WWW.EXFILE.COM, INC. -- 13929 -- MEDIS TECHNOLOGIES LTD. -- EXHIBIT 10.1 TO FORM 10-Q


    EXHIBIT
      10.1






     


    Capital
      Equipment Purchase Agreement

    


    More
      Energy Ltd.

    2
      Yodfat
      Street

    Global
      Park, PO Box 1112

    Lod
      71291


    Israel

    and

    Ismeca
      Europe Automation SA

    Rue
      de
      l’Helvétie 283

    CH
      - 2301
      La Chaux-de-Fonds 

    Switzerland

    


    are
      the
      parties to the present agreement.

    


    WHEREAS

    More
      Energy Ltd. (“More Energy” or “Customer”) and Ismeca Europe Automation SA
      (“Ismeca” or “Seller”) have agreed to enter into this Purchase Agreement under
      which Customer will purchase from Seller the Deliverables (defined herein),
      all
      in accordance with the terms of this Agreement. Customer will issue a formal
      Purchase Order to implement this Purchase Agreement:

     

    EFFECTIVE
      DATE.
      The
      Effective Date of this Purchase Agreement shall be September 21st, 2005.


    


    1.     ENTIRE
      AGREEMENT AND SELLER’S BASIC UNDERTAKING 

    


    
      	1.1	
              This
                Purchase Agreement contains the complete, final and exclusive agreement
                between More Energy and Seller regarding the goods and services ordered
                under this Agreement and the corresponding PO. Except as otherwise
                explicitly agreed by More Energy in writing, conflicting, different
                or
                additional terms (including, but not limited to, those set forth
                in the PO
                and in the Proposal) are expressly rejected and acceptance of this
                offer
                is expressly limited to the terms set forth
                herein.

            


    

    


    
      	1.2	
              Seller
                hereby undertakes to carry out the project hereunder, including the
                delivery of Equipment, Documentation and Services as described in
                detail
                in Annex 1 hereto, in accordance with the highest standards in the
                industry and in compliance with the Program Schedule attached hereto
                as
                Annex 2 and the Specification attached hereto as Annex 3, as same
                may be
                updated and modified by mutual written agreement of Seller and Customer
                from time to time.

            


    

    


    2.    PRICE
      AND INVOICING

    


    
      	
              2.1
                

            	
              The
                prices for the Equipment, Documentation and Services are as indicated
                below and in Annex 1 hereto, are payable in Swiss Francs, and shall
                remain
                in effect during the duration of the project unless modified by mutual
                agreement. 

            


    

    


    
      	
            	 	
              Prices
                made to Seller are indicated in Swiss Francs and are fixed and not
                subject
                to any escalation.

            


    

    


    
      	2.2	
              Prices
                are net excluding shipping, insurance and, packing, in accordance
                with the
                EXW conditions of the 2003 Incoterms, excluding VAT, without any
                deductions. They shall 

            


    

    


    
      
        Capital
          Equipment Purchase Agreement

        
        

      

      
        -1-

        
          

        

      

      
         

      

    

    
      


      
        	 	
                be
                  valid for the Order as defined in the Confirmation however they
                  may be
                  modified by Ismeca and More Energy in case of changes made by the
                  Customer
                  to its Order (specifications, deadlines, quantities, etc. of the
                  Product
                  or the Component) or in case of a delay following a reason attributable
                  to
                  the Customer. Seller’s prices for the Equipment do not include the
                  following items which, when applicable, shall appear as separate
                  additional items on the appropriate invoice:


              


      

       

    

    
      
        
          
            
              
                
                  
                    
                      	
                            	
                              a.

                            	
                              Sales
                                and use
                                taxes.

                            


                    

                  

                

              

            

          

        

      

    

    
      
        
          
            	
                  	
                    b.

                  	
                    Customs,
                      duties, licenses, import duties, and export
                      fees.

                  


          

        

      

    

    
      
        
          	
                	
                  c.

                	
                  Packing,
                    shipping, transportation, insurance or freight to the production
                    site or
                    sites (as determined by More
                    Energy).

                


        

      

    

    
      	
            	
              d.

            	
              Installation
                of the equipment at the production site or
                sites.

            


    

    
      	
            	e.	
              Site
                acceptance tests (SAT)

            


    

    


    At
      such
      time as the Parties define the scope of work for d and e above, Seller shall
      quote same based upon its standard hourly rate for the Seller personnel to
      be
      involved in the effort, plus reasonable out of pocket expenses, and the parties
      will negotiate a mutually acceptable price.

    


    
      	2.3	
              Seller
                shall issue individual invoices for required milestone payments per
                line.
                Payment for the Equipment shall be separated into five equipment
                groups or
                sub-systems, respectively:

            


    

     

    
      	·  	
              Machine
                1-
                CHF 2’914’000

            


    

    
      	·  	
              Machine
                2-
                CHF 1’321’000

            


    

    
      	·  	
              Machine
                3 and its’ associated Leak Tester - CHF
                2’726’300

            


    

    
      	·  	
              Machine
                4 and its’ associated Leak Tester - CHF
                980’000

            


    

    
      	·  	
              Machine
                5 and the Machine buffers / interface - CHF
                4’051’000

            


    

    
      	·  	
              PCB
                cutting machine, pouch machine, packaging, and Line Supervision -
                $ CHF
                2’077’000

            


    

    


    
      	2.4	
              Invoices
                will be generated for each of the above sub-systems and are to be
                based on
                the following schedule.

            


    

    


    
      	
            	a.	
              15%
                of
                the line amount at order placement.

            


    

    
      	
            	b.	
              15%
                of
                the line amount at completion of mechanical design review for each
                such
                sub-systems.

            


    

    
      	
            	c.	
              30%
                of
                the line amount at system “power up” for each such sub-systems.
                

            


    

    
      	
            	d.	
              30%
                of
                the line amount following successful pre-acceptance at our facility
                (see
                section 3.4 below regarding partial acceptance and partial
                payment)

            


    

    
      	
            	e.	
              10%
                of
                the line amount following a final acceptance at the production
                site.

            


    

    


    Invoices
      shall be paid by Customer net thirty (30) days after its receipt of the original
      invoice and (except for a above) a Certificate of Milestone Completion signed
      by
      Seller and Customer’s designated representatives. 

    


    3.    ACCEPTANCE
      CRITERIA

    


    There
      are
      to be two acceptance test runs, one at Seller’s plant to confirm system
      conformance with the Specification and the Acceptance Test Criteria, and one
      at
      the production site to reconfirm confirm system conformance with the
      Specification and the Acceptance Test Criteria after shipping and
      reinstallation. The Parties will, in accordance with the Program Schedule,
      mutually agree on a detailed Test Plan for each acceptance test as well as
      Acceptance Test Criteria for successful passage of such tests.

    


    
      
        Capital
          Equipment Purchase Agreement

        
        

      

      
        -2-

        
          

        

      

      
         

      

       

    

    The
      pre-acceptance test run will be for two complete runs of four hours each and
      will occur at Seller’s plant. The test will assemble and test the More Energy
      product as described in Annex 1. Seller will provide engineering and technician
      support and conduct the acceptance test run. Customer may have its project
      engineer, and any other personnel its selects, present for these test runs.
      During the test run, the machine shall comply with the Acceptance Test Criteria,
      as well as meet the following criteria:

     

    
      	3.1	
              The
                machine shall achieve a net throughput, after reductions for downtime
                and
                yield losses, of at least 8’996 accepted units (which represents an
                average overall line efficiency of 85% and yield of 98% at the rated
                system throughput rate of 45 parts per minute). For this test run
                the
                system will start from a “full machines / full buffers” condition and the
                counters reset at that point. Note; system throughput is the determining
                factor; cycle rates of individual assembly cells may fluctuate in
                order to
                meet the target throughput rate. 

            


    

     

    
      	3.2	
              Downtime
                and yield losses due to non-machine causes shall not count against
                machine
                performance.
                Downtime and yield losses due to non-machine causes may result from
                the
                following:

            


    

    


    ·  Shortage
      of bulk parts in feeding systems

    ·  Depletion
      of fluids in dispensing systems

    ·  Out-of-specification
      components 

    ·  Operator
      failure

    ·  Downtime
      directly caused by processes which are mandated by Customer

    ·  Failure
      of air, vacuum, or incoming power supplies

    


    Preliminary
      acceptance shall occur upon successful completion of this test as evidenced
      by
      the signature of both Customer and Seller’s designated representatives on a
      Milestone Completion Certificate. In the event of any failures in the test,
      Seller shall correct the failed items on a timely basis and submit the system
      or
      relevant subsystem for retest in accordance with the mutually agreed Test Plan
      and Acceptance Test Criteria. 

    


    
      	3.3	
              A
                second and final Acceptance Test will be performed at the production
                facility (currently expected to be at CELESTICA’s facility in Ireland),
                consisting of three complete runs of four hours each. These tests
                are to
                confirm that no damage resulted from transit, and that the installation
                has been correctly completed. The same Acceptance Test Criteria shall
                apply to this final Acceptance Test. Final acceptance shall occur
                upon successful completion of this test as evidenced by the signature
                of
                both Customer and Seller’s designated representatives on a Milestone
                Completion Certificate. In the event of any failures in the test,
                Seller
                shall correct the failed items on a timely basis and submit the system
                or
                relevant subsystem for retest in accordance with the mutually agreed
                Test
                Plan and Acceptance Test Criteria. The Seller’s cost for such retest shall
                be at its own expense. 

