This document is solely for the use of NetLogistik.

No part of it may be circulated, quoted, or reproduced for distribution without prior written approval from NetLogistiK.

Este plan de negocios fue donado por NetLogistik a Endeavor México

CONFIDENTIAL

Business Plan- Draft

May 28, 2000

This report is confidential. No part of it may be circulated, quoted, or reproduced for distribution without prior written approval from Emerald Internet Ventures.

Confidential - Emerald Internet Ventures

CONTENT

Executive Summary 1. Industry overview • • • • • Business concept NETLogistiK product offering Competitive landscape Financials Implementation

Appendix

1

Confidential - Emerald Internet Ventures

EXECUTIVE SUMMARY

What is the Business Concept?
NETLogistiK is an electronic logistics marketplace Ù NETLogistiK will develop an Internet based B2B logistics marketplace in Latin America with the objective of allowing shippers t o manage and contract their freight transportation needs more efficiently. NETLogistiK will focus on the medium/large cargo market. The line of service will range from single to multiple truckload shipments.

What is the opportunity?
The market is attractive – large, fragmented and inefficient Ù The Latin American for-hire transportation market is calculated at $50-60 billion Ù NETLogistiK will originally focus on trucking, which represents around 80% of the market Ù Preliminary estimates show that NETLogistiK could generate revenues in the range of $250 million by 2003/4 Ù The industry is highly fragmented. Top 10 players have less than 2% market share Ù Shippers have to rely on several carriers to fulfill their shipping needs. The average medium/large-size company in Latin America interacts with over 15 carriers Ù Currently there is no efficient way to contract and compare shipping services The marketplace solution is attractive to both shippers and carriers Ù Shippers will benefit in terms of transportation cost and service by extending the choice of carriers and reducing purchasing costs Ù Carriers will benefit from expanding their customer reach and the opportunity to optimize back haul loads (return trip) The development of e-commerce will fuel the size of the market further Ù The surge of electronic commerce will add to the number of shipments by promoting trade across geographies Ù Additionally, the frequency of shipments will increase as a result of more coordination and communication across companies.

2

g. Ù We expect to achieve economies of scale by sharing the technology across several markets Is this a proven model? Similar models are working in the U.g.5%. NTE.) How will NETLogistiK business model work? Main revenue will come as a percentage of transactions Ù NETLogistiK will derive most of its revenues from transaction commissions (e.Emerald Internet Ventures EXECUTIVE SUMMARY (Cont. it will generate revenes from other products/services such as customs advisory.S Latin America is still up for grabs! Ù Similar business models are already working in the U. warehousing cargo u and management. cargowerks charges 2. Ebay. Argentina and Brazil to then expand to other attractive markets t . CarrierPoint.Confidential . carriers shippers using stock and options Ù Shipper acquisition will be through joint marketing agreements with B2B verticals and through targeted sales efforts focused o leading brick and mortar companies.5% Additionally. CommerceOne. US players have received $50 million in funding. it is behind the U. Ù Latin America is largely untapped. However. Operations will focus on main Latin America markets n Ù Operations would first star in Mexico.. carrierpoint charges4. and still in a very early stage.g. and an average forwarder marginsis 12%) 3 . will offer a vertical market of spare-parts for trucks (e. and clearing services Ù Once NETLogistiK captures a critical mass of trucks in the system. -3.S (e. etc ) Success will be based on early alliances and partnerships with key players Ù To begin operations NETLogistiK will develop alliances and partnerships with key forwarders. Celarix. 1 in line with industry standards(e. operating margins (50%) similar to those of other virtual marketplaces (e.5 1) and cargo insurance referral. tire s it and purchasing aggregation servicesfor gas and lubricants High-margin business Ù This web-enabled intermediary model will benefit from lowcapital intensity andhigh operational leverage Resulting in high . There is no competitor that has entered this region capable of rationalizing the transportatio market yet.0%..S.. Successful IPO’s may follow.g. Investors seem to have great confidence in this business model. over Ù The European market has seen some sites coming to market. 2.).g.

In the process of structuring an advisory board with industry experts and influential business people ( CEOs of leading e. In the process of recruiting more logistics/ transportation industry experts.g. McKinsey. This ev was reported in newswires and in the cover page of Wall Street Journal Americas. operations.g. e -commerce) Combination of local business management with US -work experience Contacts with local players and governmental authorities Network of professionals/MBAs throughout Latin America Access to US business networks (e. companies. People Structured initial phase teams for Mexico and Argentina. Buenos Aires and Sao Paulo.. ent Partnerships with carriers Established partnerships/ initial participation agreement with key carriers in Mexico and Argentina.) 4 . Partnerships with shippers Established initial participation agreement with shippers in Mexico and Argentina Launched main offices Established presence in Mexico. Morgan Stanley.Confidential . etc) What have we done so far? Strategic alliance with CarrierPoint Established alliance with leading transportation marketplace. In conversation with key people in Brazil. CSFB. e tc. CarrierPoint will license its software solution and share its industry US know-how. Both companies will work together to solve inefficiencies of shipments between Mexico and the US (largest trading bo in the world). Advisory Board.) Strengths of the management team Ù Ù Ù Ù Ù Diverse top notch management expertise (consulting. Industry experts.Emerald Internet Ventures EXECUTIVE SUMMARY (Cont.

