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  • 1. REPORT TEXT LLC «MAXWELL ASSET MANAGEMENT» Investment focus of the fund being setting up is “Life science” (Biotech, medical technologies and equipment). Within this specialization the fund team developed the Concept of key markets being the base of investment process. Concept of key markets is based on 5 principles: 1. Fund invests money in the markets where innovations implementation is crucial for competition winning. 2. Fund invests money in products development, not production setting up. 3. Within key markets Fund conducts active search of companies and products rather than relies on inflow applications. 4. Fund goal: to provide innovators with access to all key recourses necessary for business development, rather than just to make financing available. 5. Fund will aim at creation of integral product lines on key markets so that different companies products would help to promote each other We specificate four key markets (biopharmaceutical, food products, agriculture and industrial reagents) and two important additional markets (R&D service and medical and biotechnological equipment). Key markets are, the first, large markets (with capacity exceeding $10 billion), the second, boom markets (no less than 10 % per year growth for the last 3 years), the third, markets keeping high growth potential for the next 10 years (at least two-fold growth), the fourth, markets with high rollers – potential strategic partners of the fund. Marketing targets to be achieved in the result of fund innovation projects realization are: • Biopharmaceutical market:  Creation of wide spectrum of original (innovation) drugs. • Food products market:  Efficient intensification of the food production.  Development of technologies of deeper processing of primary products.  Localization of food ingredients production in Russia. • Agricultural market:  Development of up-to-date technologies of animals feeding.  Development of veterinary preparations line.  Development and implementation of home biological means of protection and growth promoters of plants. • Industrial reagents market:  Line of bioreagents for oil and gas production and transportation.  Creation of new effective technologies of bioethanol production.  Creation of eco-friendly reagents for PPP production. Projects selection was made by main groups of criteria: • technological, • investment, • organizational, • marketing. Main investment criteria are: • capacity of potential market no less than $ 50 M; • sales starting no later than on 3rd year of project realization, possibility of exit not later than on 7th year; • maximum investments volume in the project of early stage not to exceed $ 1 M, total maximum investments into one company – not to exceed $ 10 M: • project IRR no less than 35% Currently the portfolio includes 26 projects from 10 companies-applicants. 8 of them are described in the memorandum presented and supposed for investment during 1 year of fund operating. Key market concept is set up as an all-in-one structured system: • within each key market target segments are specified; • within each target segment product groups of innovation biotechnological products are specified; PAGE 1
  • 2. • within each product group the pipe line of portfolio products is formed. Biotekch, LLC The company was set up in 1992 on the basis of laboratory of biochemical genetics of SSU. Stuff capacity 100 employees. Sales volume in 2007: 66 M RUR, sales growth 25% Project target Development of effective promoting system for Ronkoleikin preparation. Finalizing of development, registration and publishing to the market of the line of recombinant yeast interferons of human Market $116 M. - volume of interferons market in 2006. Growth rate of the market 15% per year $ 250 M - estimation of the market in 2012. Product Lower cost price as against analogues, less colateral damage, less contra indications and possibility to prolong the treatment Investments Total volume of investments of the Fund - 115 M RUR (about $ 5M). Main direction - increase of market share of the company and development of a line of new preparations - immunomodulators Exit from the Sale to the strategic investor. Such companies as Hoffmann la Riche (Switzerland), Schering- project Plough (USA), Rusian company Biocad can be considered as startegic investors NPP Fermentnye tekchnologii, LLC The company was set up by leading specialists of R&D Institute of genetics, R&D Institute OChBP. Volume of test sales in 2007 - 12 M RUR Project target Finalizing of formation and creation of effective promotion system of package of six SOD- containing products ("main" antioxidants). Market From $500 M to $ 1 billion - SOD sales market. Predictable sales of preparations before clinical tests development: $ 8,4 M -Oculistics $2,3 - Trauma Product Main competitive advantage is identity to ferments produced by human body for its own protection Investments Total investments rate 80 M RUR ($ 3,4 M). Mail direction - increase of the company market share and new preparations development Exit from the 1. Sale to the strategic investor