Assaf Barnea

CEO

March 2008

Israel- Positioned as a Know-How leader in the Global Water Market

• World largest Desalination plant Ashkelon (RO)

• World record in waste water reuse (75% of total consumption,

next Spain 12%).

• Leading position in Dripping Irrigation systems.

• Unique integrated water management system (4 water sources to one system).

• Unique National carrier project including

• 4th largest Filtration plant in.

• Leader in Technology Innovations

A Known Hub of Innovations & Technologies

The first “Exit”… in water..probably not the last

Ben Gurion: a new perspective on Water and Science

( (Sede Boqer 1955

• “The prophets in the Bible never accepted

the droughts of the Negev and envisioned

that one day “water will flow out of the

desert and streams from the Arava valley.”

• “It is here in the Negev that scientists and

researchers are faced with the challenge of

transforming sea water into fresh water”..

Israel’s national program for promoting the country’s water industry -Agamim 10

“NewTech”

Comprehensive governmental

policy

Dedicated Incubators

for water technologies

Mekorot’s Encore Role

Funding and capital

Strengthening Academic

Research

Supporting international cooperation

Israel’s Incubator Program

The Kinrot Incubator-Profile• Israel’s first and only Water Dedicated Incubator.

• Privately held by the Canadian Stern Group in cooperation with the Israeli Chief Scientist and a local management team.

• Strategic Partnership with Israel’s national water company Mekorot.

• Advisory Board composed from Israel’s best water experts.

• Focusing on screening the most promising ideas from Israel’s top academy and water institutions.

• A solid platform for developing and commercializing water innovations.

Total Assets- $ 3 B

AAA rating

$ 600 M revenue

2000 employees

80% of the total water consumption

Mekorot – Israel’s National Water CompanyMekorot – Israel’s National Water Company

The Kinrot’s Incubator Portfolio• Eltav –Wireless solution for valves in the process

industry.

• C Filter- membranes from Composite materials.

• Agrifect Agrifect .ppt

• Aqua Digital- digital flow meter

• Locyan- Biological solution for cyanoric acid in swimming pools

Following the approval of the OCS-a start up is born in the Incubator

Idea

Patent

Technology

Exit towards

an Exit

Initial screening of the Deal flow by the Incubator

R&D of the incubator company towards Beta testing

The Incubator Platform-

Initial sales, external rounds of Financing

The ROI -Evaluating the Start Up DNA

…”Show me the Money ”…

“A Genius is an African who dreams up snow” Vladimir Nabokov

• Promising Entrepreneurs.

• Ideas that can transform into technologies.

• Strategic Partners.

• Potential Investors.

• Beta Site with potential customers.

It just looks transparent… but there is no such thing as “Just Water”..

Water Technologies- Atlantium

Bio films and Fish tank disinfections

• Blue I offers advanced analytical systems and support

for total water quality management.• About 25 people, offices in Tel Aviv and Production

line in Jerusalem.

• Initial sales through global distributors.

• Beta Agreement with Mekorot- Multi Parameter

sensor

• Estimated time line - 6 Months at Mekorot Premises.

Water Technologies – Blue I

Israel Water Industry by Sector (2005)

Export activity),M 900$)

45%

27%

13%

8%

8%

4% 2%

Irrigation and

Agricultural

projects & products

400

Valves&

Meters

190

Engineering &

Projects

115

Filters

70

Desalination

Pipes

70

30

Others

133%

27%

13%

8%

8%

7%

4%

New companiesNew companies Established companiesEstablished companies)108 companies)

Water Purification

and Improvement

36

Wastewater Treatment

30

Flow & other control

14

Measurement

&

Analysis

9

Efficiency improvem

ent

8

Water security

7 D

esalination4

Quality

Improvement

Flow Control

&Management

Efficiency

Improvement

Southern MID-West

California

Death Valley

ArizonaNevada

Israel - the Beta Site Bridge for Water Innovations

Water Technologies Market

65%

25%

10%

Infrastructure)Construction & management)

• Basic equipment )pumps, pipes)

• Construction

• Basic agriculture equipment

• Municipal water utility

management

B230-260$

B80-100$B35-40$

400B$ Water

Technologies

• Water Treatment) municipal, industrial)

• Desalination and waste water treatment• Water monitoring and

equipment control• Water security

Other

•

Consulting and

engineering

•

Residential products

(2006)

Depleting Resource – Future Global Water Shortage

Source: Seckler et al, 2002*varies according to definition

Water Shortage Areas

People living under water stress*

1B2004

3B2025

Water Demand Growth Exceeds Population Growth

A Significantly Growing MarketA Significantly Growing Market

6-7%6-7%

10-12%10-12%

Traditional segmentsAccelerated growing

segments

Forecast for annual growth rates

for the years 2004-2008

7-8%7-8%

$600-800B

$500-600B

$400-450B

$300B

ElectricPower )E(

Semiconductor

$400B

CellularWater

IT

$600-650B

A comparison between global markets

TelecomEquipmentPharma

$200-250B

Biotech

$40B

Singapore-a tip of the iceberg

Targeting Water Market Opportunity

GlobalWater

Market

Compa

nies

Investment

Funds

States

• Designated funds )enhanced in 2005(

• Traditional investment entities taking part

Source: Israel Venture Association

Israel- “The Silicon Valley of Europe”Israel- “The Silicon Valley of Europe”M&A Transactions (1996-2005)M&A Transactions (1996-2005)

9

12

21

38

63

28

65

61

58

34

389

Total Number of Deals

456

666

1,306

4,267

16,065

581

2,273

1,189

1,834

2,475

31,112

Total Volume ($M)Year

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Total

“Come on in, the Water is fine”…

Thank you

Assaf Barnea, CEO

abarnea@kinrot.com

26

Agrifect

Fertigation Control & Management

March 2008March 2008

27

Optimize Water usages (Irrigation)

Optimize Fertilization usages

Improving (Quantity & Quality) yields

Saving costs.

Comply with agriculture standards (EurepGAP etc.)

Minimize detrimental environmental – Aquifer Pollution

The Need - Filed Crops

28

Mass labor procedures (manual) aimed at meeting the “Repeatability” test.

No available agronomic consultant support

Analyze Test Results - knowledge gap.

Many years of habit (Culture)

Currently Fertigation price is not too high

None Standards Bodies Enforcement

The Problem

29

Agrifect Mission

Delivery of a comprehensive solution

An automatic Sampling,

Monitoring )i.e. NO3, EC(,

and Farmer Fertilization recommendation

to the Precision Farming market.

30

Crops required chemical fertigation in:

regular soil

combined media )soil and substrate(

Millions of farmers worldwideMillions of farmers worldwide

Potential Market