Cecapaz 500ton 08-12-2009_english

Financing Proposal for the Construction and Start-up of a Cement Production Plant in La Paz, Cesar, Colombia August 2009

The objective of the present document is to determine the terms and conditions for the financing of the construction and start-up of a cement plant in La Paz, Cesar, Colombia. Objective

Agenda ,[object Object],[object Object],[object Object],[object Object]

Market Structure ,[object Object],* Others refers to Cementos del Oriente (0.20%) and Cementos Tequendama (2.01%) Caribbean region counts with 29% of the total installed capacity with Cementos Argos as its only producer. 61.09% 26.66% 10.05% Others* 2.21%

[object Object],[object Object],Market Structure (cont.) * Others refers to Cementos del Oriente and Cementos Tequendama 51% 35% 13% Others* 1%

Plant’s Location Map (Colombia)

Market Statistics TACC 6.3% ,[object Object],[object Object],Source: ICPC Source: ICPC

Market Statistics TACC 9.8% TACC 7.8% ,[object Object],[object Object],Source: ICPC Source: ICPC

Movements in Demand ,[object Object],Source: JPMorgan Global Equity Research, Building Materials 2008

Project Description ,[object Object],[object Object],[object Object]

Project Description (cont.) ,[object Object],[object Object],[object Object]

Know-How ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Know-How (cont.) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Business Upsides ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],The business upsides are based on the plant’s strategic location, which allows it to enter a market where the demand is covered with production from other Colombian regions Source: ICPC

Business Upsides (cont.) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Business Upsides (cont.) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Source: ICPC. Cifras en Miles de Toneladas Source: Banco de la República

Business Upsides (cont.) COP ,[object Object]

Project’s Total Cost ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Project Scheme Project Finance based on the project's ability to generate cash flows to meet its financial obligations with appropriate coverage ratios. Cementos y Calizas de La Paz EQUITY DEBT Sources Fiduciary Agent Company’s Cash Flows The company is proposing the previous scheme to be the warranty of the debt. The company’s cash flows enter a fiduciary agent who will be in charge of paying first the debt service and the remaining cash will go to the company.

Indicative Term Sheet Debtor Cementos y Calizas de La Paz S.A. Arranger Sumatoria S.A. Credit Amount USD 10,500,000. Term Six Years – 2 year grace period. Disbursement Date August 2010. Amortization Semiannual. Prepay Without Penalty. Interest Rate 6M Libor + 4%. Interest Payment Half Expired. Interest Capitalization None Resource Uses Equipment Purchase. Principal Covenants Debt coverage ratios.

Assumptions The principal assumptions used in the financial model are the following: ,[object Object],[object Object],[object Object],[object Object],Source: Calculations done by SUMATORIA 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Price per Package (COP/50kg) 15,497 15,698 16,205 16,395 16,623 16,859 17,104 17,357 17,619 17,891 18,173 18,464 18,766 Market Demand (Thousand Tons) 418.4 278.6 269.6 263.4 259.3 256.5 254.6 253.4 252.5 251.9 251.9 251.9 251.9 251.9 251.9 Annual Production (Thousand Tons) 0.0 0.0 84.3 88.2 92.3 96.8 101.3 101.0 100.8 100.8 100.8 100.8 100.8 100.8 Market Share 29% 30% 32% 34% 36% 38% 40% 40% 40% 40% 40% 40% 40% 40% Plant Use (%) 0% 0% 49% 51% 53% 56% 59% 58% 58% 58% 58% 58% 58% 58%

Cecapaz 500ton 08-12-2009_english

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