project 2. Subsequent financing of the project on the stage "sales increase", creation of substancial market share, exit of the Fund through IPO For each portfolio company there formed the base of partners whose participation in innovation products development would provide the companies with necessary competences (sales development, contract production setting-up, international cooperation etc.). Strategic Partners of the Fund are such international and the largest Russian companies as Wimm-Bill-Dann, Genencor, AllTech, PO Sibbiopharm, LLC etc. All above mentioned allows the Fund: • To gradually accumulate experience, profits and risk by regulating investments flow depending on projects success. • To gain success in the market, instead of sinking in industrial neverending construsction projects or R&D. • To create integral system in key subject fields, as well as centralized service system (for example, supply of reagents, expendable materials etc.). • To use successful companies as the source of new projects. • To have balanced investment policy and predictable exit from the projects. The specialists team began to take shape in March, 2007 and was structured in full by the end of 2007. Selection of specialists for the team shall be executed by managing company due to diversification of assets being managed and venture investment line development. Regardless results of RVC selection the team will continue its work and will deal with formation of venture fund with or without state participation. It is necessary to note long-term successful cooperation of Avdeenko V., Nebevolenskii M., and Orlova N., resulted in: REPORT TEXT LLC «MAXWELL ASSET MANAGEMENT». PAGE 2
  • 3. • implementation of project on complex upgrade of the CIS largest microbiological production (JV Sibbiofarm); • development of business strategy and attracting of investments into Russian start-up company on the market of test systems of resistancy for anti-tuberculosis drugs; • preparation of development strategy, strategic investor attracting in Biokhimmash company; • working-out of development strategy and international financing attraction for VOSTOC, OJSC (enzyme preparations production); • creation of exclusive in Russia monitoring system of biotech sector. The following is of key importance: • Job experience of Kurakova N. of 7 years in transnational investment company Pragmatic Vision International, LLC. The work resulted in successful exits from projects by selling them to such companies as Procter&Gamble, Intel, Motorola, Bosh-Siemens, Hilti, Ford, Xerox. Experience of successful management of innovation centre of Sechenov ММА, venture business centre of Mirbis IBS. • Job experience of Komarov A. in NP “SBAR”: expertise of 300 innovation projects, on 5 of which investment agreements were signed. Six innovation projects prepared for raising of financing under FCNTP programme. 10 innovation projects presented in presentations within Moscow venture forum. • Experience of Movsesyan O. of 10 years in management of MSU science park (40 innovation companies with annual sales volume of more than 4,5 billion RUR. Experience in the field of business development of start- up companies (IT, Aport.ru, Lumtec, RedLab etc.), leadership of the project "MSU Biotechnological incubator" Taking into account the above-mentioned abilities, experience and achievements of specialists, duties on fund management are supposed to be assigned as the following: • Avdeenko V., Orlova N., Benevolenskii M., - selection, analysis and management of projects in the key markets; • Kurakova N. – international connections, PR and GR management; • Komarov A. - selection, analysis and management of projects of early stage; • Movsesyan O.- business incubations and business development of innovation companies. Scientific expertise of the projects shall be executed by Fund advisors: 1. Grachev Sergei V., RAMS academician, doctor in medicine, professor, secretary academician of medicine & biology department of RAMS, deputy rector in sciense and director of R&D centre of Sechenov MMA. 2. Kubatiev Aslan A., RAMS academician, doctor in medicine, professor, Director of SE R&D institute of general pathology and pathophysiology. 3. Smirnov Vladimir N., RAMS academician, correspondent member of RAS, doctor in medicine, Director of R&D institute of molecular cardiology of Russian cardiology science&industry centre of MPHSD of RF. 4. Sushkevich Gennadii N., professor, doctor in medicine, Deputy director of SE R&D Institute of emergency children surgery and trauma. 5. Tsyb Anatolii F., RAMS academician, doctor in medicine, professor, Director of SE – Medical radiological scientific centre RAMS FUND INVESTORS ARE THE FOLLOWING: 1. MENOSTAR HOLDINGS LIMITED (Cyprus) Target value of to be acquired units: 600 000 000 (Six hundred million) rubles. MENOSTAR HOLDINGS LIMITED is the member of Maxwell Capital financial group and is the holding company for all Russian companies of the group. MENOSTAR HOLDINGS LIMITED has for many years successfully invested in open- end mutual investments funds managed by Maxwell Asset Management Ltd., as well as in Finam – Information Technology close-end mutual investment fund of extra risky (venture) investments. The company also participated in the initial placement of Finam – IT units within Innovation and developing companies sector on MICEX stock exchange on June 14, 2007. It was the first initial placement of venture fund units on a stock exchange in the Russian Federation 2. WALLBROM CONSULTING LTD. (BVI) REPORT TEXT LLC «MAXWELL ASSET MANAGEMENT». PAGE 3
