Profile 20 October 2009

1. LGC Capital ”Our genesis, our vision our identity” Profile20 October 2009

2. The genesis of our purpose and vision • Market opportunity analysis • Our service offering • Our project risk management approach • Our functional structure and partnerships • Our methodologies • Our charging models and pricing

3. What is our core purpose? • This seeks to answer the question “Why was LGC Capital formed, what is the reason for its existence?” What are we really GOOD at? Our true intentions and goals Our core purpose / mission • Turning ideas into practice/realised value • Understanding strategy • Corporate finance • Understanding technology • Financial and mathematical modelling • Innovation • Corporate law • Harnessing entrepreneurial and intrepreneurial energy and turning it into realised value • Assisting viable businesses to achieve sustainable breakthrough growth • Turning around failing businesses • To get involved in as many high-growth-potential businesses as possible • To create sustainable value in the businesses that we are involved in • To generate substantial annuity income “Our core purpose is to turn vision into value”

4. What are our core values and philosophy? • What do we deem to be the non-negotiables we expect from all our people if we are to deliver on our core purpose? • Quest for true excellence in what we do • Creativity and innovation • Integrity • Excellent customer service • Our philosophy is the main driving force behind our approach toward our work “No problem can withstand the assault of sustained thinking” François-Marie Arouet known as Voltaire (1694 – 1778)

5. What are our visionary goals? • What target do we set for ourselves? What is our burning platform? We aim to have commercialised or have transformed 10 companies to achieve 50% above average sustainable growth rates in 5 years

6. What do we aspire to, what is our vision? Our core purpose “Our core purpose is to turn vision into value” Our values and philosophy Quest for true excellence in what we do; creativity and innovation; integrity & excellent customer service “No problem can withstand the assault of sustained thinking” Our visionary goals “We aim to have commercialised or have transformed 10 companies to achieve 50% above average sustainable growth rates in 5 years” Our vision To help create great South African companies

7. The genesis of our purpose and vision • Market opportunity analysis • Our service offering • Our project risk management approach • Our functional structure and partnerships • Our methodologies • Our charging models and pricing

8. We have analysed the source of funding for South African businesses through the various stages of development and compared it to international markets SME growth phases and funding cycles in the UK1 SME growth phases and funding cycles in South Africa1 Source: SMES’ ACCESS TO FINANCE IN SOUTH AFRICA – A SUPPLY-SIDE REGULATORY REVIEW, The Task Group of the Policy Board for Financial Services and Regulation

9. We have further sought to determine some of the key reasons and implications for the funding challenges faced by businesses in their various development stages Interaction between supply and demand for SME finance1 • The Task Group of the Policy Board for Financial Services and Regulation developed the graph and commented as follows: • Task Group suggested that the diagonal arrow shows the ideal progression, however, it believed that such progression would not be achievable on a large scale, because of the immensity of the SME sector and the logistic impossibility to accompany each of them on the difficult path to a high-skill high-capital status. • The danger is to grow the bottom-right quadrant (low-skills high-capital), which would be an area of systemic risk for the financial sector and should be viewed a “no-go area”. • The task group suggested a progression whereby the emerging enterprises are first provided with more skills (step 1), so that they will be able to formulate a qualified demand for capital and then progress to step 2 • The South African Private Equity sector has a tendency toward later stage investment. South Africa’s early stage investment at 6% of total unrealised portfolio at cost at by 31 December 2008 is lower than North America’s (11%) and Europe’s (9%)2 Step 2 Capital formation high Skill Step 1 Improve organisational skills low low High Capital • A study conducted by the Global Entrepreneurship Monitor (UCT) found the ff impediments to entrepreneurial activity in SA 3 • Shortage of capital (81%) • Business planning (68%) • Insufficient information knowledge (75%) • Quality of employees (57%) • Marketing of products/services (57%) • Entrepreneurship and SME growth are significantly stymied by key skills shortages as skill level is directly proportional to the capacity to raise capital • A method to systematically assist new business and SMEs in the various stages of development with key skills would vastly increase their rate of success • There needs to be more early stage investment in high growth potential enterprises, but this cannot happen if the risk is significantly increased. Therefore a method to limit or manage risk is necessary Source: SMES’ ACCESS TO FINANCE IN SOUTH AFRICA – A SUPPLY-SIDE REGULATORY REVIEW, The Task Group of the Policy Board for Financial Services and Regulation Global trends in venture capital 2008 survey, Deloitte Global Entrepreneurship Monitor South African Report 2007

