the 2000s Catalin moved away gradually from frontline journalism into corporate communication and business development consultancy. He took his MBA degree (Finance) Summa cum Laude from the Canadian-Romanian MBA Program in Bucharest in 2002, graduating first in class and specialising in finance. Currently he focuses on strategic planning and financial strategy with Osprey.


Your IMAP Team

Emilia Ionescu

BSC MBA

.

Emilia is a graduate in Mechanical Engineering from Politechnica Bucharest, and also an MBA from ASEBUSS, ODC Enterprises – NGO Management and from Orish Management Institute – Strategic Audit Consultant.

Emilia has been involved in several EU funded projects as follows: “Technical Assistance for the SMEs sector in Romania” as a short term expert on dissemination of support program awareness campaign for project clients and for “Business Development Support Services” .

Emilia has worked as a: business development consultant for CDC – MBA Enterprise Corps and as a public information expert in the “Mining Closure and Social Mitigation Project”, funded by World Bank.

Being a true supporter of Romanian artisans she worked as the President of “Aid to Artisans Romania” for 7 years, encouraging the investments in development and human competence and designing marketing activities, diversifying product development for specific market niches, attracting foreign buyers and creating sustainable rural employment.

Mihai is an enthusiastic investor on the Romanian stock market, and he has worked within Osprey Partners since 2004.

During his university studies he has been actively involved in several students association, he has done marketing for a small company operating in telecommunications and completed various IT and training projects. Mihai studied business management and managerial communication and has graduated in September 2004.

At Osprey he is focusing on industry in-depth analysis and financial modeling. Mihai is now a CFA (Chartered Financial Analyst) Level 1 candidate.

Mihai A. Pop

BSc, Associate Partner

Osprey Partners

.

FINANCIAL PROPOSAL


Fees for Project Inforural

IMAP is a results orientated organisation which links its remuneration heavily to achieving successful outcomes.

Type of Fee Output and Results Guarantee

Euro 5,000

Euro 5,000

Euro 2,500

Euro 2,500

Financial Model, Transaction Structure and Valuation of

Promoter’s Contribution

Business Plan

Teaser and Long List of Investors

Completed EU Application Forms and Files.

Euro 5,000 Signed Term Sheet, Facility Agreement or Approval.

Success Fee of 4% of finance raised, 6% of EU non reimbursable

funds.

A transaction should be completed with the investor providing

the most attractive financial offer and least onerous vendor

guarantees.


Why Work With IMAP?

IMAP’s professionals are really experienced negotiators with the longest M&A experience in post 1989 Eastern Europe

Professionals that all parties trust help in a sale of a large company because success rests a lot on the credibility of the seller and how comfortable the buyer feels

More than 95.0% of our fee comes from success

Are they able to achieve the best results for me?

IMAP is an entrepreneurial, results orientated organization, which is proud of its reputation for fair play , ethical dealings and confidentiality.

IMAP does not make big publicity but focuses on secure and discreet services for its clients

Can I trust IMAP?

IMAP has deep experience working in EE&E post 1989 with private businessmen

IMAP people are independent and not affiliated to any major bank or finance institutionCan I work with them?

IMAP’s AnswersKey Questions

IMAP has a transaction track record that gives immediate access to both large strategic players and all the financial investors. In addition via this team’s personal networks many of the financial investors are known directly.

IMAP’s worldwide marketing and research capability will ensure we reach the buyer universe effectively

Do they have access to the right buyers?

IMAP brings together specialists who understand service businesses and how to negotiate with financial or strategic buyers

IMAP’s professionals will be credible and convincing advocates of your transaction in front of third parties

Do they know about raising finance?


Contact Details

Rachel Sargent BEng, ACA

Managing Partner

E-mail: [email protected]: +40 (0) 722 661 784

Catalin Dimofte, MSc (Physics), MBA

Partner

E-mail: [email protected]

Mobile: +40 (0) 788 236 480

Mihai Pop BSc

Associate Partner

E-mail: [email protected]

Mobile: +40 (0) 723 178 163

Osprey Partners

39, Mendeleev Street

District 1, Bucharest, Romania

[email protected]

Telephone: +40 (0) 21 314 5030

Fax: +40 (0) 21 314 5070

www.osprey-partners.com

Osprey Partners is member of IMAP, the global Merger & Acquisitions organization, formed in 1971, located in 33 countries, employing more than 300 M&A professionals

www.imap.com

Documents

S T R I C T L Y P R I V A T E A N D C O N F I D E N T I A L Professional Services Proposal for Mr Hassan Awdi Project “Rodipet Reciclare” 17 March 2007