Industry overview • • • • Business concept NETLogistiK product offering Competitive landscape Financials Appendix 5 .Emerald Internet Ventures CONTENT Executive Summary 1.Confidential .

Confidential . SCT. US Department of Commerce 6 . Journal of Commerce.Emerald Internet Ventures ESTIMATE WORLWIDE COMMERCIAL FREIGHT TRANSPORTATION REVENUES.BY SEGMENT $ Billions Worldwide Transportation Revenues Pipeline Air Rail 6% 4% 4% Trucking revenue breakdown Percentage 100% •Movement of cargo within countries is dominated by trucking (77%) •Within this mode large size shipments (LTL and TL) account for 87% of the revenue •NETLogistiK will initially focus on these two segments Ship 9% Trucking 73% 77% 14% 13% 100%= $900 bn Parcel/ Small packages Less Than truckload (LTL) Full Truckload (TL) Total Source:S&P. GEIPOT. McKinsey & Company.

US Department of Commerce Source: 7 . Journal of Commerce.Confidential . Does not include shipping across regions Source:S&P.Emerald Internet Ventures ESTIMATE WORLWIDE COMMERCIAL FREIGHT TRANSPORTATION REVENUES.BY REGION $ Billions Latin America 55 US Asia 240 350 The U. and European markets account for most of the transportation industry. GEIPOT. the size of the market is so big that even Latin America’s 6% share represents a very attractive market ($55 billion) 255 Europe 100%= $900 bn* *Standard & Poor’s. However. McKinsey & Company. SCT.S.

books U.S..S. SCT. electronics …and the purchasing process is very inefficient. even relative to many other industries in the US * Includes commercial transportation in all modes.Emerald Internet Ventures WHAT IS THE OPPORTUNITY IN LATIN AMERICA? Industry revenues $ Billions 100 70 55 26 12 U. IBGE.Confidential . prescription drugs U. … • Latin America spends 3-4% of its GDP in cargo transportation* • This $55 billion market represents a very attractive opportunity. Med Ad News.S. • No price transparency • Average medium/large-size company in Latin America interacts with over 15 carriers by channels such as phone and fax • There is no efficient way to contract and compare shipping services … the industry is highly fragmented.. • Top 10 players have less than 2 % of market share • Shippers have to rely on several carriers to fulfill their shipping needs It’s a large market. Goldman Sachs. IMT.S. GEIPOT 8 . does not include inter-regional transportation Source: Standard & Poor’s.. Alcoholic Beverages Latin American Transportation market* U.

Confidential . Chile. GEIPOT. Subsecretaria de Programacion Economica (Argentina) 9 . support from local governments is expected 14-19 18-20 Brazil Mexico Argentina Others* Total * Venezuela. and Argentina •Freight transportation represents a centerpiece of these countries economic output (3-4% of GDP) •Additional transparency and reduction of inefficiencies may have a dramatic impact on these countries productivity •Therefore. 1999 50-60 8-10 10-11 •The largest Latin American transportation markets are Brazil. Colombia Source: Goldman Sachs.SCI. Mexico.Emerald Internet Ventures ESTIMATE LATIN AMERICAN COMMERCIAL FREIGHT TRANSPORTATION REVENUES $ Billions. IMT.

Top10 carriers own less than 2%of the trucks 350.6% Other TBD •Over time NETLogistiK expects to have at least 5% of the trucks registered and operating in its electronic marketplace Source: Instituto Mexicano de Transporte.000 300.0% Mexico 1.Emerald Internet Ventures NUMBER OFCOMMERCIAL TRUCKS* FOR THE MAIN LATIN AMERICAN MARKETS ESTIMATE Number of trucks 700. which improves information and provides liquidity to the system •The number of trucks in the system was used to build a bottom-up revenue model (see financials) Brazil % of the trucks owned by top 10 carriers < 2.000 200.000 •This environment provides an ideal opportunity for a solution like NETlogistik.Confidential .000 •The market is highly fragmented.5% Argentina 1. GEIPOT(Brazil). Interviews 10 . Comision Nacional del transporte terrestre (Argentina).

Emerald Internet Ventures CONTENT Executive Summary 1.Confidential . Industry overview • • • • Business concept NETLogistiK product offering Competitive landscape Financials Appendix 11 .

