The document discusses opportunities for foreign buyers to acquire distressed assets in the United States due to deteriorating economic conditions. It notes that what began as issues in the subprime mortgage market has spread to broader credit and funding market dislocations. This poses risks to the US and global macroeconomic outlook. Deteriorating conditions have led to steep discounts on distressed assets and a more favorable process for buyers compared to previous periods. Expected rises in corporate defaults will further create buying opportunities.

1. International Bar Association Conference Buenos Aires, Argentina Oct. 12 -17, 2008 Credit Markets & Distressed Acquisition Opportunities in the U.S.

6. ©2008 Baker & McKenzie PENDULUM HAS BEGUN TO SWING…..EXPECTED RISE IN CORPORATE DEFAULTS – WILL CREATE BUYING OPPORTUNITIES 8/7/08 estimate of 6.3% by mid ’09; up to 10% in protracted recession GLOBAL CORPORATE DEFAULT RATE Default Rates S&P MOODY’S 1990-1991 Recession IMF Projections Apr. ‘08 1932 U.S. Non-financial speculative grade 3 YR 23.2% by 2010, the worst on record since 1981. U.S. Speculative (Junk) Grade <3% in 2007 7.9% by 12/09 9.43% 1990 5.4% in’00 WORSE CASE 12.3% WITH A BASELINE OF 10.4% U.S. Investment Grade 0% in 2007 4.2% in 9/08 !! Highest since ´94 U.S. All corporate issuer 4.1% July of 1991 9.2% in July of 1932