            


    

    


    
      	3.4	
              When
                possible, the entire line will be tested together as a complete system.
                When for reasons of component availability and or process related
                issues a
                full line pre-acceptance is not possible, the parties agree to accept
                (test run) individual sections of the line using the same acceptance
                criteria as indicated above. In this case, pre-acceptance of a section
                will result in a 15% payment to Ismeca for the respective section
                approved
                by Customer with the 15% balance (under 2.4(d) above) being payable
                together with the final acceptance under 2.4(e) above. Invoicing
                of
                accepted sections of the line (pro-rata based upon their relative
                values
                as indicated in above in 

            


    

    
       

      
        
          Capital
            Equipment Purchase Agreement

          
          

        

        
          -3-

          
            

          

        

        
           

        

      

       

      
        	 	
                section
                  2.3) will occur following pre-acceptance. Shipping of accepted
                  sections of
                  the complete line will occur when mutually agreed by More Energy
                  and
                  Ismeca. 

              


      

       

      4.    INDEPENDENT
        AGREEMENTS

    

    


    This
      Purchase Agreement expressly overrides any other terms and conditions regarding
      the Goods and Services (including, but not limited to, the terms and conditions
      set forth in the PO and the terms and conditions set forth in the
      Proposal).

     

    5.    CHANGES

    


    The
      system described in Annex 1 represents Seller’s best understanding of the
      assembly and test requirements of the product being assembled as set froth
      in
      the Specification set forth in Annex 3. Should changes occur in More Energy’s
      product or assembly processes which impact the equipment design, or should
      new
      assembly or test requirements come to light, Seller reserves the right to
      request equitable adjustments to the price and/or delivery of the equipment.
      All
      such changes will be communicated in writing via a “Project Change Notice”
      (PCN). Notwithstanding the above, any deficiencies in the design or workmanship
      of the system set forth in Annex 1 to meet the Specifications set forth in
      Annex
      3 will be corrected at the sole expense of Seller on a timely and expeditious
      basis so as not to delay the overall Program Schedule. 

    


    Further,
      More Energy is entitled, at any time, to request changes to the specifications
      for the Goods and/or Services or any other matters relating to performance
      under
      this Purchase Agreement; provided that the price and/or delivery schedule may
      be
      equitably adjusted with More Energy to reflect additional costs and/or schedule
      adjustments required by the changes. Any change requested that has an impact
      on
      Equipment cost, scope, and or delivery, must be approved of in writing by More
      Energy, if necessary with the appropriate “Project Change Notice” issued, before
      Seller will make such changes. Any claim for adjustment is waived unless made
      in
      writing within thirty (30) days after receipt of More Energy written change
      order. Seller shall not make any change or deviation to Goods and/or Services
      covered specifically by the Proposal, PO, and/or this Purchase Agreement, except
      with More Energy’s prior written consent. Upon approval by More Energy of the
      initial design, any process changes, design changes or deviations considered
      by
      Seller must be submitted to More Energy in writing for review. If changes are
      submitted for approval, the information submitted must include a complete
      description of the change and the effect of the change will have on all
      characteristics of the product. 

    


    6.    WARRANTY

    


    Seller
      warrants, for a period of one (1) year or 8,760 system operating hours
      (whichever comes first) after date of final Acceptance by Customer, the
      equipment to be furnished hereunder will be in full conformity with the
      specifications, drawings, and/or other description furnished by More Energy
      and
      that all items furnished hereunder will be free from defects in design,
      workmanship, materials, and manufacture, and will be fit for the use intended
      by
      More Energy. Such warranty shall be in addition to any warranties of broader
      scope and service warranties and guarantees given to More
      Energy by Seller, shall survive inspection test, acceptance of and payment
      for
      the equipment and shall run to More Energy, its successors and assigns.


    


    All
      warranty service, other than easily accomplished part replacement, shall be
      conducted by Seller or its agents at the production facility in a manner which
      does not 

     

    
      
        Capital
          Equipment Purchase Agreement

        
        

      

      
        -4-

        
          

        

      

      
         

      

    

     

    unreasonably
      disrupt More Energy’s operations, and without additional cost to More Energy.
      Seller will pay all freight for repair and replacement parts under warranty
      sent
      to Seller and back to the More Energy issuing location. All equipment and
      software upgrades, revisions, modifications, etc. will be included in the
      warranty period. 

    


    Seller
      will make every effort to respond to requests by More Energy for warranty
      services within 24 hours of request and in no event shall a response require
      longer than 48 hours. More Energy shall have the right to repair warranty
      defects if Seller is unable or unwilling to repair such warranty defects within
      48 hours of notification of such defects. In the event More Energy elects to
      take this action, it shall be entitled to deduct from any amounts owing to
      Seller the direct and incidental costs incurred in remedying the breach of
      warranty or bill Seller for same if no such payments are due

    


    The
      warranties and representations described in this purchase agreement are in
      lieu
      of other warranties imposed by custom or law of any jurisdiction. Except as
      otherwise expressly set forth herein, Seller shall have no responsibility for
      incidental, indirect, special, punitive or consequential damages, except if
      such
      damages result from: (1) a breach of any or all of Seller’s representations and
      warranties set forth herein, or (2) Seller’s negligence. 

    


    7.    INTELLECTUAL
      PROPERTY PROTECTION AND RIGHTS

    
    

    
      
        Seller
          warrants that the Goods (including but not limited to software) do not
          infringe
          upon any third party’s intellectual property, including patents, copyrights,
          trademarks or trade secrets, and that Seller has all necessary rights to
          sell or
          license the Goods. All rights and interest in the direct liquid fuel cell
          technology of Customer, including any derivative or improvement thereto,
          whether
          developed separately or in connection with this Agreement, shall at all
          times
          belong exclusively to More Energy. Seller will not disclose any Customer
          information or data to any third party without Customer’s prior express written
          consent, nor will Seller use Customers information or data for any purpose
          other
          than the performance of this Purchase Agreement, as amended by the Parties
          from
          time to time. The
          diagrams, drawings, sketches, plans, descriptions, specifications, etc.
          of each
          Party shall remain solely and wholly the property of the Party that prepared
          them and may not be used for other purposes or disclosed to any third party,
          without the prior written authorisation of the Party that prepared them.
          Drawings, etc. that Ismeca has to forward to its subcontractors, confidentially
          and only on loan, for the purpose of performing the task entrusted to them
          shall
          form an exception
          to this rule. 

      

    

     

    8.    TERMINATION
      

    


    More
      Energy may, at any time, direct Seller to suspend or cancel all or any part
      of
      the work. In the event of a suspension and/or cancellation:

    


    
      	8.1	
              More
                Energy shall give to Seller immediate written notice of cancellation
                and/or suspension of delivery and the extent thereof. The effective
                date
                of cancellation and/or suspension of delivery shall be the date Seller
                receives written notice from More Energy, More Energy's proof that
                Seller
                received written notice shall be certified by mail, return receipt
                requested.

            


    

    


    
      	8.2	
              More
                Energy shall pay to Seller all of Seller's costs and expenses incurred
                in
                conjunction with the project, plus a cancellation fee of an additional
                6%
                of the aggregate of such cost and expenses to the date of such
                cancellation. The term “cost

            


    

    


    
      
        Capital
          Equipment Purchase Agreement

        
        

      

      
        -5-

        
          

        

      

      
         

      

      
        


        
          	 	
                  and
                    expenses incurred” includes, without limitation, fees for Seller's
                    services, cost plus Seller's standard mark up for purchased items
                    or
                    services, and commitments to subcontractors and vendors for services
                    and
                    materials in connection with the project. All costs and expenses
                    incurred
                    shall be calculated and paid according to Seller, then Current
                    Time and
                    Material fee at scheduled rates. Seller shall deliver to Customer
                    all of
                    the goods paid for hereunder.

                


        

         

      

    

    
      	8.3	
              Advance
                payments made by More Energy to Seller shall be applied to the
                cancellation charges.

            


    

    


    
      	
              8.4

            	
              a)
                In the event Ismeca 1) breaches any of its material obligations under
                this
                Agreement notwithstanding its good faith efforts to perform this
                Agreement
                in accordance with its terms, then Ismeca will use extraordinary
                efforts
                to cure such breach in the shortest time possible but in no event
                to
                exceed 30 days after receiving written notice from the Customer specifying
                the breach and specifically referring to this section of the Agreement.
                If
                Ismeca demonstrates to Customer’s satisfaction that additional effort
                would impose a disproportionate financial burden on Ismeca to the
                impact
                of the breach on Customer, then Ismeca shall propose to the Customer
                alternate compensatory services of value equivalent to the loss to
                the
                Customer because of Ismeca's breach (such as additional equipment
                to
                achieve the specification throughput performance, extended warranty,
                spare
                parts free of charge, and/or other free services of substantial value
                to
                the Customer as determined together with the
                Customer).