Confidential . Third Party Logistics (3PL). Others 12 .Emerald Internet Ventures BUSINESS CONCEPT Shippers/ Senders Carriers/ Transportation Companies B2B Logistics Marketplace • NETLogistiK will develop a Latin Americas Internet B2B marketplace that will allow shippers to compare shipping options and contract transportation services online Manufacturing companies Medium/Large Cargo Market • The line of service will range from single to multiple truckload shipments Services/Products • Spot contracts marketplace • Excess capacity auctions • Multiple/ complex shipment negotiation tools • Cargo insurance • Customs and tax advisory • Warehousing and cargo management • Infrastructure hosting • Clearing and payment options • Others (vertical market of spare parts) Warehouses NETLogistiK Freight intermediaries and consolidators* B2B Verticals Latin American B2B Logistics Marketplace * Forwarders.

.. • One-stop-shop option • Simpler /automated purchasing process • Liquidity reduces prices and costs • Wide access to network of shippers/carriers 13 .... • Many layers of intermediaries • Manual/ time-consuming purchasing process • Lack of price transparency • Sub-optimal truck utilization (e.Emerald Internet Ventures INTERNET WILL CHANGE THE BUSINESS DYNAMICS Today Future Forwarders Warehouses Forwarders Warehouses Shippers B2B Verticals Carriers Shippers B2B Verticals Carriers From.g.Confidential . trucks return empty from destination) To.

benefits will clearly outweigh the forces against adoption From Carriers •Fear of losing control •Fear of competition •Lack of trust in the system 14 .Emerald Internet Ventures BENEFITS FOR SHIPPERS AND CARRIERS WILL DRIVE MODEL ADOPTION Benefits For Shippers •Access to a larger base of carriers •Lower prices and more transparency •Simplified purchasing process •Access to standardized transaction information •Access state-of-the-art technology For Carriers •Improve truck capacity utilization (return trips) •Access to a larger customer base •Low-cost sales channel •Simplified selling process •Access to state-of-the-art technology Forces against adoption From shippers •Fear of changing current practices •Fear of doing transactions over the internet •Lack of internet access Although it might take some time.Confidential .

CarrierPoint seems to be the company that is developing at the fastest pace Source: Webpages.S. providing more publicity for the model (GF-X) Global Freight Exchange is an Internet-based market to buy and sell air cargo capacity American Airlines. UPS.Emerald Internet Ventures THIS BUSINESS MODEL IS ALREADY WORKING IN THE U. Resource Link. Panalpina $45 million in first round * Although it started in mid 1999. press clippings. SAP. etc Funds raised $20+ million in second round NTE Real time exchange that focus on using transportation capacity efficiently. It has a rating system that enables shippers and carriers to evaluate potential partners Key partnerships IXL. L.com. It includes a real time neutral exchange Retail.Confidential . Circle International. setting minimum prices Ariba. AND EUROPE Players CarrierPoint* Concept Dynamic marketplace for trucking services . British Airways. Tiredex.com ChemConnect. DHL. Bean. RossetaNet $59 million • IPOs may follow.L. investing over $50MM in some of these companies Celarix Web-based logistics solutions for shippers. Manugistics $50 million in fourth round •This is a proven business in the US and Europe • Investors already bought-into the concept. interviews 15 . HP.com. NTE acts as a broker .

Industry overview • • • • Business concept NETLogistiK product offering Competitive landscape Financials Appendix 16 .Emerald Internet Ventures CONTENT Executive Summary 1.Confidential .

information and news Upload tracking status of shipments Track shipment $ Settle on-line 17 .Confidential .Emerald Internet Ventures NETLOGISTIK FUNCTIONALITY Shipper Post requirements • • • • Origin/Destination Cargo specifications Dates Others • Rates • Routes • Services Carrier Upload rates and availability Select audience Receive list of quotes and select best option Negotiate and close transaction on-line •Preferred carriers •Highly rated carriers $ • • • • ________ ________ ________ ________ ¬¬ ¬¬ ¬¬ ¬¬ Define price discrimination structure • • • • ________ ________ ________ ________ ¬¬ ¬¬ ¬¬ ¬¬ Receive notification of shipper's request for service Negotiate and close transaction on-line NETLogistiK Complete paperwork on-line FORMS FORMS Complete paperwork on-line Settle on-line $ •Electronic scheduling •Intelligent search capabilities •Neutral one-stop-shop •Capacity. availability and pricing •Data.

