Memorandum of Understanding

Crescent Hydropolis Resorts PLC
27 February 2007


                        CRESCENT HYDROPOLIS RESORTS PLC

                           Isle of Man - Munich - Qingdao

                                  ANNOUNCEMENT


                          Middle East Projects Update


Crescent Hydropolis Resorts PLC (the Company) is pleased to announce that the
Company has entered into a binding Memorandum of Understanding (the Memorandum)
with His Excellency, Shaikh Fawaz Abdullah Al Khalifa (Shaikh Fawaz), a member
of the Royal Family of Bahrain, an exclusive right to assist the Company in
launching Hydropolis projects in one or more of the Sultanate of Oman (Muscat),
the Kingdom of Saudi Arabia (Jeddah) and the United Arab Emirates (Dubai) (the
Exclusive Countries).

Shaikh Fawaz is chairman of Al Fawaz Investment Group, based in Manama, Bahrain
and Dubai, United Arab Emirates. Prior to founding Al Fawaz Investment Group in
1997, he started his public service career as a member of the Division of
Military Security and Intelligence of the Bahrain Defense Force, serving from
1986 until 1989. He then served as Public Relations Advisor to the Minister of
Information at Bahrain's Ministry of Information from 1989 until 1991. From 1991
until 1997, he was the director of public relations at Bahrain's Ministry of
Planning (Central Organization of Bahrain Statistics, formally). Shaikh Fawaz
earned his Masters in Public Relations from Cairo University in 1986.

The Memorandum signed in Dubai on February 25th calls for a term of six months
(with an option to renew the retainer for a further six months) during which
Shaikh Fawaz shall seek to procure in the Exclusive Countries, on terms
acceptable to the Company in its sole discretion, (i) licensing, building
permits and other necessary regulatory authorities the; and (ii) land, land
leases and the corresponding sea rights for any project. It is anticipated that
land rights may be contributed by Shaikh Fawaz in consideration for equity in
the Company's local project development company formed at such time that a
project is granted full licensing and approvals.

The Company will pay Shaikh Fawaz's reasonable out-of-pocket expenses up to a
maximum value of $100,000 (One Hundred Thousand USD) during the period and bears
responsibility for providing his legal and technical advisers with all necessary
project presentations, technical specifications and feasibility studies as shall
be needed to provide information to governmental authorities in each Exclusive
Country. The Company is obligated to provide a Franchise License to the local
project development company for each project that is granted governmental
approvals, but only at such valuation as determined by the Company's directors
in their sole discretion.

Under the terms of the Memorandum, the Company shall provide each project
proposal approved by the government of an Exclusive Country with a viable
financing proposal that has been approved by the Company's directors, the
Company's nominated adviser, auditors and counsel. Shaikh Fawaz reserves the
right to make additional investments himself in each project as well as to bring
local investors in each country into the financing structure for each approved
project.

In the event of a success in gaining licensing and permit approvals, and in
securing the land or land lease and corresponding sea rights for a project on
terms acceptable to the Company, the Company has agreed with Shaikh Fawaz to pay
an arrangement fee equal to 1.00% of the total project cost, as estimated by the
Company's project managers, SIBC Industrial Building Consultants GmbH, in
ordinary shares of the Company.

'We are very pleased to join forces with a leading member of Bahrain's business
community and the ruling family to further the Company's objectives in bringing
Hydropolis to the Middle East.', said Mansoor Ijaz, vice chairman of the Board,
after concluding negotiations with Shaikh Fawaz.

'We believe we can bring great value through our established relations
throughout the Gulf region to the shareholders of the Company, and we are
prepared to contribute our own equities to this important project. We will work
very hard with the Company to bring an important Hydropolis project to life in
Oman, Dubai and Saudi Arabia', said Shaikh Fawaz.


Mansoor Ijaz
Deputy Chairman
[e-mail]


27 February 2007


Jonathan Naess
Nabarro Wells & Co. Limited
Nominated Adviser
0207 710 7400


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