            


    

    


    
      	 	
              b)
                Notwithstanding the aforesaid, in the event the breach by Ismeca
                substantially impacts the underlying assumptions of this Agreement
                as to
                the throughput performance of the line, Ismeca shall within one week
                of
                identifying such breach, inform Customer in writing of the ability
                to cure
                same and the time required to do so. If Ismeca cannot cure such breach
                within 60 days of Customer’s written notice, then the Customer shall be
                entitled to, in addition to any of its other rights at law or equity,
                terminate this Agreement in whole or in part, at its discretion,
                and
                Seller will be obligated to refund to Customer the monies paid to
                Seller
                with respect to the terminated part of this Agreement with interest
                at
                LIBOR plus 6% from the date of the original payment by Customer and
                any
                terminated equipment shall be returned to Ismeca. For purposes of
                this
                clause alone, a substantial impact shall mean if the line falls short
                of
                the agreed Specification throughput at the specified quality as measured
                at the FAT or SAT by more than 7.5% (i.e., an average gross rate
                which is
                below 45 devices per minute less 7.5% - or an average which is below
                41
                devices per minute gross cycle rate. In the event Customer does not
                exercise its right to terminate, Ismeca shall remain fully responsibility
                to take all necessary steps to cure the breach and to minimize the
                schedule impact on Customer. 

            


    

     

    11.   FORCE
      MAJEURE

     

    Neither
      party shall be liable for delays in delivery or performance, or for failure
      to
      manufacture, delivery or perform under this paragraph, due to, through no fault
      of the party, an act of God, an act of civil or military authority, Governmental
      Priority, strike or other labour disturbances, flood, epidemic, war, or Riot.
      Seller shall not be liable for delays in delivery or performance due to an
      act
      of More Energy that More Energy knew would delay the performance of Seller
      under
      the PO and this agreement, provided that Seller provides More Energy advance
      written notice of action to be performed by More Energy and the date by which
      such action must be taken to avoid delays. Either party 

     

    
      
        Capital
          Equipment Purchase Agreement

        
        

      

      
        -6-

        
          

        

      

      
         

      

    

     

    will
      notify the other party promptly of any material delay excused by this paragraph
      and will specify the revised delivery date as soon as practicable.

    


    12.   LIMITATIONS
      

    


    Any
      actions or claims by either party under this Purchase Agreement for breach,
      non
      performance or otherwise shall be commenced within twelve (12) months after
      the
      occurrence giving rise to the action or claim.

    


    13.   APPLICABLE
      LAW; JURISDICTION 

    


    All
      disputes in connection with this Contract of the execution there of shall be
      settled by negotiation between two parties whenever possible. The
      place
      of performance and exclusive jurisdiction shall lie in Israel, and all legal
      relations shall be governed exclusively by Israeli Law. 

    


     

    
      
        	More Energy 	Ismeca Europe Automation
                SA 
	 	 
	Signature : _/s/
                Gennadi Finkelshtain_ 	Signature:_/s/_Erik
                Poulsen_______ 
	Name: Gennadi
                Finkelshtain________ 	Name: _____Erik
                Poulsen________ 
	Title:__General
                Manager__________ 	Title: ___Director,
                Sales__________ 
	 	 
	Signature : _/s/
                Israel Fisher________ 	Signature :
                _____________________ 
	Name: Israel
                Fisher_______________ 	Name: ______
                __________________ 
	Title:__Senior
                Vice President Finance_ 	Title: _________________________ 


      

    

     

    
      
        Capital
          Equipment Purchase Agreement

        
        

      

      
        -7-

        
          

        

      

      
        
        

        

      

    

     

    
      

        


        


        


        Confidential

        


        


        


        


        FUEL
          CELL

        


        Automatic
          Assembly and Test

        


        High
          Volume Production Line

        


        For

        


        MORE
          ENERGY(MEDIS)

        


        


        

        

        


        


        ANNEX
          1
          TO PURCHASE AGREEMENT

        


        dated

        


        15th
          September 2005

        




      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          

        

      

      

        


        


        


        TABLE
          OF
          CONTENTS

        


        


        


        

          
            	 	 	 
	
                    1.

                  	
                    INTRODUCTION

                  	
                    3

                  
	
                    2.

                  	
                    THE
                      PRODUCT

                  	
                    4

                  
	
                    3.

                  	
                    DESCRIPTION
                      OF THE EQUIPMENT

                  	
                    5

                  
	
                    3.1.

                  	
                    MACHINE
                      BASE: ISMELINE AND ISMEDIAL

                  	
                    5

                  
	
                    3.2.

                  	
                    FUNCTIONAL
                      DESCRIPTION

                  	
                    8

                  
	
                    4.

                  	
                    CONTROLS

                  	
                    28

                  
	
                    5.

                  	
                    [SUBJECT
                      TO A REQUEST FOR CONFIDENTIAL TREATMENT;

                  	 
	 	
                    SEPARATELY
                      FILED WITH THE COMMISSION] (HMI)

                  	
                    29

                  
	
                    5.1.

                  	
                    STATISTICS

                  	
                    30

                  
	
                    5.2.

                  	
                    ELECTRICAL

                  	
                    30

                  
	
                    5.3.

                  	
                    ISMECA
                      STANDARDS

                  	
                    31

                  
	
                    5.4.

                  	
                    LINE
                      MULTI MACHINE

                  	
                    31

                  
	
                    6.

                  	
                    WORKING
                      ENVIRONMENT

                  	
                    32

                  
	
                    7.

                  	
                    SCOPE
                      OF WORK

                  	
                    33

                  
	
                    8.

                  	
                    COMPONENTS
                      REQUIRED FOR EQUIPMENT TEST

                  	
                    34

                  
	
                    9.

                  	
                    PRICE
                      AND DELIVERY

                  	
                    35

                  
	
                    9.1.

                  	
                    DELIVERY
                      TIME

                  	
                    35

                  
	
                    9.2.

                  	
                    PAYMENT
                      TERMS

                  	
                    36

                  
	
                    9.3.

                  	
                    WARRANTY

                  	
                    36

                  
	
                    9.4.

                  	
                    MAINTENANCE
                      CONTRACT

                  	
                    36

                  
	
                    9.5.

                  	
                    TRAINING
                      OF YOUR PERSONNEL

                  	
                    36

                  
	
                    9.6.

                  	
                    INSTALLATION
                      AND COMMISSIONING

                  	
                    36

                  
	
                    9.7.

                  	
                    CONFIDENTIALITY

                  	
                    36

                  
	
                    10.

                  	
                    APPENDIX
                      PACK

                  	
                    37

                  
	
                    11.

                  	
                    CONTACTS

                  	
                    38

                  
	
                    12.

                  	
                    GENERAL
                      CONDITIONS OF SALE AND DELIVERY 

                  	 


          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          

          Annex
            1 to Purchase Agreement

        

      

      
         

        1.  INTRODUCTION

         

        This
          Annex 1 to the Purchase Agreement between More Energy ltd., a subsidiary
          of
          Medis Technologies Ltd. (hereinafter “More/Medis”) and Ismeca Europe Automation
          SA (hereinafter “Ismeca”) sets forth a detailed description of the production
          line to be designed and built by Ismeca for More/Medis for the assembly
          and test
          of the More/Medis Fuel
          Cell product as defined in the More/Medis
          Specification dated 24th
          May
          2005, together with related project and line documentation and certain
          services
          (e.g., testing and training). The production line is sometimes herein referred
          to as the system or the Equipment.

        


        This
          production line has been designed by Ismeca to meet the More/Medis
          Specifications and is based on Ismeca’s standard [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          and [Subject to a request for confidential treatment; Separately filed
          with the
          Commission] platform
          bases.

        


        The
          production line design is a Fully
          Automatic Stand - Alone Production Line with a design life of twenty (20)
          years.
          The
          system will operate at an Output
          Rate of > 1.80 Million Devices per Month
          gross.
          Using your calculation as written in your RFQ, when calculated through
          - 1.80 M
          / 27.9 days utilizing an 85% up time / efficiency with a 98% yield we achieve
          a
45
          parts per minute gross cycle rate.
          (Based
          upon the More/Medis specification calculations Ismeca estimates around
          1.50
          Million Devices per month net
          output).

        


        The
          system is based largely on mechanical cam driven operations and synchronisations
          rather than electronic drives. 

        


        Ismeca
          has partnered with 6 suppliers to work with it to build the line,as follows:.
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          have
          been
          consulted for all welding processes, [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          for
          all
          leak testing requirements, [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          for
          the
          vacuum forming of the pouches, together with [Subject
          to a request for confidential treatment; Separately filed with the
          Commission],
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          and
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          for
          the
          final packaging. Ismeca’s
          forté is automated assembly, line integration / interfacing and Project
          Management and Ismeca selcts as its
          partners
          companies which are leaders within their field to optimize the final line’s
          performance. NOTWITHSTANDING THE ABOVE, ISMECA REMAINS DIRECTLY RESPONSIBLE
          TO
          MORE/MEDIS FOR THE PERFORMANCE OF THE PRODUCTION LINE AND ALL OF ITS ELEMENTS
          IN
          ACCORDANCE WITH THIS PURCHASE AGREEMENT.