5-3.5-3.Emerald Internet Ventures PRODUCT OFFERING Description Revenue Source 2. The users will be able to optimize their fleets and leverage their sales force 2. Coca Cola. etc) 2. This product can contribute substantially to revenues as insurance premiums are usually 1% of the cargo value and standard commissions for insurance brokers are 10-15% Offered through a referral network of experts that will have alliances with NETLogistiK.5-3.5% of transaction value Offer the possibility of buying cargo insurance online. Intra-carrier exchange 4. Warehousing and cargo management TD B Offered through a network that will operate similarly to the one for Customs and tax services. Cargo Insurance Real-time marketplace for spot contracts between a pre-selected network of carriers. Customs & tax advisory services 7.5% of transaction value Longer term and/or special contracts that require price and conditions negotiation tools.g.5% of transaction value 3. Xerox.Confidential .5% of transaction value 1. 15% of referral value 18 . Giving Allow carriers to auction their excess capacity in order to optimize truck utilization (return trips) 2. The company will charge a flat fee for each referral to its partners 15% of Insurance premium 6. Specially targeted to large shippers (e. Spot contracts marketplace 2. Multiple or complex shipments negotiation tools 5. s schedules and availability information. Excess capacity auctions One time contract for specific transportation needs. Shippers post their requirements and NETLogistiK will electronically channel the RFQ to selected carriers and/or match their requests with carrierÕ rates.5-3.

Emerald Internet Ventures CONTENT Executive Summary 1.Confidential . Industry overview • • • • Business concept NETLogistiK product offering Competitive landscape Financials Appendix 19 .

Confidential .Emerald Internet Ventures COMPETITIVE LANDSCAPE – INTERNET PLAYERS U.S. market is becoming highly competitive.S. Europe Latin America Multimodal NETLogistiK Truck • The U. there is no dominant player yet • Europe is emerging • Latin America is still largely untapped Air/Ocean 20 .

and still in a very early development stage • No player has taken a dominant position in the market yet • Despite its attractiveness. High transaction capabilities ** Air *** Future Development Source: WebPages. it is behind the U. Limited amount of value added services. NETLogistiK team analysis 21 .Emerald Internet Ventures COMPETITIVE LANDSCAPE USA Manugistics FreightGate From 2 C l rx eai Trade Matrix FreightGate EUROPE LSXS NETLogistiK*** LATIN AMERICA Multimodal Truck FreeCargo Truckstop Transplace OpenShip BidFreight CarrierPoint NTE EuroTrans FreeCargo BidFreight NETLogistiK Ocean or ri A Freightonline CargoNet PriceContainer Oceanwide CargoWerks ** Ctransport GoCargo eraterequest GF-X** Low High Level of Development (*) Low High Level of Development (*) Low High Level of Development (*) • Although the competitive landscape is very populated.Value added services. NTE andGo Cargo. deep exchange . there are not many players that provide full service and end-to-end transaction solution • We believe that the industry leaders at this point are: Celarix. Searchable bulletin boards. in their respective segments • The European market has seen some sites coming to the market • However.Confidential . High Level of Development: Dynamic. the Latin American market is not competitive yet • The opportunity is open to the first player that can offer a robust solution * Low level of Development: Info Aggregators. CarrierPoint.S.

com etransport.com Manugistics. has payment processing and on-line insurance Focused on carriers. arrangement all made outside the exchange Focused on transactional issues.com Oceanwide. Not Cargo A web-based supermarket for the transportation industry created by incumbents A pure auction service for container shipping space Carriers bid on shippers postings. software solutions for industrial transportation industry RFQ service.com Freight-on-line. offers some tracking capabilities A pure auction service for truck space. for truckers. freight posted has a minimum price.com NE T OpenShip.com Pricecontainer.com BidFreight.com Eraterequest. robust tracking and payment processing services A pure auction service for truck space. only ocean containers Offers information services. schedules.com Freightgate. and some useful tools A robust dynamic matching and pricing marketplace. includes more than one mode. Not an exchange.com Tradematrix. quotes. not many other services A website that focus on providing services for small package/parcel shipments in Latin America. Proprietary tax and customs calculators Basically a searchable database. provides logistics and supply chain mgmt.com Eurotrans.Confidential . applications Shipping solutions for online purchasing. plus other logistic management software tools Part of a family of other web-enabled B2B services. for air carriers and forwarders Focus U S U S U S U S ER U E/ U U R S U S U S U S E/ U U R S E/ U U R S U S ER U LAT U S U S U S ER U U S U S U S U S U S E/ U U R S Range of services Transaction capability Service focus Multimodal Multimodal Multimodal Multimodal Multimodal Multimodal Truck Truck Truck Truck Truck Truck Truck Truck Truck Ocean Ocean Ocean Ocean Ocean Ocean Ocean Air Air * Note: This page contains information that may become outdated shortly due to the speed at which these companies are evolving. sourcing.com Cargowerks. procurement.com Global Freight Exchange Comment A more robust service. facilitates document exchange Exchange and tools for negotiating contracts and checking rates.com Transplace.Emerald Internet Ventures Low Medium High COMPETITIVE LANDSCAPE – SUMMARY TABLE* Current Player Celarix. with customizable pages and automatic messaging Tracking. news.com Truckstop.com FreeCargo. offers some tracking capabilities Searchable database for available equipment and loads A load and truck availability posting service Searchable database by routes. limited to ocean shipping On-line quotation system Marine towing industry.com GoCargo.com CarrierPoint. Source: WebPages. a database to advertise shipping needs and space/equipment availability Acts as intermediary.com Cargonet. etc.com NetEnvios.com from 2 lsxs. NETLogistiK team analysis 22 .

