Poland – Israel

1. Business Cooperation Overview Poland – Israel Warsaw, June2012

2. Israel – MacroeconomicBackground • Population 7,869,900 • Area 22,072 km2 • Currency Shekel • Capital Jerusalem • HDI ratio 0.888 • FX reserves 76.63 billions of € Source: Embassy of The Republic of Poland in Tel Aviv

3. Poland – Macroeconomic Background • Population38,501,000 • Area 312,679 km2 • Currency Polish Zloty, PLN • Capital Warsaw • HDI ratio 0.813 • FX reserves 70.2 billions of € Source: Central Statistical Office (GUS)

4. Israel Stock Market • The number of listed companies on Israeli Stock Exchange has been remaining on the stable level for 8 consecutive years (about 600 units) and drop slightlyin 2012 • In the same period the number of listed companies on WSE went on the upward trend. Thereare 808 listedcompanies on regulated and alternative market (21 of themare foreign companies) • Average market capitalization on Tel-Aviv Stock Exchange stands at €298.43 m while on Warsaw Stock Exchange €151.19m • Situation on both capital markets has been following the same trend during last decade. Capitalization of Israeli Stock Exchange was exceeding Warsaw Stock Exchange by 50 percent • Since 2006 both stock exchanges incurred damages due to global financial turmoil. Capitalization of both markets dropped by about 40 percent • In 2012 effectiveness of both exchanges reached levels of ca. 170 billions of EUR and 120 billions of EUR retrospectively Source: Stock Exchange in Tel Aviv Source: Stock Exchange inTel Aviv, Warsaw Stock Exchange

5. Foreign Trade – Facts and Figures 1/3 • After the financial crisis in 2009, that has been the first plummet year in trade volume between Poland and Israel, 2011 brings a strong and rapid revival especially on the Polish exports side. Moreover, Poland as the only one country in EU reporting growth in 2009 gained in the eyes of Israeli businessmen and currently is perceived as a stable country with great development and expansion perspectives • In 2009 Poland has been in the black for the first time since many years in terms of Polish – Israel trade exchange • Imports to Israel stood at €283 m that makes 7 percent jump compared with 2010 • Imports to Poland stood at €266 m that makes 8 percent jump compared with 2010 • In 2011 exchange with Poland amounted to ca. 0.4% of Israeli balance of trade turnover Balance of Trade: Poland – Israel Source: Polish Ministry of Economic Affairs Source: PolishMinistry of EconomicAffairs

6. Foreign Trade – Facts and Figures 2/3 • Poland – Israel exchange has concentrated since many years on some group of goods. Poland imports from Israel mainly: • Chemical products including insecticides and herbicides, phosphates, cosmetics, medicines, organic sulfur compounds). These products accounted for 29.1 percent of all Polish imports from Israel • Electromechanical products including integrated circuits, apparatus for telephony and wireless telegraphy, signaling apparatus, instruments and medical equipment, car parts and accessories etc. These group accounted for 25.6 percent of total imports from Israel • Polish exports to Israel mainlyfollowproduct groups like: • Means of transport with23.1 percentintotalexports • Agricultural and food products (20 percent of total exports to Israel) including soft drinks, sweets, chocolate, beef etc). • Electromechanical products (chassis for vehicles, accumulators etc.)– 16 percent share in total exports to Israel, • Chemical industry products including medicines, cosmetics, preparations for oral hygiene. Products represented 10.2 percent of exports volume 3 • Moreover, among the major commodity groups in the structure of Polish exports to Israel are other products like wood, paper and furniture

7. Foreign Trade – Facts and Figures 3/3 • In 2011 23 percent of Polish exports was generated by vehicles and parts • 20 percent of trade volume was created by food article export such as beverages, baking articles etc. • The greatest exporters to Israel are: Man Star Trucks&Buses, XL Energy Marketing, Eko-Vit, Mondi Świecie, PLL Lot, BasellOrlen Polyolefins, Ferrero Polska, Celsa „HutaOstrowiec”, ZakładyMetalowe „Mesko” Source: Polish Ministry of Economic Affairs • In 2011 29 percent of Polish imports from Israel was generated by chemicals suchas pesticides, cosmetics etc. • 26 percent of trade volume was created by import of electrical devices including integrated circuits, engines, turbines etc. • Main importers from Israel are: Makhteshim-Agan, Bumar, AB, Iscar-Poland, Teva Kutno, Fresh World-International, ABC Data Holding, Jeronimo Martins, Eurocast, Hortex Holding Source: Polish Ministry of Economic Affairs