      

       

      
        	
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                  Septmber 2005

              	
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                  Europe Automation SA

              	
                Page
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          Annex
            1 to Purchase Agreement

        

      

       

      

        
           

           

           

           

           

           

           

           

           

           

           

           

           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
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            Annex
              1 to Purchase Agreement

          

        

         

        2.  THE
          PRODUCT

         

        


        


        The
          preliminary design of the product consists of the following 19 individual
          components. The supply format for each component shall be defined in final
          spec
          documents in accordance with agreement schedule, however the starting
          assumptions are: 

        


        
          	
                	*	
                  *

                


        

        
          	
                	*	
                  *

                


        

        
          	
                	*	
                  *

                


        

        
          	
                	*	
                  *

                


        

        
          	
                	*	
                  *

                


        

        
          	
                	*	
                  *

                


        

        
          	
                	*	
                  TBD

                


        

        
          	
                	*	
                  TBD

                


        

        
          	
                	*	
                  TBD

                


        

        
          	
                	*	
                  TBD

                


        

        
          	
                	*	
                  TBD

                


        

        
          	
                	*	
                  TBD

                


        

        
          	
                	*	
                  TBD

                


        

        
          	
                	*	
                  TBD

                


        

        
          	
                	*	
                  TBD

                


        

        
          	
                	*	
                  *

                


        

        
          
            	
                  	*	
                    *

                  


          

        

        
          	
                	*	
                  *

                


        

        
          	
                	*	
                  *

                


        

        _____

        *[Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
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            Annex
              1 to Purchase Agreement

          

        

      

       

      
        
          	3.  	
                  DESCRIPTION
                    OF THE EQUIPMENT

                


        

         

        The
          line
          will operate at an Output Rate
          of > 1.80 Million Devices per month, gross.

         

        
          	3.1. 	
                  MACHINE
                    BASE: [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission] and
                    [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

        The
          line
          is based on using 2 different standard Ismeca base chassis’. Set forth below are
          details of the Ismeca [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          and
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          chassis,
          both of which are structured using similar cam driven designs. Most of
          the
          Ismeca standard station designs are compatible to both chassis types,
          incorporating both internal and external mounting for our stations /
          modules.

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        The
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          SC
          is a
          synchronized cam actuated linear system. The indexing segments are [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]
          apart
          and designed specifically for multi up high speed automation. Each segment
          can
          support a mass of [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]
          in
          weight. The [Subject
          to a request for confidential treatment; Separately filed with the Commission]
           SC speed capacity is greater than [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]
          cycles
          per minute.

        


        The
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          SC
          indexer is a rugged execution designed and built to run flawlessly in production
          environments. It provides excellent indexing smoothness and positioning
          accuracy
[Subject
          to a request for confidential treatment; Separately filed with the Commission]
          in
          real
          fast index time. The welded steel frame is enclosed with stainless steel
          doors,
          and the safety enclosure is made of folded and welded stainless steel panels.
          The wide roof opening allows air flow.

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        The
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          SC
          has
          been designed for a high level of compatibility with the rotating 

        
           

          
            	
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                      Europe Automation SA

                  	
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          SC
          standard base using the same ‘bricks’ (modules and objects). The synchronized
          cam driven stations are similar to those of the [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          SC
          and
          Pallet Free Linear; thus keeping Ismeca standardization throughout.

         

         

         

         

         

         

         

         

         

      

      
         

        
          	
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                    Septmber 2005

                	
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                    Europe Automation SA

                	
                  Page
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          Annex
            1 to Purchase Agreement

        

      

       

      

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        The
          [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]’ [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          chassis
          is synchronised by cams. The [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          indexer
          is a rugged execution designed and built to run flawlessly in production
          environments. It provides excellent indexing smoothness and positioning
          accuracy. [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          Proven
          standard modules used by Ismeca today will be implemented where possible,
          however, where engineering trials of ‘special stations’ are needed, this will be
          discussed between both parties.

        


        


        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        


        
           
An
          example of a similar machine

        


        
           

          
            	
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                      Europe Automation SA

                  	
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

         

        
          	3.2.  	
                  FUNCTIONAL
                    DESCRIPTION

                


        

         

        


        Description
          of the machines / stations

        


         

        The
          parts
          are assembled in nests on the various machine platforms. Some open stations
          are
          provided to allow for easy access to the machine stations and for future
          retrofits yet to be decided or discussed.

         

         

        As
          a
          general rule, each time a part is presented and loaded onto the machine,
          its
          presence is checked. The method is either to use a sensor to check for
          the part
          presence or to check the gripper position. Closed loop logic is used throughout
          the machine.

         

        Hopper
          sizes for all bowl feeds will be sufficient to run for a minimum of [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          production
          - Size of hoppers for ergonomic reasons are to be discussed.

        


        It
          is
          foreseen to include a [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          part
          tray
          buffer between machines for all buffers mentioned herein. 

        


        


        Machine
          1a and 1b

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Please
          refer to the drawing 050604-100-B attached.

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        


        Machine
          1a

        [Subject
          to a request for confidential treatment; Separately filed with the Commission],
          here we work 2 up.

        


        Station
          # 1 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 2 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

      

      
         

        
          	
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                    Europe Automation SA

                	
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          Annex
            1 to Purchase Agreement

        

      

       

      

        


        Station
          # 3 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          

        


        Station
          # 4 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        Using
          a
[Subject
          to a request for confidential treatment; Separately filed with the Commission]
          we
          check
          the qualities of the laser mark, if any BAD parts are found then they are
          rejected later.

        


        Station
          # 5 - Free Station

        


        Station
          # 6 - Free Station

        


        Station
          # 7 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 8 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        What
          we have just achieved

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 9 - Free Station

        


        Station
          # 10 - Free Station

        


        Station
          # 11 - Reject of Failed Parts / Check Station or Audit Station
          (Option)

        Failed
          parts are rejected here; parts are picked then placed into separate reject
          bins.
[Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 12 - Free Station

        


        Station
          # 13 - Flip then Offload GOOD Assembled Products onto a Conveyor (Into
          Machine
          1b)

        Here
          we
          pick the part, flip it by 180°’s then offload them onto a tooled conveyor, this
          conveyor drives the assemblies forward directly into machine
          1b.

      

      
         

        
          	
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                    Septmber 2005

                	
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                    Europe Automation SA

                	
                  Page
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          Annex
            1 to Purchase Agreement

        

      

       

      
        Station
          # 14 - Free Station

        


        Station
          # 15 - Free Station

        


        Station
          # 16 - Check and Clean Empty Nests

        Here
          we
          check to ensure the nests are empty [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        


        Machine
          1b

        [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          -
          here we work 4 up.

         

        Station
          # 1 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission] (From Machine 1a)

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 2 - Check Parts Presence

        Here
          we
          check the position and presence of the parts

        


        Station
          # 3 - Free Station

        


        Station
          # 4 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 5 - Check Parts Presence

        Here
          we
          check the position and presence of the parts

        


        Station’s
          6 to 9 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station’s
          10 to 16 - Free Stations

        


        Station
          # 17 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 18 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

      

      
         

        
          	
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                    Septmber 2005

                	
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                    Europe Automation SA

                	
                  Page
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          Annex
            1 to Purchase Agreement

        

      

       

      
        


        Station
          # 19 - Free Station

        


        Station’s
          20 to 23 - [Subject to a request for confidential treatment; Separately
          filed
          with the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        What
          we have just achieved

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 24 - Free Station

        


        Station’s
          25 to 28 - [Subject to a request for confidential treatment; Separately
          filed
          with the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        Station
          # 29 - Reject of Failed Parts / Check Station or Audit Station
          (Option)

        Failed
          parts are rejected here; parts are picked then placed into separate reject
          bins.
[Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 30 -Offload GOOD Assembled Products (Core Assemblies) onto a Conveyor
          (Into
          Machine 1c)

        Here
          we
          offload onto a tooled conveyor the Core Assemblies. [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

         

        Station’s
          31 to 41 - Free Stations

        


        Station
          # 42 - Check and Clean Empty Nests

        Here
          we
          check to ensure the nests are empty [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          

        


        


        Machine
          2

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Please
          refer to the drawing 050604-200-B attached.

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

         

        [Subject
          to a request for confidential treatment; Separately filed with the Commission],
          here we work 2 up.

        


        Station
          # 1 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission](From Machine 1c)

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 2 - Check Parts Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 3 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 4 - Check Parts Presence

        Here
          we
          check the position and presence of the parts.

        
           

          
            	
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                      Europe Automation SA

                  	
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        Station
          # 5 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 6 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 7 - Free Station

        


        Station
          # 8 - Free Station

        


        Station
          # 9 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 10 - Check Parts Presence

        Here
          we
          check the position and presence of the parts.