Industry overview • • • • Business concept NETLogistiK product offering Competitive landscape Financials Appendix 23 .Emerald Internet Ventures CONTENT Executive Summary 1.Confidential .

Rev: TBD ARGENTINA •GDP*: $287bn •GDP Per capita $7947 •Transport. Team Analysis 24 . Rev: TBD COLOMBIA •GDP*: $92bn •GDP Per capita $2438 •Transport. Rev: TBD BRAZIL •GDP*: $509bn** •GDP Per capita $3105 Transport. Rev: $18-20bn CHILE •GDP*: $69bn •GDP Per capita $4587 •Transport. $10-11 bn * 1999 US$ Nominal GDP ** Brazil 1999 GDP value in US$ is smaller than the 1997 figures due to the recent currency devaluation Source: Goldman Sachs. Rev: $14-19bn VENEZUELA •GDP*: $104bn •GDP Per capita $4394 •Transport.Emerald Internet Ventures KEY STATISTICS Latin America MEXICO •GDP*: $475bn •GDP Per capita $4826 •Transport.Confidential . Rev.

ocean. •These additional revenue sources could come from: _Vertical market for truck-related products _Partnerships with automotive/truck producers to provide fleet renovation plans _Purchasing aggregation services for small carriers to buy products such as combustible and lubricants _Extension of services to a multimodal solution (rail.Confidential . air) 250 150 Low-end Scenario Penetration 3% Base Case Upper-end Scenario Penetration 8% Penetration 5% Source: NETLogistik Team Analysis 25 .Emerald Internet Ventures PRELIMINARY ESTIMATES SHOW THAT NETLOGISTIK HAS A HIGH REVENUE POTENTIAL PRELIMINARY Revenue Potential $ Millions 400 •Preliminary estimates show that NETLogistiK could generate between $150-$400 million in revenue after 3 years of operations (see details in following pages) •These revenue numbers do not include other potential revenue sources (option value) that could become available once NETLogistiK captures a significant number of players on its network (Net effect).

000 No.000 1. Insurance premium ($140) = Value of cargo ($14.0% <-.000 3.000 151 177 202 228 253 5. of Transactions per year Total Revenue ($ Millions) 253 # of transactions insured on-line Revenue from 2.Emerald Internet Ventures POTENTIAL REVENUE TREE.600.Penetration 128.0% 96. (for detail on how revenues drivers are expected to evolve over time see financial statements pages) * Revenue generated by the carrier per truck.000 350.000 113 132 152 171 190 4. Consistent with range obtained during interviews with carriers ($65. Interviews.200 # trucks in the market # of trucks captured by NETLogistiK's system 80. others Value of Transactions per truck ($)* 45.600.ALL COUNTRIES $ Millions Amount charged per trip by the carrier ($) Value of transactions per truck.000 T A S O T T N D SR D T R N P RAI I U T Y AA ON Country Brazil Mexico Argentina Other Total # trucks by market 700.000 75.000 65.000 189 221 253 285 317 6. 26 .400.000.Confidential .000 200 325 This bottom-up model illustrates the revenue potential after 3-4 years of operations.0% 64.000 # of Trips per year 200 % insured online 15% 1.000)*Insurance rate (1%) *** We assumed that after 3-4 years NETLogistiK is able to capture 200 of the 250 trips that a truck makes per year Source: Economy Ministry.000 302 353 404 456 507 16.0% 48. NETLogistiK Team Analysis.000) ** Assuming that referral fee is 10% of the insurance premium.000-100.000 insurance referral ($Millions) 34 Referral fee $ per transaction** 14 TOTAL REVENUE SENSITIVITY MATRIX $ Millions # of trucks captured by NETLogistiK's system 253 Other Revenues ($Millions) 63 25% of Total Revenue Warehousing services Custom Services Infrastructure services.000 85.0% 80.000 250.year ($) * 65.000 Penetration 5% # of trucks captured by NETLogistiK's system 80.000 55.000 300.000 # Trips per year*** Value of transactions Processed ($Millions) Revenue from commissions ($Millions) 156 Commissions % 3% 5.000 227 265 303 342 380 8.

