Oliver Sintobin, MBA President & CEO XL Group, Inc.

FEI – October 10, 2006 The Goose that Lays a Golden Egg is Force-Fed by the Currency Exchange Rate Oliver Sintobin, MBA President & CEO XL Group, Inc.

10 Reasons to Export to Europe now more than ever 1) Europe is a larger market than US 2) Europe is 7 hours ahead of us 3) Europe has a single currency 4) English is the business language 5) US products are known for their quality

10 Reasons to Export to Europe (cont’d) now more than ever 6) Strong relationships 7) US Government wants to help 8) Exports will increase cash flow 9) Labor Cost per Hour 10) Currency Exchange Rate

1. EUROPE IS A LARGER MARKET States 50 48 Pop. 299 million 665 million Sq mi 9,704,200 4,010,000 GDP $11,190 trillion $13,329 trillion Growth 4.4% 1.5% Imports $1,480 billion $1,304 billion Exports $795 billion$1,223 billion Inflation 2.5% 2.1% Poverty 12.4% 17% Unempl. 5.5% 9.1% http://en.wikipedia.org/wiki/Economy_of_the_European_Union

2. EUROPE IS 7 HOURS AHEAD OF US =>Allday to work on orders / issues

3. EUROPE HAS A SINGLE CURRENCY EURO

4. ENGLISH = BUSINESS LANGUAGE

5. US PRODUCTS = QUALITY • Electronic • Medical • Pharma • Food • Apparel • Machinery • Franchises • Entertainment • Appliances • Fitness Equipment

6. STRONG RELATIONSHIPS Companies = People = Relationships

6. STRONG RELATIONSHIPS = PARTNERS For whom are you a Partner? Who is your Partner? Who is winning more in this Partnership? http://www.worldcitizensguide.org/

7. US GOVERNMENT WANTS TO HELP How? • International Market Research • Export-Development Activities like Tradeshows • Business Development • Check up on Credit Worthiness • Verify the Harmonized Code • Revolving Lines of Credit for Export Purposes • Loans for Export • Financing Standby Letters of Credit

8. EXPORTS WILL INCREASE CASH FLOW SBA Export Express Loan • Made by commercial lender • For at least 1 year old small US Businesses • The foreign buyer must be creditworthy • Maximum loan amount of $2,000,000 • For a period of 12 months • Guarantee fee of 0.25% • Fully collateralized at all times • www.sba.gov.oit – 817-310-3749 (Rick Schultz)

9. LABOR COSTS PER HOUR Lower Labor Costs in US } $4.24 = 21% $20.40/hr $24.64/hr

10. CURRENCY EXCHANGE RATE MUCHLower Value of the US$ compared to the €uro $1 = €0.783 €1 = $1.277 28% Difference

Our Competitive Advantage = USA Competitive Advantage of 49% 28% Currency Exchange Difference 21% Labor Cost Difference $ 0.33 --> 58% $ 0.52

Results EXPORTS (after 5 years) OR CONCEPTS 38% VETEX 21% PREOX 33% HANNA ISUL 0%

Export, Export, Export Where to get help • US Department of Commerce • (817) 310-3744 - www.export.gov • International Trade Center (SBA / SBDC) • (214)747-1300 - www.iexportimport.com • Your bank’s international department • Export Councils of Texas (www.exporttexas.com) • Export Management Companies • (214)350-1505 - www.xl-group.us

Export, Export, Export • Thank you Very Much Gracie Molto • Muchas Gracias Obrigado Muito • Merci Beaucoup Большое спасибо • Dank u Veel Σας ευχαριστούμε • Vielen Dank ありがとう

Export, Export, Export Oliver Sintobin 214-350-1505 www.xl-group.us oliver.sintobin@xl-group.us http://www.xl-group.us/files/NoTBS_Seminar_-_Export3.ppt

Oliver Sintobin, MBA President & CEO XL Group, Inc.