        


        Station’s
          11 to 16 - Free Stations

        


        Station
          # 17 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 18 - Check Parts Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 19 - Free Station

        


        Station
          # 20 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 21 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 22 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

      

      
         

        
          	
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                    Europe Automation SA

                	
                  Page
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          Annex
            1 to Purchase Agreement

        

      

       

      

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        What
          we have just achieved

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 23 - Free Station

        


        Station
          # 24 - Reject of Failed Parts / Check Station or Audit Station
          (Option)

        Failed
          parts are rejected here; parts are picked then placed into separate reject
          bins.
[Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 25 - Offload GOOD Assembled Products to Conveyor / [Subject to a request
          for
          confidential treatment; Separately filed with the Commission](Into Machine
          5)

        Here
          only
          GOOD assembled products are offloaded onto a tooled conveyor; [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]
          into
          machine 5.

        


        Station’s
          26 to 31 - Free Stations

        


        Station
          # 32 - Check and Clean Empty Nests

        Here
          we
          check to ensure the nests are empty [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        


        Machine
          3

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Please
          refer to the drawing 050604-300-B attached.

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

         

        Assembly
          of the above is whilst working 2 up.

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        Machine
          3a

        


        Station
          # 1 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 2 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 3 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]We
          foresee it only necessary to use [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]
          for this
          operation.

        


        Station
          # 4 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        Using
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          we
          check
          the quality of the laser marks, if any BAD parts are found then they are
          rejected later.

        


        Station
          # 5 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 6 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 7 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        Having
          consulted with [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]we
          recommend to use a welder type of [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          in
          nest
          1. Vacuum extraction is foreseen around this station if dust is generated
          during
          the welding process.

        


        Station
          # 8 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission](Nest 2)

        Having
          consulted with [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          we
          recommend to use a welder type of [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          in
          nest
          2. Vacuum extraction is foreseen around this station if dust is generated
          during
          the welding process.

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        Station
          # 9 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 10 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 11 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission] (Nest 1)

        Having
          consulted with [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          we
          recommend to use a welder type of [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          in
          nest
          1. Vacuum extraction is foreseen around this station if dust is generated
          during
          the welding process.

        


        Station
          # 12 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission] (Nest 2)

        Having
          consulted with [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          we
          recommend to use a welder type of [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          in
          nest
          2. Vacuum extraction is foreseen around this station if dust is generated
          during
          the welding process.

        


        Station
          # 13 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 14 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

        


        Station’s
          15 to 21 - Free Stations

        


        Station
          # 22 - De - [Subject to a request for confidential treatment; Separately
          filed
          with the Commission] (Nest 1)

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]
          in nest
          1.

        


        Station
          # 23 - De - [Subject to a request for confidential treatment; Separately
          filed
          with the Commission] (Nest 2)

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]in
          nest
          2.

        


        Station
          # 24 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      17/43 

                  


          

        

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            

            Annex
              1 to Purchase Agreement

          

        

      

       

      

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 25 - Free Station

        


        Station
          # 26 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission] (Nest 1)

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].

        


        Station
          # 27 - Free Station

        


        Station
          # 28 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission](Nest 2)

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 29 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 30 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 31 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 32 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission](Nest 1)

        Having
          consulted with [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]we
          recommend to use a welder type of [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          in
          nest
          1. Vacuum extraction is foreseen around this station if dust is generated
          during
          the welding process.

        


        Station
          # 33 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission](Nest 2)

        Having
          consulted with [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]we
          recommend to use a welder type of 

        
           

          
            	
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                      Europe Automation SA

                  	
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]in
          nest
          2. Vacuum extraction is foreseen around this station if dust is generated
          during
          the welding process.

        


        What
          we have just achieved

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 34 - Reject of Failed Parts / Check Station or Audit Station
          (Option)

        Failed
          parts are rejected here; parts are picked then placed into separate reject
          bins.
[Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 35 -Offload GOOD Assembled Products ([Subject to a request for confidential
          treatment; Separately filed with the Commission]) onto a Conveyor (Into
          Machine
          3b)

        Here
          we
          offload onto a tooled conveyor the [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].
          This
          conveyor drives the assemblies forward into the [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].

         

        Station’s
          36 to 41 - Free Stations

        


        Station
          # 42 - Check and Clean Empty Nests

        Here
          we
          check to ensure the nests are empty and indeed by using a vacuum manifold
          we
          clean the nests of any debris.

        


        


        Machine
          3b

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        Having
          discussed with [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]we
          will
          require a process time of around [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Machine
          4

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Please
          refer to the drawing 050604-400-B attached.

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

         

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 1 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission](From Machine 3b)

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 2 - Check Parts Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 3 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 4 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 5 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 6 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 7 - Free Station

        


        Station
          # 8 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 9 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      20/43 

                  


          



        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            

            Annex
              1 to Purchase Agreement

          

        

      

       

      

        Station’s
          10 to 16 - Free Stations

        


        Station
          # 17 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 18 - Free Station

        


        Station
          # 19 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 20 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        What
          we have just achieved

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Note:
          [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station’s
          21 to 23 - Free Stations

        


        Station
          # 24 - Reject of Failed Parts / Check Station or Audit Station
          (Option)

        Failed
          parts are rejected here; parts are picked then placed into separate reject
          bins.
[Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 25 - Offload GOOD Filled Products to Conveyor / [Subject to a request
          for
          confidential treatment; Separately filed with the Commission](Into Machine
          5a)

        Here
          only
          GOOD filled products are offloaded onto a tooled conveyor; [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]
          or
          directly into machine 5a.

        


        Station’s
          26 to 31 - Free Stations

        


        Station
          # 32 - Check and Clean Empty Nests

        Here
          we
          check to ensure the nests are empty [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      21/43 

                  


          

        

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            

            Annex
              1 to Purchase Agreement

          

        

      

       

      

        


        Machine
          4b

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        


        Machines
          5a and 5b

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Please
          refer to the drawing 050604-500-B attached.

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

         

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        


        Machine
          5a

        Station
          # 1 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission] (From Machine 4)

        The
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          are
          fed
          on a tooled conveyor belt from machine 4. Here we pick 4 [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          and
          place
          them onto the [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].

        


        Station
          # 2 - Check Parts Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 3 -[Subject to a request for confidential treatment; Separately filed
          with the
          Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station’s
          4 to 6 - Free Stations

        


        Station
          # 7 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission](From Machine 2)

        
           

          
            	
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                      Europe Automation SA

                  	
                    Page
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        The
          [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]are
          fed
          on a tooled conveyor belt from machine 2. Here we pick 4 [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          and
          place
          them on top the [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].

        


        Station
          # 8 - Check Parts Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 9 -[Subject to a request for confidential treatment; Separately filed
          with the
          Commission]

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station’s
          10 to 16 - Free Stations

        


        Station’s
          17 to 20 - [Subject to a request for confidential treatment; Separately
          filed
          with the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        What
          we have just achieved

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 21 - Free Station

        


        Station’s
          22 to 25 - [Subject to a request for confidential treatment; Separately
          filed
          with the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station’s
          26 to 28 - Free Stations

        


        Station
          # 29 - Reject FAILED Parts (Extra Care Taken)

        Failed
          parts are rejected here; parts are picked then placed into separate reject
          bins.
[Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

         

        Station
          # 30 -Offload GOOD Assembled Products onto a Conveyor (Into Machine
          5b)

        Here
          we
          offload onto a tooled conveyor the core assembly and [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].
          This


        
           

          
            	
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                      Europe Automation SA

                  	
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        conveyor
          drives the assemblies forward into the [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].

         

        Station
          # 31 - Free Station

        


        Station
          # 32 - Check and Clean Empty Nests

        Here
          we
          check to ensure the nests are empty and indeed by using a vacuum manifold
          we
          clean the nests of any debris.

        


        


        Machine
          5b

        Station
          # 1 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 2 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 3 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 4 - Vision Inspect Label

        Using
          a
          vision system [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          we
          check
          that the label is present and indeed check that its details are
          correct.

        


        Station
          # 5 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 6 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 7 - Free Station

        


        Station
          # 8 - Free Station

        


        Station
          # 9 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        Station
          # 10 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

        


        Station’s
          11 to 16 - Free Stations

        


        Station
          # 17 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission](From Machine 5a)

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 18 - Check Parts Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 19 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 20 - Check Part Presence

        Here
          we
          check the position and presence of the parts.

        


        Station
          # 21 - [Subject to a request for confidential treatment; Separately filed
          with
          the Commission]

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 22 - Check Heights

        Here
          we
          check the heights of the final assembled products.

        


        Et
          voila - The final assembled product

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        The
          Final Tested Assembled Product

        


        


        Station
          # 23 - Free Station

        


        Station
          # 24 - Reject of Failed Parts / Check Station or Audit Station
          (Option)

        Failed
          parts are rejected here; parts are picked then placed into separate reject
          bins.
[Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Station
          # 25 -Offload GOOD Assembled Final Product onto a Conveyor (Into Packaging
          Machine)

        
           

          
            	
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                      Europe Automation SA

                  	
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        Here
          we
          offload onto a tooled conveyor the final products. This conveyor drives
          the
          assemblies forward into the packaging machine.