0 1 4 7 7 . 7 2 3 .E C R CS AT RD X O M I 3 5 5 .Emerald Internet Ventures ESTIMATE R V N EA G N I A E E U . 0 0 0 2 0 2 . T U K C PU E . 2 0 0 2 3 0 0 2 4 0 0 2 0 0 0 2 0 0 5 2 1 0 0 2 0 0 5 2 0 0 5 7 2 0 0 2 3 0 0 2 4 0 0 2 27 . No. 1 0 0 2 4 2 3 . 1 0 0 2 2 0 0 2 3 0 0 2 4 0 0 2 0 5 3 0 0 0 2 1 0 0 2 2 0 0 2 3 0 0 2 0 0 5 3 02 51 2 07 01 5 4 0 0 2 R V N EO H R EEU.T E R CS AT RD HR O 02 01 5 5 3 9 .BY REGION $ Millions. 0 0 0 2 2 1 0 . 2 3 3 . 7 3 8 . 0 7 2 0 0 2 3 0 0 2 4 0 0 2 0 0 0 2 0 0 0 7 1 0 0 2 2 0 0 2 3 0 0 2 4 0 0 2 4 9 . 1 0 0 2 0 1 0 . 5 2 0 1 . 1 0 0 2 4 2 .R E TN T U KCPU ER CSAT RD A G NI A R E TN 4 7 . 0 0 0 6 0 0 . 0 0 0 7 7 1 1 .TE T U K C PU E . 0 0 0 2 2 6 . 0 0 . of Trucks Confidential . 1 0 0 2 2 0 0 2 3 0 0 2 4 0 0 2 R V N EM XC EEU. 3 7 1 0 0 0 2 5 2 .EI0 T U K C PU E . 0 0 0 2 2 2 . 0 0 .R Z R C S A T R DB A I L 05 03 0 04 02 5 04 01 0 Total Revenues 8 . 0 3 2 0 0 2 3 0 0 2 4 0 0 2 0 0 0 2 1 0 0 2 2 0 0 2 3 0 0 2 0 0 0 3 00 01 5 05 01 0 4 0 0 2 REVENUE-BRAZIL 6 .PRELIMINARY REVENUE FORECAST. 0 1 . 0 .

000 250.500 24.5% 3.500 80.000 3.0% 2.0% 5 5% 14 5% 10% 14 10% 15% 14 15% 15% 14 25% 15% 14 25% 300 700 350 1.000 250.000 300.000 250.000 35.500 120 325 3% 10.1% 0.Confidential .000 2001 2002 2003 2004 •This page shows a conservative scenario where the maximum penetration is 5%.0% 5.000 1.000 2.0% 1.000 1.000 300.5% 3.500 12.500 54.0% 0.000 350.0% 5 50. Percentages OPERATING RATIOS & FORECAST ASSUMPTIONS 2000 Transaction Revenue Assumptions No of trucks in the market ( assumed fix for simplicity at this point of the analysis) Argentina Brazil Mexico Others Total Penetration Argentina Brazil Mexico Others No of trucks captured by NETlogistiK's system Argentina Brazil Mexico Others Total No of transactions per year per truck Average value of a transaction ($) Commission % charged by NETlogistiK Insurance Revenue Assumptions %transactions processed that are insured online Insurance referral fee ($) Other Revenue Assumptions Other revenues (*) as % of total revenues Other Operating Assumptions Operating Costs (w/o depreciation) Depreciation Other Assumptions FCF perpetuity growth % 6% % Rev.000 1.000 1.600.500 12.0% 1. and the number of transactions per truck per year.350 10 325 3% 3.1% 2. CommerceOne.000 7.000 700.000 300.0% 2.0% 5 90.000 700.000 7.000 350.750 200 325 3% 15. etc) 28 .000 700.500 29.000 300.600.0% 5.0% 5 60.0% 5.500 250 13.000 700. 5 -150.000 350.0% 1.000 1.a. do not reach their maximum until year 2003 •For illustrative purposes we assumed that over time (after major customer acquisition expenses flattens) operating margins increase until they reach a 50% level.000 200 325 3% 0.1% 1.5% 3.000 17.250 7. Similar to that forecasted by analyst for other virtual marketplaces (Ebay.0% 3.600.0% 300.750 60 325 3% 6.600.000 14.0% 5.000 350.000 250.000 250.000 700.Emerald Internet Ventures FINANCIAL STATEMENTS Units.1% 0. Years n.600.000 350.

Resulting in high operating margins similar to that of other virtual marketplaces.Emerald Internet Ventures NETLOGISTIK EXPECTS TO HAVE HIGH LONG-TERM OPERATING MARGINS SIMILAR TO THOSE OF OTHER VIRTUAL MARKETPLACES Percent 40%-50% 35%-45% 45%-50% NETLogistiK web-enabled intermediary model will benefit from low capital intensity and high operational leverage. Ebay* CommerceOne** I2 Technologies *Projected operating margins for stable stage (where customer acquisition cost flattens) ** Based on analyst reports (Morgan Stanley Dean Witter.Confidential .BancBoston) *** Operating margins excluding software margins Source: Analyst reports 29 .

