BEARS LOGISTIC CENTER Kyiv 2007 Project «Building of network of specialized logistic centers for agricultural products storage»

Bears Food Ingredients Concern Organizational structure President Food Ingredients business Commercial property division

Commercial property division Organizational structure Director Bears Center Ltd PAPBS Ltd Bears Logistic Center OJSC

Activity Spheres Building of industrial properties Managing industrial property (Cherkassy) Support function for main food ingredients business Bears-Logistic is looking currently for strategic partner (preferably international) for common logistic project development Bears-Logistic-Center

Strategy of project development

- Bears Logistic Center is planning to create a network of logistic centers - The first logistic distributive center in Kalinovka village (Brovarskoy district) with the total area for first stage of sq meters will be launched in the fourth quarter During the following four years we plan to place in operation about sq meters of warehouses per year in Zhytomyr, Boryspol and other directions - The total area of the centers will be sq meters with investment amounting to $26 m during the next five years. Strategy of project development

Marketing Proportion of storage facilities of A, B, C, D classes

Marketing

Technological description Compliance with the requirements to A-class warehouses Compliance with the requirements to A-class warehouses

Technological description Location in close proximity to main highways; Location in close proximity to main highways; One-stored building, ceiling height 10 m and more; One-stored building, ceiling height 10 m and more; Concrete floors with anti-dust surface; Concrete floors with anti-dust surface; Floor loading - 5,0 tones/1 sq.m Floor loading - 5,0 tones/1 sq.m Column grid– 12х18 m; Column grid– 12х18 m;

Technological description Availability of office space. Availability of office space. No less than 50% warehousing areas have special storage conditions for agricultural products. No less than 50% warehousing areas have special storage conditions for agricultural products. Professional operator at agricultural wholesale market. Professional operator at agricultural wholesale market. Company specialized in commercial property management. Company specialized in commercial property management.

Technological description Security system; Security system; Autonomous heat and water supply systems; Autonomous heat and water supply systems; Backup power supply; Backup power supply; Automatic fire alarm and fire fighting systems; Automatic fire alarm and fire fighting systems; Air conditioning and ventilation systems; Air conditioning and ventilation systems; No less than 1 dock per 500 sq. m of storage space. No less than 1 dock per 500 sq. m of storage space.

Technological description Office and storage facilities complex in operation (Cherkassy) Office and storage facilities complex in operation (Cherkassy)

Income and sales

Sales revenue forecast Sales revenue forecast Item, USD Sales Revenue (managing company) Rent (warehouses) Rent (offices) Revenue from warehouses disposals Warehousing services (own warehouses) Warehousing maintenance (for disposed warehouses) Total Revenues, USD

Financial indicators, 000 USD From 2007 to 2011 Revenue is constantly increase from 0,3 MUSD up to 7,8 MUSD. From 2007 to 2011 Revenue is constantly increase from 0,3 MUSD up to 7,8 MUSD. Project show profit already starting from second year. In Y2008 Net Profit will be equal to 1,7 MUSD and in 2011 will increase up to 2,9 MUSD. Project show profit already starting from second year. In Y2008 Net Profit will be equal to 1,7 MUSD and in 2011 will increase up to 2,9 MUSD. GPM during whole period is on very height level 58-65% - this is significant benefits for this project and underline the height investment attraction for this project GPM during whole period is on very height level 58-65% - this is significant benefits for this project and underline the height investment attraction for this project EBITDA indicator is constantly increase from 2.9MUSD in Y2008 up to 4.8 MUSD in Y2011 EBITDA indicator is constantly increase from 2.9MUSD in Y2008 up to 4.8 MUSD in Y2011 NOPAT will increase from 2MUSD in 2008 up to 3.2 MUSD in 2011 NOPAT will increase from 2MUSD in 2008 up to 3.2 MUSD in 2011

Capital investments and recurrence At the end of Y2006 the total fixed assets cost was equal to 4,6 MUSD from which 3.5MUSD was share capital and 1.1MUSD – long term financing At the end of Y2006 the total fixed assets cost was equal to 4,6 MUSD from which 3.5MUSD was share capital and 1.1MUSD – long term financing Total investment forecast for makes up 14.6 MUSD. Total investment forecast for makes up 14.6 MUSD. The expected investments into fixed assets till the end of 2011 make up 13.5 MUSD. The rest 1.1 MUSD will be used as investment into WC The expected investments into fixed assets till the end of 2011 make up 13.5 MUSD. The rest 1.1 MUSD will be used as investment into WC The structure of capital: in 207 will consist from 5.8 MUSD of share capital and 1.8 MUSD of long-term credits. in 2011 we expect to have 12.1 MUSD of share capital and 2.5 MUSD of long-term credits. The structure of capital: in 207 will consist from 5.8 MUSD of share capital and 1.8 MUSD of long-term credits. in 2011 we expect to have 12.1 MUSD of share capital and 2.5 MUSD of long-term credits. The suggested strategy will ensure the increase of payback on the invested capital from -0,5% in 2007 to 22% in The suggested strategy will ensure the increase of payback on the invested capital from -0,5% in 2007 to 22% in 2011.