         

        Station’s
          26 to 31 - Free Stations

        


        Station
          # 32 - Check and Clean Empty Nests

        Here
          we
          check to ensure the nests are empty [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      26/43 

                  


          



        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            

            Annex
              1 to Purchase Agreement

          

        

      

       

      

        Packaging
          Machine

        Ismeca
          have worked with several packaging suppliers in the past for various different
          packaging requirements, your request is to put the final assembled product
          into
          a [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].
          To do
          this we need to use [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          separate
          suppliers with Ismeca to undertake full integration / interfacing / project
          management for all.

        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Ismeca
          will interface and control product flow with the aid of conveyors between
          machines, something Ismeca has made several times before. The complete
          packaging
          module has been priced as an option.

        


        


        Operators
          Required to Run this Line

        We
          estimate that [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          operators
          will be required to run our fully automatic production line (excluding
          part
          supplies).

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

         

        
          	4.  	
                  CONTROLS

                


        

         

         

        


         

        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        Each
          machine is considered as a standalone unit. The selected [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          is
          [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].
          Communication between the [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          and
          the
[Subject
          to a request for confidential treatment; Separately filed with the Commission]
          is
          made
          through a [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          The
          program is based on a [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].
          

        


        The
          software documentation structure is created [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].
          Each
          machine has its’ own set of documentation including [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].

        


        Ismeca
          has vast large experience with using [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          on
          large
          projects such as this.

      

      
         

        
          	
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                    Septmber 2005

                	
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                    Europe Automation SA

                	
                  Page
                    28/43 

                


        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          

          Annex
            1 to Purchase Agreement

        

      

       

      

         

        
          	5.  	
                  [SUBJECT
                    TO A REQUEST FOR CONFIDENTIAL TREATMENT; SEPARATELY FILED WITH
                    THE
                    COMMISSION] (HMI)

                


        

         

        


        The
          [Subject
          to a request for confidential treatment; Separately filed with the Commission]
          (HMI)
          will be implemented using an [Subject
          to a request for confidential treatment; Separately filed with the
          Commission].
          It
          offers a user-friendly means of communicating with the machine through
          menus.

        


        


        


        [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

        


        


        In
          addition to the HMI, the machine will include external operator buttons
          (start,
          stop, breakdown, open doors) and a status light tree.

        


        

           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      29/43 

                  


          

        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          

          Annex
            1 to Purchase Agreement

        

      

       

      

         

        
          	5.1.  	
                  STATISTICS

                


        

         

        


        The
          following set of statistics is visible in our standard
          configuration:

        


         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]:

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

         

        
          	 	
                  [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission]

                


        

         

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      30/43 

                  


          



        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            

            Annex
              1 to Purchase Agreement

          

        

      

       

      

        In
          addition to the HMI, the machine will include external operator buttons
          and a
          status light tree.

        


        


         

        
          	5.2.  	
                  ELECTRICAL

                


        

         

        


        The
          machine has a stand alone electrical cabinet which includes power and control
          voltage distribution, the programmable controller, safety circuitry, and
          all
          motor drivers. The cabinet is constructed using modular elements and
          incorporates a blower for ventilation. High voltage lines are kept separate
          from
          24V control circuits and a minimum of 20% space is reserved for future
          expansion. An aerial cable tray links the cabinet to the main machine.
          

        


        
           

          
 

        

        
          
             

            
              	
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                        Septmber 2005

                    	
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                        Europe Automation SA

                    	
                      Page
                        31/43 

                    


            

            
            

          

          
            
            

            
              

            

          

          
            
            

            

            Annex
              1 to Purchase Agreement

          

        

      

      

         

        
          	5.3.  	
                  ISMECA
                    STANDARDS

                


        

         

        In
          order
          to satisfy all applicable norms, (machine directives 98/37/CE, 89/336/CEE
          and
          73/23/CEE), our standard system configuration includes:

         

         

        
          	l 	
                  Emergency
                    Stop switches and door wiring per EN60204


                


        

         

         

        
          	l 	
                  Control
                    circuits wired with redundant relays


                


        

         

         

        
          	l 	
                  Shielded
                    connections for high voltage wiring

                


        

         

         

        
          	l 	
                  Shielded
                    motor cables

                


        

         

         

        
          	l 	
                  Global
                    EMC filtering used at the system
                    entry

                


        

         

         

        
          	l 	
                  Local
                    EMC filtering used at each motor
                    driver

                


        

         

         

        
          	l 	
                  24VDC
                    used on all control circuits

                


        

         

         

        
          	5.4.  	
                  Line
                    multi machine

                


        

         

        


        Each
          Machine PLC is connected by Ethernet to a collection PC (data collector)
          to be
          able to reach your part tracking requirements (Chapter 3.0 of your Product
          Design RFQ). Each part must be identified by a unique code which will be
          read on
          each machine. (2D Matrix or barcode)

        


        The
          final
          specification must define the data storage requirements on the main PC.
          The
          collection PC so far is not part of the price and scope of this Agreement.
          However, part tracking data, to be collected by each machine, is included
          in the
          price and scope of this Agreement.

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      32/43 

                  


          



        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            

            Annex
              1 to Purchase Agreement

          

        

      

      

         

        
          	6.  	
                  WORKING
                    ENVIRONMENT

                


        

         

        The
          equipment is designed to operate in the following environment:

         

         

        
          	l 	
                  Compressed
                    air, non - lubricated: 5 bars minimum, 4-5 m3/h
                    requirement. 

                


        

         

         

        
          	l 	
                  Electrical
                    power: 415VAC +/- 5%, 3P+N, 50Hz, 10-20 Amps
                    estimated.

                


        

         

         

        
          	l 	
                  Ambient
                    temperature: 20 ̊ +/- 2 ̊ C.

                


        

         

         

        
          	l 	
                  Relative
                    humidity: 50% =/- 10%,
                    non-condensing.

                


        

         

         

        
          	l 	
                  Machine
                    size is approx: 31.70Mtrs x 25.60
                    Mtrs.

                


        

         

         

        (Potentially
          smaller after further discussions) 

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      33/43 

                  


          

        

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            

            Annex
              1 to Purchase Agreement

          

        

         

        

           

          
            	7.  	
                    SCOPE
                      OF WORK
                      AND DELIVERABLES

                  


          

           

          The
            following items (except 2 below) are within the scope of this Agreement
            and are
            included in the price set forth herein:

           

          
            	1  	
                    It
                      is Ismeca’s standard policy to conduct bi-weekly project review meetings
                      with Customers. The location will be determined dependant upon
                      project
                      progress or possibly carried out via telephone or video conference.
                      

                  


          

           

           

          
            	2  	
                    Ismeca
                      undertakes installation and commissioning at the Customer's
                      premises
                      (Celestica) or those premises directed to.  Seller currently
                      estimates a 20 day process for that
                      purpose.

                  


          

           

           

          
            	3  	
                    FMEA’s
                      of the Ismeca equipment are part of standard Ismeca project
                      management and
                      therefore are included.

                  


          

           

           

          
            	4  	
                    A
                      pre-acceptance run (FAT) for your product is foreseen and is
                      made together
                      with our Ismeca Quality Assurance Group. It is foreseen to
                      do an 8 hour
                      production run.

                  


          

           

           

          
            	5  	
                    The
                      equipment complies with EC standards of safety, electromagnetic
                      compatibility and low voltage. 24Volt DC control sensors are
                      used.

                  


          

           

           

          
            	6  	
                    It
                      is foreseen that with a mechanical adjustment the inhibiting
                      or disabling
                      of stations will be possible.

                  


          

           

           

          
            	7  	
                    The
                      Following is a current list of the deliverable items under
                      this
                      Agreement:

                  


          

           

           

          
            	7.1  	
                    Training
                      of Customer’s personnel and its contractor’s personnel. This is performed
                      prior to and during the acceptance period at Seller’s premises. Additional
                      training can occur during and after installation (if needed)
                      also at the
                      contractor’s premises after final acceptance. A training plan will be
                      decided at the FMEA stage.

                  


          

           

           

          
            	7.2  	
                    The
                      Equipment and an initial lay in of spare parts (spare parts
                      are TBD and
                      not yet priced).

                  


          

           

           

          
            	7.3  	
                    Documentation,
                      including hard copies in adequate numbers and pc readable soft
                      copies,
                      which include the following:

                  


          

           

           

          7.3.1  Drawings
            of wear parts are provided in .dwg or .dxf format files and/or
            hardcopies

           

           

          7.3.2  Electric
            schematics are provided in CADELEC format files and/or hardcopies

           

           

          7.3.3  
            User
            manuals and maintenance manuals are delivered with the machine in quantities
            to
            be agreed. 

           

           

          7.3.4  An
            Ismeca
            standard statistics package is included in the machines cost.

           

           

          7.3.5  The
            following list of additional documents:

           

          
             

            
              	
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                        Septmber 2005

                    	
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                        Europe Automation SA

                    	
                      Page
                        34/43 

                    


            

          

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

              

              Annex
                1 to Purchase Agreement

            

          

        

      

       

      
         

        
          	 	
                  1.

