CAPPA Calls for Transparency, Rule of Law in Transpetrol Case

WASHINGTON, May 27, 2010 - During a press conference at the National Press Club Wednesday Mr. Steve
Richards, Managing Director of CAPPA Fund III, called for the Government of
Slovakia to be transparent and observe the rule of law regarding pipeline
operator Transpetrol. "We have a direct request: respect the rule of law and
the legitimacy of the Slovak courts. Show the people of Slovakia the
revenues, the expenses, what happened in secret shareholder meetings, and
where the profits went."

Richards called the decade-long legal battle in the civil and criminal
courts an attempt to divert attention from how the asset has been managed.
"Transpetrol should have delivered great value to the people of Slovakia, but
it has not. We believe it has been mismanaged."

Proper corporate governance, said Richards, could make Transpetrol a
platform for future growth. "If the Government allows efficient management of
this asset, it will usher in a more predictable business and investment
environment, with increased transparency and integrity. This would bring more
[foreign] investment, create new jobs, and increase the national wealth of
Slovakia. These are things the private sector does well. The Government
should not look at CAPPA as a threat, but as a partner that can help manage
this asset for the greater benefit of all shareholders, which, by virtue of
the 66% held by the government, include the citizens of Slovakia."

Richards defended his firm's legal claim to the disputed shares. "We are
convinced by our due diligence that these 647 shares were sold in a clearly
legal manner, in a proceeding that has been upheld by the judicial system of
the Slovak Republic. There is an entire sequence of court decisions
supporting our case, spanning 10 years."

Richards outlined the Supreme Court and Constitutional Court decisions
upholding the legality of the original sale of the shares, and reaffirming
the rights of the owners.

"We invite the Government to work with us to solve this issue, and
explore how our partnership can increase prosperity for all Slovakians, not
just the few that currently benefit from this asset. We are aware that the
Government has accused several people of wrongdoing, and we believe it is an
increasingly desperate attempt to divert attention from the legality of the
sale, and the illegality of their maneuvering to keep control of
Transpetrol."

"This is the people's asset - it should be run for the benefit of the
people. We believe transparency and our management expertise will help the
Government do that."

In answer to questions, Richards stated bluntly that "we have no
connection to Russia, Russian investors, or any entity in the Russian oil and
gas industry."

He confirmed that CAPPA has entered discussions with the Slovakian
Government, but refused to disclose details. Asked about the upcoming
elections, Richards said CAPPA will work with any democratically elected
leader of the country.

CAPPA has no connection to Mr. Ilcisin, Richards stated. "We don't know
him, and we have no opinion on his case; he is irrelevant to our purchase."

In closing, Richards asserted, "They have joined the EU [and] … are
bound by international agreements to respect the rule of law and private
property…. They cannot continue to ignore this. We will use all available
options to secure our rights."

A transcript of the press conference is available at: www.cappa.us

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Steve Richards |
https://profnet.prnewswire.com/Subscriber/ExpertProfile.aspx?ei=92690

Bart Marcois, +1-202-517-0155, ext. 218, pr at cappa.us