International Briquettes Holding ("IBH"), a Cayman Islands company, was formed on October 14, 1997 and for accounting purposes is the successor to Old IBH ("Old IBH"). On October 15, 1997, IBH acquired all the assets and assumed all of the liabilities of Old IBH, a Cayman Islands company, which for accounting purposes was the successor to Fior de Venezuela, S.A. ("Fior"). Fior is a 60% owned Venezuelan subsidiary of Siderúrgica Venezolana "Sivensa", S.A.C.A. and operated within the IBH Division which comprises Sivensa's high density iron briquettes ("HBI") production facilities; CVG Ferrominera del Orinoco, C.A. owns the remaining 40% (see Note 4). During 1997 Fior, as part of a series of reorganization transactions, transferred substantially all of its assets, liabilities and contracts to Old IBH in exchange for all the outstanding shares of Old IBH and a US$20 million note from Old IBH (see Note 4). First, in May 1997 Fior contributed to its Venezuelan wholly-owned subsidiary, Operaciones RDI, C.A. ("RDI") substantially all of the assets and contracts related to Fior's HBI facility located in Ciudad Guayana, Venezuela (the "Fior Plant", which has a rated annual capacity of 400,000 tons), and RDI assumed substantially all the liabilities related to the Fior Plant. Fior then contributed all of the outstanding shares of RDI to Old IBH in exchange for new shares of Old IBH and a US$20 million note from Old IBH. Second, in May 1997 Fior and its subsidiaries also participated in a series of transactions which resulted in the transfer of all the outstanding shares of Brifer International Ltd. ("Brifer"), a Barbados wholly-owned subsidiary of Fior, to Old IBH in exchange for additional new shares of Old IBH. Also, as a consequence of that series of transactions, Brifer owns all of the patents, intellectual property and rights related to the Fior Plant (the "Improved Fior process"). Third, in August 1997 Fior caused the transfer of all the assets and contracts related to the construction of a 2.2 million tons per year HBI facility (the "Orinoco Iron Plant") to Orinoco Iron, C.A. ("Orinoco Iron"), a Venezuelan wholly-owned subsidiary of Old IBH (see Note 7). In October 1997 IBH acquired all the assets and assumed all the liabilities of Old IBH. Immediately, following these transactions IBH acquired all of the outstanding shares of Old IBH. All these transactions were considered to be a reorganization of Fior and, therefore, the assets transferred and liabilities assumed were all recorded by IBH at Fior´s historical book value (the predecessor cost basis). Additionally, on November 19, 1997, IBH (wholly owned subsidiary of Fior at that date) completed an exchange offer to exchange one ordinary share of IBH for each three outstanding Global Depositary Shares (GDS) of Venezolana de Prerreducidos Caroní "Venprecar", C.A. (subsidiary 71.9% owned by Sivensa at this date) (see Note 8). Upon completion of the exchange, Venprecar became a subsidiary 98.4% owned by IBH. Venprecar is incorporated in Venezuela, manufactures HBI and operates within the IBH Division of Sivensa. Venprecar´s only plant, located in Ciudad Guayana, Venezuela, has a rated annual capacity of 815,000 tons. Venprecar follows the same accounting practices and has the same year-end as IBH.