Zimmerman Adams International Zimmerman Adams International Limited Registered in England and Wales No ; Registered Office: One Threadneedle Street, London EC2R 8AW AUTHORISED AND REGULATED BY THE FINANCIAL SERVICES AUTHORITY MEMBER OF THE LONDON STOCK EXCHANGE 2006 Pre - IPO Financing For Russian, Eastern European, and Central Asian Companies

Zimmerman Adams International Ltd Table of Contents  About Pre-IPO Financing Rationale and Basics of Pre-IPO Financing Financial Phases of a Growth Company Typical Practices and Additional Benefits of Pre- IPO Financing  Introducing the ZAI – FMC Pre-IPO Financing JV FMC - briefly Pre-IPO Financing ZAI - briefly  Pre-IPO financing: the Rambler Case Study IPO

Zimmerman Adams International Ltd Rationale for Pre-IPO Financing In emerging markets, successful and dynamic firms look to international financial markets as a source of investment. In turn, companies from emerging markets become attractive for international investors.  Private Equity Placements and Initial Public Offerings (IPO) are popular instruments to raise capital for emerging market companies;  Raising capital, and especially conducting an IPO, is expensive, time consuming, and not without risk;  In these circumstances, Pre-IPO financing is an interesting option …

Zimmerman Adams International Ltd Basics of Pre-IPO Financing Pre-IPO financing is a hybrid instrument. It combines features of both Private Equity and IPO financing. In technical terms, it is a Private Equity Placement that can be used to accelerate an IPO.  In a pre-IPO deal, an Investor acquires a stake in a Company that is considering an IPO, but lacks expertise and/or resources for its preparation. The Company and the Investor work together to prepare the IPO;  The critical advantages of Pre-IPO deals for the Company and the Investor are as follows:  The Investor’s expertise translates into significant savings of time and cost for the Company preparing the IPO;  Higher probability for the Company to raise the targeted amount of capital in the IPO;  Ability to propose a smaller percentage of shares at IPO - lower dilution to existing shareholders;  Provides a budget to offset the high up-front costs of an IPO. Pre-IPO financing is a useful option for Russian companies with growth potential.

Zimmerman Adams International Ltd Typical Growth Company - Financing Phases Private Equity Venture Capital Company Size t P.E. 2 nd round IPO Secondary issues Convertible Bond High Yield Bond M&A Pre-IPO “sweet spot” Target development stage for Russian companies

Zimmerman Adams International Ltd Pre-IPO Financing – Typical Practices  Investment between 24 months and 12 months prior to IPO;  Usual stake does not represent more than 20% of the company, and can be a little as 5%;  Investments are in cash, in return for equity, with an agreed security package as a fall-back plan, should the IPO fail;  Investor will seek an agreed Use of Proceeds. A reliable business plan is a must of Pre-IPO financing.  Control of the Company is not one of the Investor’s objectives; but confidence in a Company going in the right direction is absolutely needed.

Zimmerman Adams International Ltd Pre-IPO financing – Additional Benefits In addition to the obvious benefits to the Company and the Founders of suffering less dilution, the Company will also benefit from the following advantages : Additional cash to meet the fairly large up-front costs of professional advisers necessary to prepare an IPO more time to complete international accounting standard audits. expert assistance in developing acceptable corporate governance practices Experience in managing the complex IPO process Additional media and exposure from the IPO press Contacts in the IPO investors community, from the pre-IPO fund Experience in putting the best Broking syndicate together

Zimmerman Adams International Ltd ZAI-FMC JV for Pre-IPO Financing of Russian Companies Zimmerman Adams International Ltd (London) and First Mercantile Capital (Moscow) have formed a joint venture to provide Pre-IPO Financing for Russian and CIS companies:  Arranging Pre-IPO financing for Russian and CIS companies;  The JV has both extensive emerging markets, specifically Russian experience, and extensive experience handling IPOs on the Alternative Investment Market, of the London Stock Exchange – the most dynamic stock marketplace in the world.

Zimmerman Adams International Ltd The ZAI – FMC JV: FMC First Mercantile Capital, or “FMC” are a Moscow based, Western-oriented Investor Group:  FMC is the Lead Investing Partner in the JV  5 Funds – AUM of +/- $ 300m  Extensive working experience in the CIS environment, mainly in Russia (over 10 years)  One of the highest deal closing rates amongst the CIS-oriented investment banks  Practical experience in resolving the problems facing Russian companies wishing to do a western IPO  The Team that successfully developed Rambler pre-IPO and managed the entire IPO process. Rambler’s major shareholder today. ______________________________________________

Zimmerman Adams International Ltd The ZAI – FMC JV: ZAI Zimmerman Adams International, or “ZAI” are a London- based, independent, internationally focussed investment banking firm, offering a full range of corporate finance, broking and advisory services:  ZAI are the project management and corporate finance advisory partners in the JV  Members of the London Stock Exchange  A licensed Nominated Adviser, or “NOMAD” for the dynamic AIM market  Experienced international management team  International clientele, with companies from the USA, Russia, China, Israel, Argentina, etc.  Acted as the co-ordinating Financial Adviser for the Rambler IPO _____________________________________________________ See the attached ZAI brochure for further details

Zimmerman Adams International Ltd Pre-IPO Financing: Rambler Case  FMC made their initial investment in Rambler in When the initial investment strategy faltered, the FMC management team took charge of strategic and operational management;  Over 3 years, FMC Funds invested a several million US dollars in the companies that now collectively comprise Rambler Media Group;  The FMC management team began grooming Rambler for a Public Market (“IPO”) at an early stage:  Ramblers accounts were audited to western standards  Rambler adopted Western standard corporate governance practices  In July of 2004, Rambler hired the ZAI team to prepare an IPO;  In June of 2005, Rambler did an IPO of their shares on the AIM market of the London Stock Exchange.

Zimmerman Adams International Ltd IPO: Rambler Case In June of 2005, Rambler did an IPO of their shares on the AIM market of the London Stock Exchange: Rambler offered its shares at a price of $10.25 in the IPO, which was oversubscribed; Rambler raised nearly $40 mln. to invest into a several media projects of critical importance for the Company; The Value of Rambler at IPO was set at approximately $170 million; After the IPO, the FMC group of investors retained 52% of the Company; Rambler’s shares currently trade at over $20 per share, having more than doubled since IPO; The Market Value of Rambler (as of 15 Feb 2006) is above $340 million ;

Zimmerman Adams International Ltd Contact Details LONDON: Zimmerman Adams International Ltd New Broad Street House 35 New Broad Street London EC2M 1NH United Kingdom Ray Zimmerman –Ph:+44 (0) –Fax:+44 (0) Dominique Doussot –Ph:+44 (0) –Fax:+44 (0) –Website:

Zimmerman Adams International Ltd Contact Details MOSCOW: "ЭФ-ЭМ-СИ ЭДВАЙЗОРЗ ЛИМИТЕД" Восточная улица, дом Москва Jim Mullins / Джим Маллинс –Ph:+7 (495) –Fax:+7 (495) – Sergei Shilovtsev / Сергей Шиловцев –Ph:+7 (495) –Fax:+7 (495) –Website: