PROJECT DESCRIPTION Lidl, a chain of discount grocery stores owned by the Schwarz Group (the "Group" or the "Company") is implementing a long-term expansion plan in Romania by opening new Lidl discount stores ("Lidl Romania" or the "Project"). The Group, one of the largest European food retail discounters, has requested IFC to provide a long-term loan to its Romanian subsidiaries to partially finance the Project. PROJECT SPONSOR AND MAJOR SHAREHOLDERS OF PROJECT COMPANY The Schwarz Group is a private company based in Germany. It is involved in discount food retail through two brands: Lidl (discount supermarket format) and Kaufland (discounting hypermarket format). It is one of the largest and fastest growing European discount retailers and has good presence in many western European countries as well as in Central and Eastern Europe.The project companies are Lidl Romania S.C.S., Lidl Discount S.R.L. and Lidl Immobiliare Romania Management S.C.S., which are all wholly owned by the Group. TOTAL PROJECT COST AND AMOUNT AND NATURE OF IFC'S INVESTMENT The proposed IFC investment is a EUR50 million A loan for IFC's own account to the Group. IFC INVESTMENT AS APPROVED BY BOARD 66.57 million (USD) PRODUCT LINE IFC INVESTMENT (MILLION USD) 66.57 LOCATION OF PROJECT AND DESCRIPTION OF SITE The Project will involve the construction of new distribution centers and new discount stores located mainly in frontier regions and secondary and tertiary cities of Romania (e.g., Oltenita, Giurgiu, Slatina, Sighetu, etc.). ANTICIPATED DEVELOPMENT IMPACT OF THE PROJECT Improvement in green building standards: As one of the few global retailers in the food discount stores segment in Romania, the Sponsor will, through the Project, contribute to the improvement of local green building standards by applying the highest level of energy efficiency measures, in line with the ones prevalent in its home market of Germany; which would help the new Lidl stores exceed IFC's Green Building standardFood Supply chain development: Schwarz's expansion will (i) increase the number of its local suppliers, (ii) provide additional sales channels for local fresh and dry food producers in Romania, and (iii) contribute to improvements in food security and availability, as well as in efficiency and operating standards throughout the supply chain.Benefits to low income consumers: By expanding the modern discount format in frontier regions and secondary and tertiary cities of Romania, Schwarz will be able to improve access of local low income customers to a more affordable diverse selection of high-quality food products.Employment generation: The Project will create significant local direct employment (mostly women who represent more than 60% of Lidl employees), and indirect employment in the retail value chain. IFC'S EXPECTED DEVELOPMENT CONTRIBUTION Provision of long-term financing: As IFC is well familiar with the Sponsor, it will be able to provide Schwarz with a sizeable loan to its Romanian subsidiaries in a swift manner and on conditions well tailored to reflect the Project profile, which has been difficult to raise in the current European markets conditions.Environmental and social performance: IFC's E&S expertise will ensure that the Project be implemented based on the high relevant standard in an environmentally and socially sustainable and responsible way. ENVIRONMENTAL AND SOCIAL ISSUES - CATEGORY B The key environmental and social issues for this multi-site retail transaction relate to Lidl Romania's management of ongoing environmental, health and safety and labor issues in the construction and operation of its stores and distribution centers, with particular focus on environmental assessment and planning requirements, provision of safe and fair working conditions, occupational health and safety, energy efficiency and management of greenhouse gas emissions arising from energy use and release of refrigerants, solid waste management, life and fire safety and land acquisition.These issues may all be readily mitigated and are relatively minor and reversible. This is therefore an environmental and social Category B project.

ACCOUNTABILITY MECHANISM OF IFC The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org. You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org/