AL BADIYA

CARS SALES AND RENTAL SERVICES

YEAR 2004

Table of contents Page I.Executive summary 1 II.The Company 1 III.Location 1 IV. Cars rental service 2 V.Investment options 2 Financing the first payment of the car (expected rate of return 15%).....................................2 Financing the whole cost of the car ........................................................................................4 Return on investment (rate of return 14%)..............................................................................5 Ownership in the Companys equity........................................................................................5

Al Badiya S.A.R.L. Investment opportunity - Business Plan For the year 2004

I.

Executive summary

The cars sales and rental industry is one of the most growing sectors in Lebanon. The Lebanese market is in huge need of car rental services. This need is highly noted in the summer season and at holidays where tourists and returning Lebanese have to exercise huge efforts to find a car for rental. Moreover, cars for rentals in the market lack at most times the minimal required standards of a good service and maintenance. Al Badiya for Cars Sales and Rental Services has gathered the knowledge, experience and communication skills, to build a business plan that would make it a leader in the industry. Al Badiya has been in the market since 2001 and in a short time it has gained a high reputation and goodwill that reflects its commitment and expertise. Interested investors are invited to join the bright future of Al Badiya through the following investment opportunity plan.

II.

The Company

The Company is a limited liability company (S.A.R.L.) registered in Baabda Commercial Registry. The Company is specialized in cars sales and car rental services and operates at its location on the International Airport Highway in Beirut - Lebanon. The Company leases, purchases, sells, imports, exports and performs all other trading and car related activities.

III.

Location

The Company is located at The International Airport Highway in Beirut at a distance of 3 minutes drive from the airport, 7 minutes drive from Beirut Center and 15 minutes drive from Baabda.

Al Badiya S.A.R.L. Investment opportunity - Business Plan For the year 2004

IV.

Cars rental service

Cars rental includes providing the clients rental services of all types of cars all over the Lebanese territory, this is done by having a big portfolio of cars estimated to reach 50 cars by the end of year 2007.

V.

Investment options

The Company provides the investors four options to choose the type of investment that bests suits them:

Financing the first payment of the car (expected rate of return 15%)
At the end of each month, the accounting department prepares a summary of the net income (after operating costs) for each car bought by the investors funds. Each investor is provided a list of the cars that were bought by his fund and a guarantee covered by the cars itself. The investor would then receive 50% of the net income generated by the cars bought by his funds in addition to this at the end of the 4 th year the cars are valued at market price and either the investor receives 50% of the car sales price or pays 50% of the car price to Al Badiya SARL and receives ownership of the car paid for. Following is the expected income from one car:

Al Badiya S.A.R.L. Investment opportunity - Business Plan For the year 2004

1 Financing the first payment of the car (continued)

Car cost - New Nissan or Deawoo

Interest-4 years at 11%

Total car cost plus interest Payments by investors: First payment to be paid by investor 50% of registration cost paid by investor Total to be paid by investor Payments by Al Badiya: Balance to be paid on installment by Al Badiya 50% of registration cost paid by Al Badiya Total to be paid by investor Additional balance paid by Al Badiya depreciated Interest charged to car expense Monthly installment - 4 years

USD 15,400 2,640 18,040 4,400 600 5,000

11,000 600

11,600 6,600
2,640

284 8,000

Salvage value after 4 years Monthly income per car Avg number of days rented per month Daily rental fees - USD Total monthly car revenues Direct car costs: Depreciation @ 25% of additional balance Insurance Maintenance Mechanic Finance cost car agency Estimated operating expenses/car Monthly income (Cash) Share of investor - 50% (Cash) Total cash collected by investor per car 4 years At sale of the car after 4 years Share of investor of car sale- 50%

15 30 450 138 43 20 16 55 16 287 163 81 3,902 8,000 4,000 7,902 15%

Al Badiya S.A.R.L. Investment opportunity - Business Plan For the year 2004

Financing the whole cost of the car

This option is similar to option 3 above except that the whole financing is made by the investor (i.e. payment of all installments and car registration). In this case the investor shall receive 70% of the gross return of the car and Al Badia SARL shall pay the maintenance, government mechanic and car insurance of the car. Monthly income per car Avg number of days rented per month Daily rental fees - USD Total monthly car revenues Investor's share of revenues Car cost Car registration Total investment by investor Car residual value Monthly depreciation Net monthly income for investor Return on investment Al Badiya share of revenues: Direct car costs: Insurance Maintenance Mechanic Administrative expenses Al Badiya cost Profit margin USD 43 20 16 16 95
Rate to income 10% 4% 4% 4% 21% 9% 30%

USD 15 30 450 315 15,400 1,200 16,600 8,000 179 135 10% 70%

Al Badiya S.A.R.L. Investment opportunity - Business Plan For the year 2004

Return on investment (rate of return 14%)

This scenario ensures the investor a rate of return on their investment of approximately 14% paid at the end of each year. The investors may withdraw their investment after the 4 th year or may decide to re-invest their funds. The investors funding is guaranteed by car collaterals of value equivalent to the amount funded.

Ownership in the Companys equity

The capital of the Company shall be raised to USD 200,000 split into 2,000 parts each part values USD 100. The founding partners shall contribute to the capital through providing 5 cars already in use by the Company and a 5 years free management contract of Al Badiya Establishment and the parking plot currently in use by the Company (approximately 320m2) which value USD 106,000 thus owning 1,060 parts. Investors who are interested in owning equity in the Company (at a minimum of USD 20,000 investment) shall own equity from the remaining 940 parts which value USD 94,000.