Cash Flow Positive Cash Flow are generated already started from Y 2009 Positive Cash Flow are generated already started from Y 2009 Payback period fro investors with 2.8 MUSD investments will be less then three years Payback period fro investors with 2.8 MUSD investments will be less then three years

Market value The calculation of the Group’s market value is based on the Company strategy and discounted cash-flow. At the same time the company’s value is calculated based on EBITDA (starting from 2008) indicator with the estimation of averaged market value. By the end of 2007 the company’s market value will amount to circa 7,5 MUSD USD and will continued grow up to 24 MUSD till Y2011. The calculation of the Group’s market value is based on the Company strategy and discounted cash-flow. At the same time the company’s value is calculated based on EBITDA (starting from 2008) indicator with the estimation of averaged market value. By the end of 2007 the company’s market value will amount to circa 7,5 MUSD USD and will continued grow up to 24 MUSD till Y2011. Calculation discounting rate – 12% (in compliance with the interest rate of loan capital). Calculation discounting rate – 12% (in compliance with the interest rate of loan capital). The market value will grow owing to the increasing trust of the market to the Group’s long-term strategy. By the end of 2011 the OJSC Bears-Logistic-Center Equity market value will make over 17.3 MUSD. The market value will grow owing to the increasing trust of the market to the Group’s long-term strategy. By the end of 2011 the OJSC Bears-Logistic-Center Equity market value will make over 17.3 MUSD. There is possibility to revaluate FA taking into account assumption of premises price increase. At the end of Y2011 even using current sales price the total FA value will be equal to circa 31 MUSD. There is possibility to revaluate FA taking into account assumption of premises price increase. At the end of Y2011 even using current sales price the total FA value will be equal to circa 31 MUSD. Thus will give us added value from Real Estate MV over 11 MUSD. Thus will give us added value from Real Estate MV over 11 MUSD.

Project risks Lack or reduction of demand. Lack or reduction of demand. Commercial risks. Commercial risks. Strategic risks. Strategic risks. Political risks. Political risks. Risks connected to goods supply. Risks connected to goods supply.

Shareholder benefits The Group’s financial indicators allow paying dividends at a level of 30% starting from Y2009 The Group’s financial indicators allow paying dividends at a level of 30% starting from Y2009 Value added for the Group’s shareholders will equal to 26.4 MUSD and will consist out of: Value added for the Group’s shareholders will equal to 26.4 MUSD and will consist out of: dividends – 1,7 MUSD;dividends – 1,7 MUSD; the increase of shares’ market value– 14,9 MUSD;the increase of shares’ market value– 14,9 MUSD; Added value from Real Estate MV – 9,8 MUSD.Added value from Real Estate MV – 9,8 MUSD.

Proposal for Investor and his benefits Investor entering scheme. Investor entering scheme. We propose next scheme for investor entering: We propose next scheme for investor entering: Sales of 40% of OJSC Bears-Logistic-Center shares to investor in 3-rd quarter 2007 for amount equal to 2.8 MUSD by statutory fund increasing

Proposal for Investor and his benefits Company Market Value in Y Company Market Value in Y 2011.

Proposal for Investor and his benefits Sales Revenue Sales Revenue

Proposal for Investor and his benefits Value added for the Investors will equal to 10,56 MUSD and will consist out of: Value added for the Investors will equal to 10,56 MUSD and will consist out of: dividends – 0,68 MUSD;dividends – 0,68 MUSD; the increase of shares’ market value– 5,96 MUSD;the increase of shares’ market value– 5,96 MUSD; Added value from Real Estate MV – 3,92 MUSD.Added value from Real Estate MV – 3,92 MUSD.

Proposal for Investor and his benefits – Construction firm Within the bounds of this project the Construction firm is offered to become a Co-investor of the “Bears Logistic Center” Project. Within the bounds of this project the Construction firm is offered to become a Co-investor of the “Bears Logistic Center” Project. The Investor is offered to become a prime contractor of construction works of all other posterior projects. The Investor is offered to become a prime contractor of construction works of all other posterior projects. The potential Investor is offered to enter the Project with 40% by means of supplementary emission at the rate of MUSD. The potential Investor is offered to enter the Project with 40% by means of supplementary emission at the rate of MUSD.

Proposal for Investor and his benefits – Construction firm Additional benefit of the shareholder – prime contractor since 2007 till 2011 will amount to 5,3 MUSD Additional benefit of the shareholder – prime contractor since 2007 till 2011 will amount to 5,3 MUSD Benefits of the main works Benefits of main contract works

Proposal for Investor and his benefits – Construction firm In 5 years the Investor – Construction firm will collect an extra income amounting to MUSD (including 680 USD as dividends and MUSD as a profit on implementation of building and construction works). In 5 years the Investor – Construction firm will collect an extra income amounting to MUSD (including 680 USD as dividends and MUSD as a profit on implementation of building and construction works).

Development strategy for Network of specialized logistic centers in whole Ukraine development Network of specialized logistic centers in whole Ukraine development

Development strategy for Till the end of 2016 Bears Logistic Center plans to build minimum sq.m of warehouses and sq.m of office space in regional centers of Ukraine. Till the end of 2016 Bears Logistic Center plans to build minimum sq.m of warehouses and sq.m of office space in regional centers of Ukraine. At the same time turnover will grow up over 15 MUSD over the year At the same time turnover will grow up over 15 MUSD over the year Company Market value will grew up till 2016 over 50 MUSD Company Market value will grew up till 2016 over 50 MUSD