753 5.500 252.9% 2.535 31.764 630 7.515 1.403 10.704 (23.500) 67.763 4.946 3.227 -36 444 1.331) (100) (5.400 110. •These additional revenue sources could come from: _ Vertical market for truck-related products _ Partnerships with automotive/truck producers to provide fleet renovation plans _ Purchasing aggregation services for small carriers to buy products such as combustible and lubricants _ Extension of services to a multimodal solution (rail.528 1.900 2001 2002 2003 2004 TV •This page illustrates a scenario where the $250 million potential is captured by 2004 •These revenue numbers do not include other potential revenue sources (option value) that could become available once NETLogistiK captures a significant number of players on its network (Net effect).757 627 7.600 55.506 3.711 4.900 (43.125 24.650 13.000 29 68 34 0 132 2 5 2 0 9 2 4 2 0 7 33 77 39 0 149 (1.925 43.925 34.666) 1.210) -51. ocean.022 2.000 6.454 81.565 4.375 156.380 8.182 49.755 4.355 9.210) 7.700 7.190 2.Confidential .500) 123.300 14.290 5.625 106.044 252 588 294 21 1.1% 0 -500 (5.0% 100 -3.600 11.410 10.203 2.502 717.250 68.652) 1.888 14.192 717.696) 44.295 19.800) 0 (1.700 173.250 34.230 5.475 47.008 25.150 22.875 63.710 23.513 1.512 3.365) 80.000 123.Emerald Internet Ventures FINANCIAL STATEMENTS (CONT) $ Thousands FINANCIAL STATEMENT FORECAST 2000 Revenue from transactions commissions($ 000's) Argentina Brazil Mexico Others Total Revenue from insurance referal Argentina Brazil Mexico Others Total Other Revenues Argentina Brazil Mexico Others Total Total Revenues Argentina Brazil Mexico Others Total Revenues Operating Costs (w/o depreciation) Depreciation Operating profit Interest expense Other income/expense Income Before Taxes Taxes Net Income % of Sales Add back: Depreciation Capital Expenditures Add back: Interests * (1-tax) Change in WC Terminal value Free Cash Flow (2.704 29.018 45.500 -5.300 39.434 1.253 33.180 77.200 47.652) -1112.350 5.800 (126.995 8.421 11.850 27. air) 30 .235 20.000 67.602 186 10.250 33.420 38.010 (103.038 23.020 16.000 4.652) 0 (1.6% 700 -4.221 (15.095 2.048 146 8.775 23.187) (7.502 (1.352 (44.400) (2.482) 2.678 5.825 9.155 223 520 260 19 1.4% 1.145 3.210) 0 (5.806) (1.235 (1.417) (700) 4.500 -5.

Confidential . Industry overview • • • • • Business concept NETLogistiK product offering Business development Competitive landscape Financials Appendix 31 .Emerald Internet Ventures CONTENT Executive Summary 1.

MEXICO • The Mexican commercial transportation industry amounted to US$13-14 billion in 19981. • Truck transport dominates the movement of goods.500 trucks participating in the exchange. The capacity of the Mexican market is composed of 330.000 are distributed among the close to 6. • The top 50 carrier firms in Mexico amass a capacity of over 12. 1/ Source: Instituto Mexicano del Transporte 2/ Source: Transportation Technical Services. • Purchasing of local logistic and transportation is very inefficient.7% of the total. most medium to large firms deal with many carriers. CH Robinson. around 40. Of all modes of transport. Large logistics intermediaries (e. 32 .Emerald Internet Ventures TARGET MARKET.000 are owner-operated trucks and 290. as shippers have to contact carriers individually. representing only 3.000 registered firms2.Confidential . 15-30 for the largest firms3. • NetLogistiK estimates that in the Mexican market alone it can attain a capacity of close to 17. usually by phone.000 trucks. • The market was deregulated in the early 90’s and remains highly fragmented. These are firms with at least 120 units each and an average of 250 units for the group. SCT 3/ Source: McKinsey & Co.g. trucks captured over 80% of the value generated by the sector. Of these. This implies getting 10-15 of the top 50 carrier firms to participate and 300 medium sized firms out of the universe of 6. Danzas) have limited penetration and have focused on international movement of goods and not local distribution.000 trucks. • Because of this fragmentation.000 that exist today.