  • 4. Target value of to be acquired units: 427 329 000 (four hundred twenty seven million tree hundred twenty nine thousand) rubles. The owner of WALLBROM CONSULTING LTD. – president of financial group Maxwell Capital Kirpichenko D.P. WALLBROM CONSULTING LTD. is a qualified investor and meets requirements of Regulation on procedure of declaring entities to be qualified investors. 3. Bank Narodny Credit, LLC Target value of to be acquired units: 500 000 000 (Five hundred million) rubles.. Bank Narodny Credit has been for many years the settlement bank for majority of Maxwell Capital group members. Bank Narodny Credit a few times credited different projects of the group. Besides, Bank Narodny Credit is the client of Maxwell Capital company for brokerage and depository services. Bank Narodny Credit is a qualified investor and meets requirements of Regulation on procedure of declaring entities to be qualified investors. 4. RVC, OJSC Investment priorities of the fund being created and its focusing on innovation activities in the field of key trend of science and technology of the Russian Federation – living systems (biotechnology, medical innovations and instrument making) – assist “RVC”, OJSC in solving problems of new innovation companies development in the Russian Federation and venture business culture forming. Maxwell Asset Management company’s involvement in management of biotechnological incubator being created on the basis of Moscow State University Scientific Park, developing of conception of biotechnological part of technopark in Obninsk, organization (in cooperation with MIRBIS Moscow international business school and Innovation & technological business faculty of Academy of national economy affiliated with Government of the Russian Federation) of “Projects Incubator”, as well as close relationship between the company and the leading medical academical and educational scientific centers conform fully to “RVC”, OJSC goals of stimulation and improvement of connections between science, education and innovation business. Intensive creation of strategic alliances and developing of fund’s foreign partners network meet the challenge of “RVC” OJSC in the field of marketing new technologies and technological products being created in Russia in the international market. 5. Individual investors are specialists and advisors of the fund (1,1% of fund volume (33 671 000 RUR) With purpose of RVC interests protection as well as for transparency of project selection procedures ensuring, control over purpose usage of monetary assets and estimation of efficiency of Specialists of Managing company activities there formed Supervisory council, the members of which are: • S.I. Kolesnikov – Chairman deputy of the State Duma committee on health protection. • V.K.Lepakchin – the head of State centre of drug side effect monitoring of the Russian Federation. • V.I.Sergienko – Chairman of Committee on business activity in public health and medical industry of Chamber of commerce and industry of the Russian Federation. • V.M. Cherepov – Director of department on cooperation with sectorial associations of the Russian Union of Industrialists and Entrepreneurs, chairman deputy of medical commission of RUIE. There invited into Supervisory council : • L.M.Roshal’ – chairman of commission of the Public Chamber of the Russian Federation on public health matters. Maxwell Asset Management company alongside with Maxwell Capital investment company, LLC and bank-partner MAXWELL BANK, OJSC, is included in Macwell Capital financial group Today Maxwell Asset Management company is: • The company included in TOP-10 of managing companies of the Russian Federation by net assets value of open-end mutual investment funds being managed; • Pipeline of 16 mutual investment fund being managed, the investment objects of which are: shares, bonds, commercial and residential real estate, as well as units of other investment funds; • 212 sales points in 39 cities of Russia; • 16 000 clients – individuals and legal entities; REPORT TEXT LLC «MAXWELL ASSET MANAGEMENT». PAGE 4
  • 5. • The company having the hHighest rating of assets management quality “A” Thus, main competitive advantages of the Fund are: • Specialized fund. • All-in-one structured system of projects selection and promoting • Balanced project portfolio • Professional fund team • Formed investors’ pool • Strong partners – strategic players on key markets (VBD, Genencor, Alltech, Biocad, Sibbiopfarm, Big Pharma) General director ________________________________ / Petr Vladimirovich Lanin / April 01, 2008 Seal REPORT TEXT LLC «MAXWELL ASSET MANAGEMENT». PAGE 5

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