Amsterdam, July 15, 2010 - Following the press release dated May 17, 2010, Kardan N.V. ("Kardan"), active in Real Estate, Financial Services and (Water) Infrastructure in emerging markets, announces that its (water) infrastructure subsidiary Tahal Group International B.V. ("Tahal") signed an agreement ("the Agreement") with FIMI, an Israeli private equity fund, pursuant to which FIMI undertakes to provide Tahal a loan of up to USD 50 million (approximately EUR 40 million). In exchange, FIMI will receive warrants in an amount of up to USD 50 million (approximately EUR 40 million) to purchase an equity stake in Tahal based on a pre-money company valuation for Tahal which shall be the lower of (a) USD 250 million plus interest or (b) 25% discount on the company valuation at an exit event (such as an IPO).

The lack of clean water in emerging markets provides numerous opportunities for Tahal, with substantial returns on investment. The co-operation with FIMI would further support Tahal's robust investment plan in the (water) infrastructure market.

According to the Agreement, FIMI will lend Tahal an amount of USD 25 million (approximately EUR 20 million) upon closing of the transaction and provide an additional commitment in the same amount which will be available for one year after closing. The loan is to be repaid in four years and bears an interest of 6 month Libor plus 3% per annum (the "Loan").

On the basis of the Agreement, Tahal will issue warrants to FIMI, which entitle FIMI to purchase shares in Tahal in the amount of the Loan outstanding based on a company valuation for Tahal equal to the lower of (a) USD 250 million increased by 5% annually (subject to certain adjustments, as detailed in the Agreement) or (b) in case of an exit event such as an IPO, at a 25% discount from the valuation of Tahal at such exit event. The warrants expire at the earlier of the lapse of four years from closing or upon an exit event. Kardan has the option to buy back up to 60% of the warrants at an IRR for FIMI of 17.5% (provided that a pro-rata portion of the Loan shall be repaid at that time) ("Call Option"). The Call Option can be exercised in the six months period commencing two and a half years from closing, or earlier in certain events.
Kardan and FIMI have also sig ned a shareholders' agreement providing for certain customary rights and obligations.

Closing of the transaction is expected to take place in August 2010.

Poalim Capital Markets which is part of Bank Hapoalim, a leading Israeli bank and financial services group, advised Kardan on this transaction.