0% 21.000 3.0% 17. Insurance premium ($140) = Value of cargo ($14.Penetration 28. of Transactions per year Total Revenue ($ Millions) 55 Revenue from insurance referral ($Millions) 7 Referral fee $ per transaction** 14 TOTAL REVENUE SENSITIVITY MATRIX $ Millions # of trucks captured by NETLogistiK's system 55 Other Revenues ($Millions) 14 25% of Total Revenue Warehousing services Custom Services Infrastructure services. others Value of Transactions per truck ($)* 45. Interviews.000 85.500 25 29 33 37 42 4.000 200 325 This bottom-up model illustrates the revenue potential after 3-4 years of operations.000 50 58 66 75 83 8.MEXICO $ Millions Amount charged per trip by the carrier ($) Value of transactions per truck.500 41 48 55 62 69 6.0% 10.000 # of Trips per year 200 350. NETLogistiK Team Analysis. Consistent with range obtained during interviews with carriers ($65.138 # trucks in the market # of trucks captured by NETLogistiK's system 17.0% 14.000 55. 33 .000 33 39 44 50 55 5.0% <-.000 # Trips per year*** Value of transactions Processed ($Millions) Revenue from commissions ($Millions) 34 Commissions % 3% 1.500 No.000 66 77 88 100 111 # of transactions insured on-line 525.000 75.000 65.000-100.000)*Insurance rate (1%) *** We assumed that after 3-4 years NETLogistiK is able to capture 200 of the 250 trips that a truck makes per year Source: Economy Ministry.year ($) * 65.500.000) ** Assuming that referral fee is 10% of the insurance premium. (for detail on how revenues drivers are expected to evolve over time see financial statements pages) * Revenue generated by the carrier per truck.500 Penetration 5% # of trucks captured by NETLogistiK's system 17.Emerald Internet Ventures POTENTIAL REVENUE TREE .Confidential .000 % insured online 15% 3.

Confidential .Emerald Internet Ventures LARGEST CARRIERS.g.MEXICO Capacity 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 Carrier Transportadora Nacional Transportes Julian de Obregon Auto Lineas Regiomontanas Transportes Castores de Baja California Transportes Cuahutemoc MYM Autotransportes de Carga Tres Guerras Transportistas Unidos Mexicanos Autolineas Mexicanas Compania Fletera del Caribe Fletes Mexico Chihuahua Express Tres Fronteras Trans. Esp. Antonio de la Torre e Hijos Express Sinaloa Division Ensenada Transportes de Nuevo Laredo Bravo Logistics Transportes COR Autolineas America Express Anahuac Nafta Express Transportadora Hercel Transportadora Egoba Cia de Transportes de Mar de Cortes Fletes Sotelo Transportes Aguila de Cd Juarez Auto Express Perla Transportes Quintanilla Servicio de Transportes Jaguar Comercial Intern de Transportes y Carga Express Santa Fe Fletes Maya del Sureste Jose Antonio de Luna Diaz de Leon Transportes Sotres Autotransportes de Carga Fremo Transervicios Central de Fletes Monterrey Transportes Monterrey Transportes Pitic Ryder Capital Transportes Gonzalez Integradora de Transportes Golfo Istmo Transportes Unidos Tampiquenos Fletes Pegaso Transportes del Golfo y Noreste Auto Express Mercurio Servi Transporte Viga Aguilas de Occidente Transportes Mon-Ro Transportes El Ola Auto Fletes Regionales Tractors 530 250 450 450 450 0 400 348 156 250 300 285 290 130 275 267 176 250 250 250 250 240 205 200 175 204 200 200 200 200 100 100 80 80 186 192 130 160 150 150 150 150 150 133 132 130 100 125 125 120 Trucks 270 300 30 15 0 450 20 69 200 75 20 6 0 148 0 0 80 0 0 0 0 0 8 12 36 0 0 0 0 0 100 100 120 120 10 0 60 22 20 15 0 0 0 0 0 0 30 0 0 0 Tractors+Trucks 800 550 480 465 450 450 420 417 356 325 320 291 290 278 275 267 256 250 250 250 250 240 213 212 211 204 200 200 200 200 200 200 200 200 196 192 190 182 170 165 150 150 150 133 132 130 130 125 125 120 Trailers 530 250 550 450 550 0 400 420 240 150 600 545 396 200 549 500 445 800 450 300 200 320 0 1. etc) as an incentive to bring large carriers •Use non-cash incentives such as advertising • Medium size-carrier firms are expected to be attracted through participating shippers (i. 34 . sorting priority) •Offer stock options for early enrolment (as UOL did) •Offer option to purchase stock in first round of financing •Capture large shippers (e.g. shippers will promote the use of NetLogistiK with their traditional carrier firms).e. CocaCola.200 120 296 514 400 200 200 100 100 100 80 450 345 80 315 300 380 150 150 141 178 157 175 100 450 170 150 •NetLogistiK will initially target larger carrier firms to provide the exchange with greater liquidity •To acquire some of these initial “key” carriers NetLogistiK will: • Offer preferential treatment (e. Xerox.