ADM CEECAT Recovery Fund

disbursing

The EBRD is considering commiting as an anchor investor up to €60 million in ADM Capital CEECAT Recovery Fund (the “Fund”), a limited partnership to be organized under the laws of the Netherlands, targeting €300 million in commitments. The Fund’s objective is to achieve commercial returns through recovery investing in operationally sound but financially distressed individual companies in Central and Eastern Europe, Central Asia and Turkey (“CEECAT”), where companies or banks are going through debt restructuring. The GP will focus on value-adding to the distressed companies by restructuring, rescheduling, refinancing, debt-equity swaps, and liquidity management; rather than generating its returns from liquidations, hostile take-overs or asset-stripping. The Fund will not take any wholesale portfolio risk on aggregated non-performing loan portfolios. The Bank’s investment in the Fund will have a strong transition impact because of the following features: Sustainability Demonstration Effect The General Partner ("GP") of the Fund will be owned by partners of the firm Asia Debt Management Hong Kong Limited ("ADM Capital", "ADM"). ADM is a Hong Kong Securities and Futures Commission registered Investment Advisor with an eleven year track record of managing distressed assets and special situations in Asia and more recently in Europe. The Bank will commit up to €60 million subject to certain conditions. The EBRD will commit to invest the higher of 25% and €25 million at First Close (where the minimum first close is targeted at €100 million for 2010); to support the GP in its fund raising efforts. If the Fund size exceeds €100 million in first or subsequent closes, the Bank’s commitment will be the higher of 20% of the Fund’s Total Commitments and €25 million. Final Close: The EBRD’s commitment at Final Close will not exceed €60 million (representing 20% of the Funds €300 million Final Close target size). The target size of the Fund is €300 million for final closing. The project has been assigned a screening category of FI, as the EBRD financing is via a financial intermediary. The Fund shall comply with the EBRD's Performance Requirement 2 (Labour and Working Conditions) and Performance Requirement 9 (Financial Intermediaries). The Fund should ensure investee companies comply with national environmental and OHS and labour standards, and given that restructuring of investee companies is likely to involve significant collective redundancies, PR2 requirements on managing retrenchment. The Fund will be required to adhere to the EBRD's Environmental and Social Exclusion and Referral lists, and submit annual environmental and social reports to the Bank. None. Anthony Stalker, Partner of ADM Capital Europe LLP anthony.stalker@admcap.com ADM Capital Europe LLP 22 Upper Brook Street London W1K 7PZ Tel: +44 20 7529 5008 Fax: +44 20 7529 5070