10. There are significant driving forces behind creating an organised method of rescuing failing businesses 1 Resulting approach and implications • Business rescue is a largely non-judicial, commercial process similar to informal creditor workout : • The process is however formalised following the filing of a board resolution (or application to court to commence the proceedings) and each significant step in the process may allow intervention from affected parties by application to the court. • This, however, remains an engagement amongst the business rescue practitioner/service provider, affected persons (being shareholders, creditors and employees (individually or through their representative trade unions) of the company in devising a business rescue plan to rescue the company • Section 128(1)(b) ‘‘business rescue’’ means proceedings to facilitate the rehabilitation of a company that is financially distressed by providing for - • (i) the temporary supervision of the company, and of the management of its affairs, business and property; • (ii) a temporary moratorium on the rights of claimants against the company or in respect of property in its possession; and • (iii) the development and implementation, if approved, of a plan to rescue the company by restructuring its affairs, business, property, debt and other liabilities, and equity in a manner that maximises the likelihood of the company continuing in existence on a solvent basis or, if it is not possible for the company to so continue in existence, results in a better return for the company’s creditors or shareholders • The major benefits of the approach are: • Breathing space provided by moratorium, and right to cancel or suspend contracts • Cram-down of dissenting creditors, binding holdout Source: Venture Capital in South Africa, Blue Catalyst

11. Our analysis points to significant opportunities in the market • There is a real market need to provide the key skills required by entrepreneurs and small businesses to: • Raise much needed capital • Commercialise or grow their businesses • The skills and capabilities required to commercialise new businesses is very similar if not the same as those required to grow existing corporate businesses. Therefore, there is a real opportunity to provide key commercialisation skills to established corporations looking to grow beyond existing markets • There is a need to manage and reduce risk for private equity investors, particularly the risk associated with early stage investment • The change in company law has created a real opportunity in providing business rescue services • The real driving force behind value creation is strategic capability, specifically: • strategic thinking and • strategic execution Arising market opportunity Skills required to exploit market opportunity • Strategic thinking and capability • Business model design and engineering • Financial modelling • Business process analysis, design and optimisation • Knowledge of company law • Financial management • Business management and leadership • Capital raising • Corporate law

12. The genesis of our purpose and vision • Market opportunity analysis • Our service offering • Our project risk management approach • Our functional structure and partnerships • Our methodologies • Our charging models and pricing

13. Therefore, our integrated service offering coupled with our unique skill set as well as a creative charging model meets a genuine need and gap in the market. Our services are... • Commercialisation solutions • We commercialise viable business ideas and help entrepreneurs and business people realise their vision of creating new businesses • Breakthrough-growth solutions • We provide business, product and channel strategy development assistance to businesses that are seeking to extend their product lines as well as channels to market to increase profit • Business rescue and turn-around solutions • We provide assistance to businesses that are struggling or are in distress on practical means to sustainably return them to profitability • Strategy consulting • We help business leaders to make decisions on various key strategic issues such as, mergers and acquisitions, investment, capital raising etc

14. We bridge the gap between the traditional entrepreneurial and private equity spaces Idea/business refinement and reengineering • Our intervention increases the probability of entrepreneurial/business success • We manage and reduce risk for investors Traditional entrepreneurial space Traditional venture capital space Review viability, research, determine skill and resource gaps Idea generation Fund business Review and define strategy; refine business model; re-engineer business Consider alternatives Build financial models and develop investment case Provide management oversight Consider viability and formulate plan Review and manage risk

15. We apply the same entrepreneurial thinking to established corporate businesses that are seeking to create new value Idea/business refinement and reengineering • Our intervention increases the probability of new venture success in established businesses • We manage and reduce risk with a board perspecite Traditional management approach to new value creation Traditional board expectations to new venture capital space Review viability, research, determine skill and resource gaps Idea generation Approve and fund project Review and define strategy; refine business model; re-engineer business Consider alternatives Build financial models and develop investment case Provide management oversight Consider viability and formulate plan Review and manage risk

16. The genesis of our purpose and vision • Market opportunity analysis • Our service offering • Our project risk management approach • Our functional structure and partnerships • Our methodologies • Our charging models and pricing

17. We have developed a project risk assessment model to help us to consistently determine which projects we should engage in We would not engage in projects where we don’t believe we have a high degree of success, we therefore have developed qualification criteria for projects. We would only engage in projects that score a minimum of 70% in our risk assessment model Pre engagement Project risk assessment Project phase • Initial contact with prospective client • Initial information gathering and research • Initiate projects • Constantly evaluate project risk using project management methodologies