                	
                  BOM
                    (Bill of material) listing every part of the line and referencing
                    drawing
                    number if a custom part and OEM number if its a purchased part.
                    

                


        

         

        
          	 	
                  2.
                    

                	
                  Mechanical
                    Assembly drawings. 

                


        

         

        
          	 	
                  3.
                    

                	
                  Detailed
                    Mechanical part drawings. 

                


        

         

        
          	 	
                  4.
                    

                	
                  Station
                    Electrical and Pneumatic Schematics.


                


        

         

        
          	 	
                  5.
                    

                	
                  Base
                     Electrical and Pneumatic Schematics.


                


        

         

        
          	 	
                  6.
                    

                	
                  Operating
                    Manuals. 

                


        

         

        
          	 	
                  7.
                    

                	
                  Maintenance
                    Manuals. 

                


        

         

        
          	 	
                  8.
                    

                	
                  OEM
                    manuals : For example where Ismeca may purchase equipment from
                    [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission] or
                    [Subject
                    to a request for confidential treatment; Separately filed with
                    the
                    Commission] they
                    must ensure that documentation is complete and pass on with the
                    overall
                    system. 

                


        

         

        
          	 	
                  9.
                    

                	
                  Copy
                    of PLC codes, Motion Controller programs, Vision System Codes
                    and test
                    system codes. 

                


        

         

        
          	 	
                  10.
                    

                	
                  Specification
                    for services detailing what vacuum, air, power, ventilation/Extraction
                    requirements per module and supply layout with detail of module
                    layout and
                    positions for service Drops. 

                


        

         

        
          	 	
                  11.
                    

                	
                  FMEA
                    Output. 

                


        

         

        
          	 	
                  12.
                    

                	
                  Buyoff
                     Reports

                


        

         

         

        
          	8  	
                  It
                    is understood by the Parties that there are a number of changes
                    that will
                    occur prior to the final freezing of the Specification and Equipment
                    definition. Appropriate and fair cost and schedule adjustments
                    will be
                    made (increase or decrease, as the case may be) by mutual agreement
                    of the
                    Parties in writing where the changes are significant. Ismeca
                    will generate
                    all proposals to the best possible detail level with the information
                    given
                    to include engineering time, design time and material costs,
                    etc. After
                    customer approval Ismeca reserves the right to make ‘change amendments’
                    after the successful completion of the FMEA.


                


        

         

        Components
          required for equipment test

         

         

        The
          Customer will supply Ismeca, free of charge, at the dates requested and
          in the
          quantities defined by the constructor, with the components necessary for
          equipment adjustment and buy-off.

         

         

        The
          components supplied will conform to the drawings in every respect and be
          of good
          quality.

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      35/43 

                  


          

        

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            

            Annex
              1 to Purchase Agreement

          

        

      

       

      
         

        
          	8.  	
                  PRICE
                    AND DELIVERY

                


        

         

        The
          price
          of the equipment described in this Annex 1 (IN SWISS FRANCS): 

         

        
          	 	For Machine 1 	CHF * 	 
	 	 	 	 
	 	For Machine 2 	CHF * 	 
	 	 	 	 
	 	For Machine 3 	CHF * 	 
	 	 	 	 
	 	For Machine 3 * 	CHF * 	 
	 	 	 	 
	 	For Machine 4  	CHF * 	 
	 	 	 	 
	 	For Machine 4 * 	CHF * 	 
	 	 	 	 
	 	For Machine 5 	CHF * 	 
	 	 	 	 
	 	Machine buffers / interface 	CHF * 	 
	 	 	 	 
	 	*
                  machine 	CHF * 	 
	 	 	 	 
	 	*
                  machine 	CHF * 	 
	 	 	 	 
	 	Packaging Line 	CHF * 	 
	 	 	 	 
	 	Line Supervision for machines 	 	* 
	 	 	 	 
	 	Line Supervision on PC 	CHF 	TBD 
	 	 	 	 
	 	Line total 	CHF 14’069’300 	 
	 	 	 	 
	 	Approx. Cost for line #2
                  (TBC) 	CHF 11’800’000 	 


        

         

         

        * [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

         

         

        
          	8.1.  	
                  DELIVERY TIME

                


        

         

         

        Delivery
          of the complete line will depend upon the availability of final and firm
          information on component designs and on the processes needed for assembly
          and
          test. Following our meeting in Switzerland and the estimates made at that
          time
          we have prepared an aggressive schedule which has line acceptance on December
          15
          2006, this based upon the firm order for this equipment being placed during
          the
          second week in September, 2005. 

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      36/43 

                  


          

        

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            

            Annex
              1 to Purchase Agreement

          

        

      

       

      
        
          	8.2.  	
                  INTENTIONALLY
                    LEFT BLANK

                


        

         

        
          	8.3.  	
                  WARRANTY

                


        

         

        The
          warranty is 12 months unlimited hours. The warranty period starts after
          completion of the Site Acceptance Test. Based in the UK we have a Customer
          Field
          Service Department. It is also Ismeca’s policy that ALL European Customer Field
          Engineers also speak English. Ismeca’s norm is to provide telephone assistance
          within 24hrs. With a maximum of 48hr. on-site service - our goal is to
          be
          faster. 

         

        
          	8.4.  	
                  MAINTENANCE
                    CONTACT

                


        

         

        Routine
          Maintenance Contracts can be proposed on request. (As per option 7 above)
          Included in such contracts Ismeca can offer regular routine maintenance
          visits
          to assist with machine maintenance and machine on-going training. 

         

        
          	8.5.  	
                  TRAINING OF
                    YOUR PERSONNEL

                


        

         

        Training
          of customer’s personnel is included in this Annex 1 and is carried out during
          machine acceptance, both in Ismeca and on the premises of that disclosed
          by the
          customer. A training plan will be discussed during the FMEA and agreed
          between
          both parties.

         

        
          	8.6.  	
                   INSTALLATION
                    AND COMMISSIONING

                


        

         

        Ismeca
          undertakes machine installation and commissioning on your premises in Ireland.
          We plan to have sufficient persons for a period of time not to exceed 20
          days.
          As option above TBC.

         

        
          	8.7.  	
                  CONFIDENTIALITY

                


        

         

         

        Each
          party undertakes to treat the information exchanged as
          confidential.

        
           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      37/43 

                  


          

        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          

          Annex
            1 to Purchase Agreement

        

      

       

      
        
          	9.  	
                  APPENDIX
                    PACK

                


        

         

         

        
          	Full line machine layout
                  drawing 	050604.100.B 	2D 
	 	 	 
	Machine layout drawing for machine
                  1 	050604.200.B 	2D 
	 	 	 
	Machine layout drawing for machine
                  2 	050604.300.B 	2D 
	 	 	 
	Machine layout drawing for machine
                  3  	050604.400.B 	2D 
	 	 	 
	Machine layout drawing for machine
                  4 	050604.500.B 	2D 
	 	 	 
	Machine layout drawing for machine
                  5 	050606.000.A 	2D 
	 	 	 
	Machine layout drawing for packaging
                  line 	050606.100.A 	2D 
	 	 	 
	Machine layout for * 	050606.100.A 	2D 
	 	 	 
	Machine layout drawing for * 	050515.000.A  	2D 


        

         

         

        __________

         

         

        * [Subject
          to a request for confidential treatment; Separately filed with the
          Commission]

         

         

        For
          and
          on behalf of

        Ismeca
          Europe Automation SA

         

         

        
          	 	 
	
                   

                  Serge
                    Peguiron

                   

                  Chief
                    Executive Officer

                   

                	
                   

                  Erik
                    Poulsen

                   

                  Director
                    Sales & Marketing

                


        

         

        
           

          
            	
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                      Septmber 2005

                  	
                    Ismeca
                      Europe Automation SA

                  	
                    Page
                      83/43 

                  


          

        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          

          Annex
            1 to Purchase Agreement

        

      

       

      
         

        
          	10.  	
                  CONTACTS

                


        

         

        


        More
          Energy 

        


        Gennadi
          Finkelshtain 

        General
          Manager

        


        2
          Yodfat
          Street

        Global
          Park

        PO
          Box
          1112

        Lod
          71291

        Israel

        Phone:
          +972-8-9188650

        Mobile. +972
          -54-441343

        Fax.
           +972
          8
          9152000

        Email. more@medisel.co.il

        


        


        Celestica
          Ireland 

        


        John
          Kennedy

        Device
          Engineer

        


        Celestica
          Ireland

        Parkmore
          Business Park West

        Ballybrit

        Galway

        Ireland

        Tel. +353
          (0)91 705000

        Fax.
           +353
          (0)91 705001

        Email. jkenned@celestica.com

        


        


        John
          Elwood

        General
          Manager

        


        Celestica
          Ireland

        Parkmore
          Business Park West

        Ballybrit

        Galway

        Ireland

        Tel. +353
          (0)91 705000

        Fax.
           +353
          (0)91 705001

        Ema

      

      
         

        
          	
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                    Septmber 2005

                	
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                    Europe Automation SA

                	
                  Page
                    39/43 

                


        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          

          Annex
            1 to Purchase Agreement

        

      

       

      

        Ismeca
          Europe Automation SA

        


        Jean-Paul
          Boillon

        Director,
          Engineering

        


        Ismeca
          Europe Automation

        283,
          rue
          de l'Helvétie

        CH-2301
          La Chaux-de-Fonds

        Switzerland

        Tel. +41
          (0)32
          9 257 111 

        Fax.
           +41
          (0)32
          9 257 575

        Email. jpboillon@ismeca.com
          

        


        


        


        Serge
          Peguiron

        CEO

        


        Ismeca
          Europe Automation

        283,
          rue
          de l'Helvétie

        CH-2301
          La Chaux-de-Fonds

        Switzerland

        Tel. +41
          (0)32
          9 257 111 

        Fax.
           +41
          (0)32
          9 257 115

        Email. speguiron@ismeca.com
          

        


        


         

        General
          Conditions of Sale and Delivery, 

        


        


        
          	
                  1.
                    

