Benefits of Making Business in Jordan | Buy & Sell Business

1. BENEFITS OF MAKING BUSINESS IN JORDAN WWW.MERGERSCORP.COM

2. At MergersCorp M&A International we help our clients confidentially buy and sell privately held businesses, aligning the interests of all parties for mutual success and satisfaction. It is our goal to make the process of either buying a new business or selling your current business as smooth and efficient as possible. We know how important confidentiality is to our sellers and we treat it with the utmost importance. WWW.MERGERSCORP.COM

3. BENEFITS OF MAKING BUSINESS IN JORDAN WWW.MERGERSCORP.COM

4. Country Overview Jordan, an Arab nation on the east bank of the Jordan River, is defined by ancient monuments, nature reserves and seaside resorts. It’s home to the famed archaeological site of Petra, the Nabatean capital dating to around 300 B.C. Set in a narrow valley with tombs, temples and monuments carved into the surrounding pink sandstone cliffs, Petra earns its nickname, the "Rose City.“ Jordan, a constitutional monarchy on the East Bank of the River Jordan in Western Asia, gained its independence in 1946. It is divided into 12 governorates, with Amman as the capital. The official language of Jordan is Arabic, and the currency is the Jordanian dinar (JOD).

5. Executive Summary Slightly smaller in area than the country of Portugal, Jordan is bounded to the north by Syria, to the east by Iraq, to the southeast and south by Saudi Arabia, and to the west by Israel and the West Bank. The Hashemite Kingdom of Jordan is a small country with few natural resources, but it has played a pivotal role in the struggle for power in the Middle East. Jordan's significance results partly from its strategic location at the crossroads of what Christians, Jews and Muslims call the Holy Land. Tourism is of vital importance to the national economy of Jordan. It's the Kingdom’s largest export sector, second largest private sector employer, and second highest producer of foreign exchange.

6. Introduction – Doing business in Jordan In the World Bank’s Ease of Doing Business Survey for 2019, Jordan ranked 104th out of the 190 countries surveyed. The most notably troublesome area is resolving insolvency, for which the country ranked 150th. The Jordanian economy is market oriented economy. The economic system is based on free enterprise and personal initiative. Expats looking to do business in Jordan will likely find opportunities in the country’s growing economy. The Information Communications and Technology (ICT) sector is the fastest growing sector in Jordan's economy. There are 500 companies operating in telecom, IT, online and mobile content, business outsourcing, and games development.

7. Conducting business in Jordan There are two types of Jordanian Entity that can be set up in Jordan: •Private Shareholding Companies (‘PSC’) and •Limited Liability companies (‘LLC’). The only distinction between the two entities is the capital requirement. A PSC can be formed with a minimum share capital of Fifty Thousand (50,000) Jordanian Dinars whereas an LLC requires to have a share capital of at least One (1) Jordanian Dinars

8. Taxation in Jordan Resident companies are taxable on income sourced in Jordan. Taxable income – Income derived from Jordanian sources is taxable. The rate is 15% for 2019 (10% for pharmaceutical and clothing manufacturing companies) and increases annually until it reaches 20% (the standard rate) in 2024. The Personal Income Tax Rate in Jordan stands at 20 percent. VAT is applied to many goods except for those that are considered basic necessities such as foodstuffs and some utilities. The standard VAT rate is 16% although a higher rate may be applied to some luxury items. Many imported items have VAT applied to them or a sales tax, which can make the prices of some items seem high.

9. Trade Jordan is the 91st largest export economy in the world and the 65th most complex economy according to the Economic Complexity Index (ECI). In 2017, Jordan exported $8.17B and imported $20.7B, resulting in a negative trade balance of $12.6B. In 2017 the GDP of Jordan was $40.1B and its GDP per capita was $9.2k. The top exports of Jordan are Calcium Phosphates ($672M), Knit Sweaters ($524M), Other Knit Garments ($490M), Packaged Medicaments ($409M) and Potassic Fertilizers ($402M), using the 1992 revision of the HS (Harmonized System) classification. Its top imports are Cars ($1.69B), Petroleum Gas ($1.11B), Refined Petroleum ($1.06B), Crude Petroleum ($1.01B) and Packaged Medicaments ($453M).

10. Banking in Jordan Jordan's banking sector is the strongest segment of its financial services industry, with a history of dating back to 1948, when Arab Bank moved its headquarters from Jerusalem to Amman. Banking accounted for 18.82% of GDP as of mid-2015, making it one of the largest economic sectors in the kingdom. The Central Bank of Jordan is an independent autonomous corporate body that maintains the safety of the banks in Jordan, issues and regulates banknotes and coins, and maintains and manages the Kingdom’s gold reserves and foreign exchange. Bank of Jordan is a commercial bank that was founded in 1960 and one the largest banks in Jordan. The bank provides consumer and corporate banking, leasing, SME, and investment banking solutions.

11. Our M&A Process NEGOTIATION & CLOSE POST MERGER INTEGRATION (PMI) INTEGRATION (PMI) POST MERGER TARGET APPRAISAL APPROACH DUE DILIGENCE Key Areas  Target & market analysis;  Initial assessment of synergies & value drivers;  Indicative valuation;  Go or No-Go decision;  Preparation of transaction documents (NDA – Non- disclosure Agreement/LOI- Letter of Intent);  Select Transaction team;  Appoint advisors;  Consider funding ability.  Initial approach letter;  Signing of NDA;  Prepare & share initial information requests;  Formulation of LOI (Letter of Intent) & possible negotiations;  Initial meeting and Q&A;  Circulate information on the Target to the Transaction team.  Set scope of due diligence;  Set up VDR (virtual data room);  Coordinating of due diligence, further meetings and Q&A sessions;  Consider points relevant to the Post-Merger (PMI) phase;  Revisit indicative valuation & prepare detailed valuation based on due diligence findings;  SPA negotiations with the seller;  Development of final structure (share/asset deal) and final valuation;  Approvals;  Signing of SPA & Close.  Consider the extent of integration;  Development of 100 Day PMI Plan;  Consider short & long term objectives;  Estimate requirements to capture synergies;  Determine resource needs & optimal allocation. Parties Involved  CFO;  Head of M&A;  Accountants;  Corporate finance advisors;  Consultants.  Senior management;  CEO, CFO, CTO;  Strategy director;  Head of M&A;  Head of Business Development;  Consultants.  Company general counsel;  Lawyers;  Senior management.  Company general counsel;  Lawyers;  Senior management/HR. 11 © Midaxo 2018 www.midaxo.com

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13. MergersCorp.com The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. Member firms of the MergersCorp network of independent firms are affiliated with MergersCorp International. MergersCorp International provides no client services. No member firm has any authority to obligate or bind MergersCorp International or any other member firm vis-à-vis third parties, nor does MergersCorp International have any such authority to obligate or bind any member firm. Copyright © 2020 MergersCorp International. All rights reserved. 13 © Midaxo 2018 www.midaxo.com