18. The genesis of our purpose and vision • Market opportunity analysis • Our service offering • Our project risk management approach • Our functional structure and partnerships • Our methodologies • Our charging models and pricing

19. Organisation functional structure LGC Capital Strategic delivery partners Commercialisation, Strategy and growth centre of excellence Business rescue centre of excellence Strategic delivery partners Knowledge exchange Capital raising Strategic funders

20. The genesis of our purpose and vision • Market opportunity analysis • Our service offering • Our project risk management approach • Our functional structure and partnerships • Our methodologies • Our charging models and pricing

21. We apply an iterative intellectual model to refine our thinking around commercialisation and breakthrough-growth projects We understand the unique alignment between the opportunities that exist in the conceptual space and the constraints that make for a successful venture in the practical space -Thus the LGC model for value creation Ideas Strategy Feedback Flow Operational planning Corporate strategy Conceptual plane Operations, execution and management Practical plane Financial modelling and planning Practical plane

22. The building blocks of our review analysis and development model for commercialisation, breakthrough growth and turn-around projects Client Business Strategy Design The key elements giving the client a sustainable advantage over competitors Marketing • Marketing strategy • Business development strategy • Product choice and pricing • Market sizing Distribution • Distribution strategy • Distribution partners After sales • After sales requirements • After sales approach Business value chain • Materials purchasing and shipping • Manufacture • Warehousing • Logistics • Distribution • Suppliers Competitor and environmental analysis • Who are the competitors? • What are the key environmental drivers? • What are the implications on client strategy? Key business agreements • Commercial agreements • Supplier agreements • Partnership agreements • IP exchange agreements Business support and process design (HR, ERP and IT) • Business process analysis and design • ERP System design and specification • IT infrastructure and connectivity design and specification • Organisation design • HR policy development • Performance management Financial modelling and execution planning • Market conversion methodology • Sales and expense forecasting • Investment analysis • Micro and macro economic considerations • Project budget • Execution plan • Funder requirements

23. We apply a phased approach toward the management of breakthrough-growth projects Phase 1: Strategy Development Phase: 2 Current situation determination Phase 3 Create the new environment Phase 4 Prioritise Skills Review and refine strategies Review and define environment Implement the change Entrench the change Develop project deliverables Business Process Analysis Activities • Review and refine the organisational strategy • Define strategic priorities • Understand ideal service /product offering to operations • Determine and define the roles of key enablers within the organisational strategy, both now and into the future • Review the current infrastructure, systems and suppliers • Analyse and optimise the current business processes • New business process Mapping • Roll out new business processes • Create new internal capacity • Align internal and external stakeholders • Create new internal capacity • Track and measure the change • Understand the impact of the change • Develop and repair “snag list” Deliverables • A clearly defined and detailed services strategy aligned with the business objectives • Detailed benefits case • Refined set of project deliverables that will serve as the final engagement deliverables • Deliver optimal management approach, departmental structure and KPAs • A stakeholder management strategy • Defined and documented business processes • Change management plan • New systems architecture • New service providers identified • Entrenchment plan • A new more efficient and effective business

24. We apply a phased approach toward turn-around projects Pre-project phase 2 days Project Phase 1 Project Phase 2 Project Phase 3 1 day a month for 6 months Rebuild business Post intervention management Pre Analysis Analyse Stabilise • Review and redefine organisational strategy • Review and redefine business processes, operations, capabilities, management, resources etc • Review and redefine financial strategy and management approach which may include recapitalisation • Develop new performance management metrics • Periodic review of performance against expectations • Operational management support • Get a high-level view on problem and requirements • Determine extent of problem and size of organisation • Determine number and level of resources required to execute • Determine if a successful turn around can be effected and whether to engage on project • Determine information requirements • Agree contract terms • Diagnose main factors causing distress • Determine time-to –failure • Determine if a successful turn around can be effected • Determine key immediate actions that need to be taken • Setup a multidisciplinary Turn-around management team with clear turn-around mandate • Effect key immediate actions

25. The genesis of our purpose and vision • Market opportunity analysis • Our service offering • Our project risk management approach • Our functional structure and partnerships • Our methodologies • Our charging models and pricing

26. We have designed a creative rating model to allow us obtain maximum return from our engagements whilst putting minimal pressure on client finances Risk Premium Calculated from the LGC project risk assessment model Payment Terms LGC Fixed rate Time and material Basic Rating Factors • Project Length • Number and Level of Resources • Materials Basic Rating Factors • Project Length • Number and Level of Resources • Materials

27. We have developed flexible payment structures that would allow clients to chose the most optimal option based on the situation they face

28. Thank you