8. Access to the Israeli market • Israel is a member of the WTO, OECD and is an associate member of the European Union. Poland signed with Israel free trade agreement. Only in relation to agricultural products there are some restrictions in the form of tariffs or quotas. Polish exporters are treated on a par with exporters from other countries and there was no application of the specific barriers in this regard • A special type of market access limitation is requirement of kosher. This barrier results from the religious character of a country. Consequently, pork and its products can not be a subject of export to Israel. Generally, for most food (except from meat), lack of kosher certificate is not a problem in imports. It should be emphasized that many Polish products posses kosher certificates, yet Israeli importers willingly cooperate in the field of certification, often incurring necessary costs • Trade procedures, customs and import requirements used in Israel are complied with those of EU • As far as sanitary, phytosanitary and veterinary requirements are concerned, it occurs to be complex to reach any design of necessary certificates. Any products being exported to Israel must meet local standards set by The Standard Institution of Israel. It is the role of Israeli importer to obtain a certificate for particular product • Isreal runs restrictive policy in terms of foreign citizens employment as well as consistent policy of illegal immigrants deportation. Legal employment is possible after obtaining visa with work permit. Such an option is available only in selected sectors of Israeli economy

9. Capital & Investment Cooperation • According to the Central Bank of Poland (NBP) the inflow of direct investment from Israel to Poland in 2009 stood at €13.9 m. Thus, Polish total net outstanding liabilities from Israeli direct investments amounted to € 119.6 m • The most significant Israeli investors active on Polish market are: • Egged – TSL sector company • Super Pharm – network of pharmacies • AganMakhteshim – chemical company that acquired Rokita Agro and TEVA investment into PolfaKutno • Official statistics concerning Israeli investment in Poland differs from estimates. Israeli capital involved in all Polish projects and ventures is expected to reach from 1.51 to 3.8 billions of € • A host of Israeli investors take advantage from Polish tax preferences by investing their financial resources into Polish economy via subsidiaries in Western Europe or in the USA • Other active players on Polish market: • BST, Sorbit, Link 4, Cinema City, GTC, Plaza Centers, Ronson, Yona Group, Karen GAP, ECI Telecom – Tadi Pol, Elite, Eden, Multilock • The most lucrative sector for Israeli investors is real estate. Developers supported by Israeli capital run their investments in main business regions in Poland e.i. Warsaw, Wroclaw, Poznan, Crakow, Łódź

10. Development of bilateral cooperation • Department of Trade and Investment Promotion (WPHI) as well as economic department of the Polish Embassy in Tel Aviv take steps to strengthen business relation between Poland and Israel • Mentioned actions are aimed at arousing an interest of Israeli importers, enterprises and institutions with Polish market. WPHI participates annually in informational and promotional events such as fairs, conferences, seminars, meetings taking benefit from the opportunity to present the offer of Polish companies, culture and investment perspectives • Stimulation of the Polish – Israeli economic cooperation is conducted also through providing detailed information concerning procedures, requirements and provisions for running business in Poland and Israel • Undisputed role in the process of building Polish – Israeli business cooperation is credited to WPHI department in Tel Aviv which regularly publishes offers of Polish exporters, Israeli importers etc • WPHI maintains ongoing contacts with Institute of Export and International Cooperation, Federation of Israeli Chambers of Commerce, Business Association of Israel, Polish-Israeli Chamber of Commerce

11. Situation on Polish financial market1/2 • The greatest impact on the market participants was inflicted by: • fiscal situation in the so-called peripheral euro zone countries (PIGS region) • inflow of negative macroeconomic signals from U.S., EU and China • effects of earthquakes in Japan • Negative trends around the world caused an increase of investors risk aversion, what was reflected in the trading of foreign exchange, shares and commodities indices Rates of 5 – year CDS 2006 – 2010 (basis points) Yield of 10 – year Treasury Bonds 2006 – 2010 (%) 1500 17 1200 14 900 8 600 5 2 300 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 Poland Hungary Germany Poland Hungary Greece Greece Spain Italy Spain Germany USA Source: KNF Source: KNF

12. Situation on Polish financial market2/2 Comparison of spreads for 5 – yearbonds(points) • CreditDefaultSwap is a form of insurance that protects the buyer of the CDS in the case of a loan default. If the borrower defaults (fails to repay the loan), the lender who has bought traditional insurance can exchange or "swap" the defaulted loan instrument (and with it the right to recover the default at some later time) for money - usually the face value of the loan. • Credit default swaps have existed since the early 1990s, and increased in use after 2003. By the end of 2007, the outstanding CDS amount was €45.48 trillion, falling to €26.22 trillion by the end of 2008 4000 Source: KNF Greece Spain Germany 3000 Poland Portugal USA 2000 1000 2010.02.24 2010.08.09 2010.12.23 2011.04.09 2011.08.12 Rates on money market 2006 – 2010 (%) Interest rates of Central Banks 2006 – 2010 (%) 6 6 4 4 2 2 0 0 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 WIBOR3M EURIBOR 3M NBP ECB FED SNB LIBOR CHF 3M FRA 6 x 9 Source: KNF Source: KNF

