USE OF PROCEEDS RISK FACTORS

xx Description Prior to the Initial Public Offering Subsequent to the Initial Public Offering and ESA Program Implementation Number of Shares Total Nominal Value Rp Number of Shares Total Nominal Value Rp Shares in Portfolio 15,000,000,000 1,500,000,000,000 13,750,000,000 1,375,000,000,000 Management and Employee Stock Option Program MESOP The stock options granted to participants of the MESOP the Stock Options may be exercised to purchase up to 187,500,000 shares of the Company, representing up to 3.0 of the Company’s total issued and paid-in capital following the completion of the Initial Public Offering, which shall be issued from the Company’s portfolio. MESOP Exercise Periods The Stock Options under the MESOP shall be issued in three phases, namely: Phase I 30.0 of the total Stock Options to be issued under the MESOP shall be issued by no later than 60 days subsequent to the the Listing Date. Phase II 30.0 of the total Stock Options to be issued under the MESOP shall be issued on the first anniversary of the Listing Date. Phase III 40.0 of the total Stock Options to be issued under the MESOP shall be issued on the second anniversary of the Listing Date. Stock Options shall be issued with an Option Life of five years commencing on the issue date, and shall be subject to a vesting period of one year commencing on the issue date. Upon the subscription of all of the Offering Shares, and when the Award Shares are fully awarded and all the Stock Options available under the MESOP are granted and exercised, the Company’s capital structure and shareholder composition prior to and immediately following the Initial Public Offering on a pro forma basis shall be as follows: Share capital consisting of ordinary registered shares with a nominal value of Rp100 per share Description Prior to the Initial Public Offering Subsequent to the Initial Public Offering, ESA Program Implementation and MESOP Implementation Number of Shares Total Nominal Value Rp Number of Shares Total Nominal Value Rp Authorized Capital 20,000,000,000 2,000,000,000,000 20,000,000,000 2,000,000,000,000 Issued and Fully paid-in capital - PT Integra Indo Lestari 4,956,950,000 495,695,000,000 99.14 4,956,950,000 495,695,000,000 77.00 - PT Sinergi Mentari Alam 43,050,000 4,305,000,000 0.86 43,050,000 4,305,000,000 0.67 - Public - - - 1,243,750,000 124,375,000,000 19.32 - ESA Program - - - 6,250,000 625,000,000 0.10 - MESOP 187,500,000 18,750,000,000 2.91 Total Issued and Fully paid-in capital 5,000,000,000 500,000,000,000 100.00 6,437,500,000 643,750,000,000 100.00 Shares in Portfolio 15,000,000,000 1,500,000,000,000 13,562,500,000 1,356,250,000,000 Further information in relation to the ESA program and MESOP is presented in Chapter I of this Prospectus.

5. USE OF PROCEEDS

xxi Proceeds from the Initial Public Offering, after deducting the aggregate estimated expenses incurred in relation to the Initial Public Offering, shall be used for the following purposes: • Approximately 90.0 of the net proceeds from the Initial Public Offering shall be used by the Group to finance capital expenditures, namely: the procurement of machinery and equipments, the acquisition of land and the opening of retail outlets.; • The remaining shall be used by the Group as working capital, for, among others, financing the procurement of raw materials and payment of, among others, trade payables, production costs and, marketing expenses. Further information in relation to the Use of Proceeds is presented in Chapter II of this Prospectus.

6. RISK FACTORS

The business and general risks presented below have been prepared based on the order of significance of the impact of each risks to the Company, from the most significant to the least significant: A. MAIN RISK WITH SIGNIFICANT IMPACT TO THE COMPANY’S BUSINESS SUSTAINABILITY 1. Risk relating to laws and regulations B. BUSINESS RISKS 1. Risk relating to foreign exchange fluctuations for the Company; 2. Risk relating to the supply of raw materials 3. Risk relating to fire at production facilities 4. Risk relating to the increase in the regional minimum wage levels 5. Risk relating to dependence on major customers 6. Risk relating to business competition 7. Risk relating to technological advancement C. GENERAL RISKS 1. Risk relating to macroeconomic and global economic condition 2. Risk relating to the benchmark interest rate for loans 3. Risk relating to claims or legal suits D. RISK FACTORS FOR INVESTORS 1. Risk relating to the fluctuation of the Company’s share price 2. Risk relating to foreign exchange rate fluctuations for foreign investors 3. Risk relating to the Company’s shares liquidity 4. Risk relating to the Company ability to pay dividends 5. Risk relating to minority share ownership Further information in relation to Risk Factors is presented in Chapter VI of this Prospectus.

7. KEY FINANCIAL HIGHLIGHTS