Contents Introduction General Description of Tender Process Threshold Requirements Submission of Bids Evaluation Award Post-Award Actions Principles of Program Contract

Introduction

General Description of Tender Process

Tender Documents –Request for Proposals –Program Specifications –Program Contract Notice of Intent to Bid –Non-binding –Only Bidders who submit such notice will receive notices from the Tender Committee

General Description of Tender Process Cont. Bidders’ Conference –Tender Committee’s discretion Amendments / Clarifications –Tender Committee may issue amendments / clarifications either for itself or in response to requests of Bidders Procurement Library –On-line procurement library –For informational purposes only

General Description of Tender Process Cont. Number of Job Centers / Determination of Geographical Areas –Current Plan: 4 centers, 4 geographical areas, 4 different operators –Tender Committee may increase / decrease the number of centers / geographical areas (up to a maximum of 8 areas) –Exact geographical areas determined by public committee –Bidders will rank the different geographical areas in order of priority

Threshold Requirements

Professional Experience –Experience, during the last 7 years, in the operation of compulsory welfare-to-work programs on a case management basis, meeting the following minimum requirements: Single center responsible for at least 500 benefit recipients for a continuous period of at least 3 years Single or multiple centers responsible for at least 3,000 benefit recipients in aggregate for a continuous period of at least 3 years

Threshold Requirements Cont. Experience, during the last 7 years, in producing a detailed operations manual for a welfare-to-work program and operating a program in accordance with the manual Experience, during the last 3 years, of working with at least 50 employers in aggregate in different fields in the development of job placements Has, during the last 3 years, acquired / developed and used computerized case management and activity report system to monitor participant performance.

Threshold Requirements Cont. Financial Strength –Subject to an external audit for the last three fiscal years –Weighted average turnover of at least $5,000,000 (or the equivalent thereof) for the last three fiscal years –Submission of a letter from a bank or other financial institution confirming willingness to provide financing for the Pilot Program of at least $2,000,000 or the equivalent thereof

Submission of Bids

Contents of Bids –Experience in welfare-to-work programs –Plan and strategies for the Pilot Program –IT –Staffing (including identity of key personnel) –Financial proposal Bid Bond –On-demand bank guarantee / stand-by letter of credit NIS 500,000 Validity –180 days –May be extended by additional periods of up to 90 days

Evaluation

Evaluation Compliance with Threshold Requirements –Tender Committee will only evaluate Bids determined to meet threshold requirements Clarifications/Presentations Evaluation Criteria –Bids will be awarded points based upon the evaluation of the following criteria: –Experience –Plan –Staffing –Financial proposal

Evaluation cont. Best and Final Stage/Negotiations –Tender Committee may conduct a Best and Final Stage, requiring all or certain bidders to amend/improve their bids –If BAFS held, revised bids will be re-evaluated

Award

Award Number of Bids >= number of geographical areas Number of Bids < number of geographical areas –In no event will a Preferred Bidder be allocated more than two geographical areas

Award Cont. Allocation of Geographical Areas –Preferred Bidder with the highest Adjusted Score allocated the geographical area where such Preferred Bidder ranked highest –Next ranking Preferred Bidders each allocated (in order) the geographical area ranked highest by such Preferred Bidder which has not already been allocated to a higher ranking Preferred Bidder

Post Award Actions

Introduction of Israeli partner: –Israeli entity –Size / business experience (based on business contacts in the last year with at least 50 businesses, each employing more than 100 employees in Israel, and at least 10 businesses, each employing more than 500 employees in Israel) –Neither it nor any affiliates engage in either the entry into Israel or placement of foreign workers in Israel –Not a “Budgeted Entity”, a “Public Institution” or “Supported Entity” Israeli entity/ies will hold 25% - 50% of the shares, rights to appoint directors and rights to receive profits of the Operator

Post Award Actions Cont. Incorporation of Operator –Set up Israeli SPC –Shareholders: Preferred Bidder (at least 50%) and Israeli partner/s (25% - 50%) –Operator shall sign the Program Contract

Post Award Actions Cont. Update of Financial Proposal ˉPrior to execution of the Program Contract each Preferred Bidder’s Financial Proposal shall be updated to reflect: ˉActual initial number of participants in the geographical area ˉThe actual average aggregate monthly amount paid to all recipients of Welfare Payments that were subject to the Employment Test in the geographical area

Principles of Program Contract

State of Israel Program Contract Preferred Bidder Operator (Special Purpose Company) Israeli Partner  50%25% - 50%

Principles of Program Contract Cont. Term: –30 months from signature (start-up Period - 6 months; operating period – 24 months) Start-Up Period: –Milestones –Penalties Operating Period: –Program specifications –Operating manual –Applicable law Program Amendment

Principles of Program Contract Cont. Government Options –Extension of term (up to 3 years) –Increase number of participants (up to 7,000) –Additional Job Center

Principles of Program Contract Cont. Securities –Performance Bond On-demand bank guarantee / stand-by letter of credit for NIS 2,000,000 Replenished if drawn up to a maximum principal amount of NIS 4,000,000 –Shareholders’ Guarantee Preferred Bidder and the Israeli Partner(s) guarantee Operator’s performance Joint and several

Principles of Program Contract Cont. State of IsraelOperatorEvent A.Change in eligibility criteria B. Change in amount of Income Assurance Payment  (Subject to specific exemptions) Change in law -  Permits / Licenses -  (Subject to update after 6 months) Increase in number of participants  - (Subject to obligation to mitigate) Failure of NII to perform  Force Majeure Risk Allocation