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Investor Presentaiton

A. Industry Sectors There are a variety of industry sectors that may interest Investors. These sectors include: ■ Air freight Cold chain (refrigerated) ■Customs broker ■General commodities Heavy lift Inland barge Intermodal ■Port management Project cargo ■Sea freight ■Supply chain management Third party logistics ■Trucking Warehousing A US transportation and logistics company could encompass several of these sectors or just one, depending on the company's size and complexity. B. Asset-Based or Non-Asset Based The next way to characterize a US transportation and logistics company is by whether it is "asset-based" or "non-asset based." Asset-based: has equipment, trucks, vessels, aircraft, rail cars, terminals and warehouses, perhaps other real estate. ■ Non-asset based: includes for example, third party logistics companies, air or surface freight forwarders, intermodal marketing companies, domestic truck brokers, or non-vessel-operating common carriers (NVOCCS), which have few or no hard assets. An asset-based company is often considered more substantial. If an Investor enters into a venture with an asset-based company, the Investor must conduct due diligence on the condition of the assets. If the Investor will obtain an ownership interest in the US company, it must determine whether the assets are owned or leased, and whether they are used as security for loans to the operating company. If the Investor will be an owner of an asset-based joint venture, the Investor will be required to maintain and upgrade the assets. Additionally, potential liability is greater in an asset-based company. A company operating transportation equipment can face serious third party liability if the human operators or the equipment causes harm to other parties. A non-asset based company's main value is often based on its relationships, clients, contracts, and goodwill, as well as information technology tailored to its customer base. An Investor needs to conduct due diligence on the financial health of those intangible assets. The non-asset based companies are often referred to as "third-party logistics companies" or "3PLs." 6 Garvey Schubert Barer ▲ gsblaw.com
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