                	
                  Scope
                    of application 

                


        

        


        
          	 	
                  The
                    following terms are in addition to the terms set forth in the
                    main body of
                    the Purchase Agreement. In the event of a contradiction the terms
                    in the
                    main body of the Purchase Agreement shall control.
                    

                


        

        


        
          	
                  2.
                    

                	
                  Conclusion
                    of contract - written form


                


        

        


        
          	 	
                  Any
                    declaration or act made or performed by the Parties and having
                    a legal
                    effect shall be made in writing. 

                


        

        


        
          	
                  3.
                    

                	
                  Intentionally
                    Left Blank 

                


        

        


        
          	
                  4.

                	
                  Computer
                    programs necessary for the use of the Product
                    

                


        

        


        Where
          the
          use of the Product by the Customer involves the use of computer programs
          (source
          or other programs), hereinafter called the Programs,
          provided by 

        
           

          
            	
                    15th
                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
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            Annex
              1 to Purchase Agreement

          

        

      

       

      

        Ismeca
          with the Product or after its delivery, the Customer and any contractor
          or
          vendor to the Customer shall be granted a perpetual simple
          user licence, hereinafter called the Licence,
          limited and bound to that Product alone;
          the use
          of the Programs for other purposes or by third parties shall be forbidden
          save
          with the prior written agreement of Ismeca. 

        


        
          	 	
                  Should
                    the Customer resell the Product to a third party, the Licence
                    shall
                    

                


        

        automatically
          be transferred to that party on the same conditions, and so forth thereafter.
          

        


        
          	
                  5.

                	
                  Intentionally
                    Left Blank 

                


        

         

        
          	6.	
                  Intentionally
                    Left Blank

                


        

         

        
          	
                  7.

                	
                  Making
                    available to Ismeca the Components necessary for testing the
                    Product
                    

                


        

        


        
          	 	
                  The
                    Customer shall, on the dates and in the quantities defined in
                    the
                    

                


        

        Confirmation,
          make available to Ismeca the Components necessary to perform the Acceptance
          Tests on the Product; the Components provided should in all respects comply
          with
          the drawings and be of regular quality. 

        


        
          	 	
                  The
                    Customer shall be liable for the consequences of any delays,
                    insufficient

                


        

        quantities
          or non-standard or irregular quality Components. 

         

        
          	8.	
                  Intentionally
                    Left Blank 

                


        

         

        
          	
                  9.

                	
                  Intentionally
                    Left Blank

                


        

        


        
          	10.	
                  Intentionally
                    Left Blank 

                


        

         

        
          	
                  11.

                	
                  Intentionally
                    Left Blank

                


        

         

        
          	12.	
                  Intentionally
                    Left Blank

                


        

         

        
          	
                  13.

                	
                  Transfer
                    of Title and Risks and
                    Benefits

                


        

        


        The
          transfer of title, risks and benefits to the Equipment to the Customer
          shall
          occur as soon as Ismeca places the Product in the possession of the carrier
          in
          the premises of Ismeca after successful completion of the Acceptance Tests
          as
          evidenced by a Certificate of Milestone Completion signed by Customer and
          Seller.

         

        Upon
          receipt of the Product, the Customer alone shall be responsible for unpacking
          it and ensuring that it be appropriately stored at its place of destination.
          

         

        
          	
                  14.

                	
                  Transport,
                    insurance and packing 

                


        

        

           

          
            	
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                      Septmber 2005

                  	
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                      Europe Automation SA

                  	
                    Page
                      41/43 

                  


          

        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          

          Annex
            1 to Purchase Agreement

        

      

       

      
        Transport
          and insurance shall be at the risk and cost of the Customer. Other than
          for
          standard machines, the Customer shall also pay the packaging costs.

         

        Unless
          otherwise indicated by the Customer, but at the Customer's cost, Ismeca
          shall,
          in consultation with Customer, select the carrier, the mode of transport
          and the
          packing and it shall, likewise at the Customer's cost, have the Product
          covered
          by an insurer of its choice against the usual transport risks.

         

        The
          packing materials are not returnable. 

         

        
          	
                  15.

                	
                  Technical
                    support of the Customer by Ismeca


                


        

        


        Except
          for the training and technical assistance included in the scope of this
          Annex,
          the cost of technical Customer support and the training of its staff, as
          provided by Ismeca on the request of the Customer, will be invoiced to
          the
          Customer, be it in relation to the installation, start-up, use, maintenance,
          etc. of the Products, or provided subsequently. 

         

        
          	16.	
                  Intentionally
                    Left Blank

                


        

         

        
          	
                  17.

                	
                  Guarantee
                    

                


        

        


        Ismeca
          guarantees that the Equipment complies with its Specification and this
          Annex 1
          as both are modified from time to time by written agreement of the Customer
          and
          Seller and embodies no design, constructional, assembly or material defect
          and
          can be used under normal conditions, provided the indications in the Ismeca
          instruction file are followed and the prescribed maintenance is carried
          out. In
          this respect the design life of the Equipment is twenty (20) years.


        
           

            The
              length of the guarantee shall be 12 months from the acceptance of the
              Product,
              but no more than 15 months from when Ismeca makes the Product
available
              to the carrier, whichever the sooner. The length of the guarantee on
              Products
              either repaired or replaced by Ismeca under its guarantee shall be
              12
              months from the time of the repair or delivery. Parts suffering wear
              and tear
              shall form an exception and are not guaranteed unless otherwise mentioned
              in
              this Agreement. 

          

        

        
        

        
          
            At
              Ismeca's discretion, the Product or the defective component may be
              repaired or
              replaced free of charge under the guarantee. The defects must be such
              as to be
              identifiable to and reasonably accepted by Ismeca. 

          

        

        
        

        
          
            Unless
              the Customer lacks the technical capacity itself to perform the necessary
              work
              and if no suitable local technical support is available, Ismeca will
              have the
              choice of having the necessary repair work performed by its own staff
              in
              situ
              or
asking
              the Customer to have the work done at Ismeca's expense, or asking a 
              technical
              team to do it for the account and at the expense of Ismeca.


          

        

        


        All
          other
          claims are excluded, especially with regard to damages in respect of
direct
          or
          indirect damages, loss of production, lost earnings, etc., as is the possibility
          for the Customer to reduce or rescind the Order in question or any other
          order


      

      
         

        
          	
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                    Septmber 2005

                	
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                    Europe Automation SA

                	
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                    42/43 

                


        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          

          Annex
            1 to Purchase Agreement

        

      

       

      
        already
          confirmed. This exclusion does not apply to cases of grave misfeasance
          or wilful
          misconduct on the part of Ismeca. 

         

        The
          guarantee does not cover damage resulting from normal wear, improper
treatment,
          lack of maintenance, excessive use or failure to observe the instructions
          for use. 

         

        Any
          direct intervention, repair, modification or transformation performed on
          the
          Product or the Programs by the Customer or by a third party after the Product
          or
          the Programs leave Ismeca, without prior written permission from Ismeca,
          will
invalidate
          the Ismeca guarantee on the corresponding part of the Product or the Programs
          and will render any outstanding balance of payment immediately callable.
          

         

        
          	18.	
                  Intentionally
                    Left Blank 

                


        

         

        
          	
                  19.

                	
                  Intentionally
                    Left Blank 

                


        

         

        
          	
                  20.

                	
                  Invalidation
                    of a clause 

                


        

        


        If
          one or
          more of the terms of the present General Conditions should be or 

         

        become
          partially or completely invalid, the remainder of the present General Conditions
          shall remain entirely valid. The Parties shall consult on the invalidated
          term
          or terms to find a replacement solution whose legal and economic scope
          would be
          as close as possible to that of the term or terms invalidated. 

         

        
          	
                  21.

                	
                  Authentic
                    version 

                


        

        


        
          	 	
                  Only
                    the English version of the present General Conditions shall be
                    authentic.
                    

                


        

        


        
          	22.	
                  Intentionally
                    Left Blank

                


        

      

      
         

        
          	
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                    Septmber 2005

                	
                  Ismeca
                    Europe Automation SA

                	
                  Page
                    43/43 

                


        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          Annex
            1 to Purchase Agreement