FIMI Ishay Davidi Ron Zuckerman Roy Machnes

FIMI – Ishay Davidi Ron Zuckerman Roy Machnes

The Need ¢ In thriving and depressed financial markets companies run into performance challenges. ¢ Often the existing shareholders and debt-holders (including the major banks) do not posses the necessary skills nor the financial resources to correct the situation ¢ Frequently banks are forced to deal with the leverage issue and write down their loans while assuming operational control ¢ Moreover, currently all of the Israeli private equity sector is focused on mature profitable companies and not on turn-around situations ¢ There are no distressed situations / turn around private equity funds active in Israel 2

The Solution Establish the first Israeli fund that will have the required skills and focus for turning around mid to large size companies 3

First Israeli Turnaround Enterprise - FITE ¢ FITE is a private equity fund founded by a highly experienced management team with a proven track record of investing, managing and successfully realizing value ¢ FITE brings together three general partners with a unique and complementary set of skills 4

Roy Machnes – Managing Partner ¢ Founder and partner of Mashov Computers Ltd. (Magic, Walla, Babylon, Paradigm Geophysical) ¢ 18 years of experience in daily management of hightech companies ¢ Focused on turn-around in the last 3 years ¢ Completed a number of successful, hands-on, turnaround projects 5

FIMI, managed by Ishay Davidi, is the leading Israeli mezzanine and buyout fund. FIMI has proven its ability to increase the value its portfolio companies utilizing its operational, organizational and financial capabilities 6

Ron Zuckerman ¢ Founder of Magnum – one of the most successful investment teams in the Israeli high-tech industry ¢ Proven track record in turning around high-tech companies and creating value to shareholders 7

Investment Strategy ¢ FITE focuses on large companies with revenues > $40 M ¢ FITE purchases substantial or controlling interests in target companies ¢ FITE focuses on mature companies (not start-ups) that can be improved through restructuring, better management and improved financial resources ¢ FITE will form, implement and execute a turnaround plan and will maintain an active operational role in its investment companies ¢ FITE will seek to make highly profitable exits through strategic acquirers and financial institutions 8

Deal Flow Chart Deal Flow Does the company have significant revenues, significant product, expanding market. Define potential improvements Develop turnaround plan Phase 1 Financial examination of transaction Due Diligence Turnaround plan Phase 2 Purchase control Implement turn-around plan. Stabilize, grow, strategic partnerships 9 Exit

FITE - Structure General Partner LP LP FITE Limited Partnership LP Target Company 10 FIMI Ron Zuckerman Roy Machnes

The Management Team ¢ Managing Partner – Roy Machnes ¢ Associate – Ami Boehm ¢ Investment Committee: Ishay Davidi, Ron Zuckerman, Roy Machnes, Dr. Amnon Goldschmidt (Israel Discount Bank), Robert Joyal (US investors representative) and Avraham Bigger (LP, independent member). 11

Deal Flow The experience and track record of the management team and General Partner in entrepreneurship, operational management, public offerings, and investment activities promises an extensive deal-flow from numerous sources: Banks Investment Companies Managers Consultants Lawyers Accountants 12

FITE – Financing o o o 13 Amount raised – $130, 000 Minimum Investment - $5 million. Terms – 5 years to invest, 7 years full terms, two successive one year extension options Diversification – maximum of 20% of commitments in any single company. Financing Completed – July 2004.

Thank you For further information contact: FITE GP (2004) Ltd. 3 Daniel Frisch Street, Tel Aviv 64731, Israel. Tel: +972 -3 -608 6838 Fax: +972 -3 -608 6839 Email: roy@fiteinv. com