13. Macroeconomic Review of Poland GDP growth. Poland is the only one country in European Union that reported positive growth rate in three consecutive years during financial crisis and its repercussions. Real GDP growth in 2010 reached 3.8 % y/y. In 2011 GDP growth rate is expected to reach 4.3%. Accumulated GDP growth in 2008-2011 amounted to 15.8%, and was the highest in the EU. Unemployment rate. After reaching peak value at 13.4% in February 2011, the unemployment rate took on a moderate downward trend. Throughout the 2012 it oscillated a bit under 12% to reach 12.5% in December 2011. An average unemployment rate in 2010 stood at 12.4%. According to the Ministry of Labor and Social Policy unemployment rate at the end of 2012 will remain constant and amount to 12.3%. However some international organizations like IMF or EC expect the rate to go south and reach single-digit number. It may be caused by the final stage of preparations of UEFA Euro 2012 which are likely to generate significant number of jobs, especially in hospitality industry. Inflation rate. The Consumer Pricing Index in 2010 stood at 2.6%. Yet from the beginning of 2011 index has been permanently rising to reach 4.5% in December. An average inflation rate in 2011 amounted to 4.3%. According to the NBP’s latest inflation central path projection the CPI will stand at 4.1% in 2012 and decrease to 2.9% in 2013 and 2.0% in 2014. Public finance. Public debt level as a percentage of GDP volume stood at 55.40% in 2010. In 2011 it amounted to 56.4% of GDP. Accumulated public debt growth in 2008-2011 accounted for 5.8% (excl. Open-End Pension Funds) which is one of the best scores in the EU. PMI Index. In December 2010 PMI level reached a 6-year-high at 56.3 points. Such an optimistic level reflects the flourishing condition of Polish economy. Levels over 50 points mean upswing, whereas results below 50 points designate contraction in economic growth. At the end of 2011 PMI Index reached a level of 48.8 points which is a local bottom. Individual consumption. An index in 2010 reported a positive contribution of 3.2%. Over 2011 the index followed a moderate upward trend to reach 3.4% in December.

14. Polish Capital Market 1/2 • Market capitalization of Warsaw Stock Exchange reached a peak in May 2011 of €152 b. In December 2011 it dropped by 27 percent to €108b from May peak. • WIG 20 (index consisting of 20 biggest Polish companies) dropped by 23 percent from 2750 (January 2011) to 2100 points (May 2012) • Average P/E of companies listed on WSE slipped from 16.40 in May 2011 to ca. 8in May 2012, while average P/BV ratio dipped from 1,56 in May to 1.10 in August • Share prices of all listed companies are currently underestimated what can encourage investors to submit purchase orders due to price increase expectations and bear market turn-around • Capital market experts believe that now is a perfect time for companies to acquire at least minority stake in the most prospective firms due to low valuations Source: WSE WIG 20 P/E ratio (2011 – 2012) WIG 20 P/BV ratio (2011 – 2012) Mar Mar Apr Apr Jun Jun Jul Jul Aug Aug Sep Sep Oct Oct Nov Nov Dec Dec Jan Jan Feb Feb May May Source: stooq.pl Source: stooq.pl

15. Dąbrowski Finance cooperationwith Israel Our customers in Poland and in other European markets: • Dąbrowski Finance has well-established business relations with Israeli investors and entrepreneurs • Company currently implements Real Estate projects for huge Israeli investor • Dąbrowski Finance represents the Israeliclients applying to one or more banks or other financial institutions for financing • At every stage of the process, DF cooperates closely with the customer both in drawing up documentation and applying for credit • DF actively supports the customer in creating credit documentation, especially in defining covenants, i.e. obligations to act or to refrain required by the bank We have also established business relations with USA, China and Israel

16. DF Team

17. Disclaimer • The contents of this presentation of the company DF Ltd.. have been collected and prepared to the best knowledge of the author and on the basis of reliable sources. All the presented opinions and assessments of the current market situation express the opinions of the author at the moment of preparing the presentation • DF Ltd. shall not bear responsibility for decisions met on the basis of the contents of the presentation. The Presentation is of solely informative character and its contents should not be regarded as advertisement. offer or endorsement to buy or sell any services or products • The document shall be treated solely as marketing material. it should not be regarded as an offer. advice or investment recommendation or independent financial analysis • All trademarks and brand names mentioned in the presentation are subject to relevant legal provisions. The trademarks or brand names might have been reserved solely for information purposes. Using the trademarks included in the presentation requires the explicit written consent of the authorized entity

18. We strongly invite you to do business with DF in Poland and CEE Dąbrowski Finance Ltd. Trust & ProfessionalismMetropolitan Building 1 Piłsudski Square,3rd floor00-078 Warsaw Tel.: + 48 22 344 04 00 Fax: + 48 22 344 04 10 E-mail: j.dabrowski@dabrowskifinance.eu www.dabrowskifinance.eu 18