Document:

PHOTOWATT

 

Exhibit
10.1

MASTER SEPARATION AGREEMENT

between

ATS AUTOMATION TOOLING SYSTEMS INC.

– and –

PHOTOWATT TECHNOLOGIES INC.

[     ],
2007

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	ARTICLE 1	 	DEFINITIONS
	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	 	1.1	 	 	Defined Terms
	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	 	1.2	 	 	Construction
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	1.3	 	 	Conflicts With Other Separation Agreements
	 	 	10	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 2	 	PHOTOWATT ASSETS AND LIABILITIES
	 	 	10	 
	 	 	 	 	 
	 	 	 	 
	 	2.1	 	 	Transfer of Photowatt Assets
	 	 	10	 
	 	 	 	 	 
	 	 	 	 
	 	2.2	 	 	Non-Transferred Assets
	 	 	10	 
	 	 	 	 	 
	 	 	 	 
	 	2.3	 	 	No Representations or Warranties
	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	 	2.4	 	 	Assumption of Photowatt Liabilities
	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 3	 	THE OFFERING
	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	 	3.1	 	 	Proceeds of the Offering
	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 4	 	MATTERS RELATING TO A SPIN-OFF
	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	 	4.1	 	 	Spin-Off
	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	 	4.2	 	 	Actions Prior to a Spin-Off
	 	 	12	 
	 	 	 	 	 
	 	 	 	 
	 	4.3	 	 	Stockholder-Related Matters Regarding a Spin-Off
	 	 	13	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 5	 	EMPLOYEE MATTERS AND NON-COMPETITION
	 	 	14	 
	 	 	 	 	 
	 	 	 	 
	 	5.1	 	 	Employee Matters
	 	 	14	 
	 	 	 	 	 
	 	 	 	 
	 	5.2	 	 	Non-Competition
	 	 	15	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 6	 	ACCESS TO AND DISCLOSURE OF INFORMATION
	 	 	15	 
	 	 	 	 	 
	 	 	 	 
	 	6.1	 	 	Restrictions on Disclosure of Information
	 	 	15	 
	 	 	 	 	 
	 	 	 	 
	 	6.2	 	 	Legally Required Disclosure of Information
	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	 	6.3	 	 	Access to Information
	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	 	6.4	 	 	Record Retention
	 	 	18	 
	 	 	 	 	 
	 	 	 	 
	 	6.5	 	 	Production of Witnesses
	 	 	18	 
	 	 	 	 	 
	 	 	 	 
	 	6.6	 	 	Reimbursement
	 	 	18	 
	 	 	 	 	 
	 	 	 	 
	 	6.7	 	 	Other Agreements Regarding Access to Information
	 	 	19	 
	 	 	 	 	 
	 	 	 	 
	 	6.8	 	 	Acquisition of Photowatt by Another Person
	 	 	19	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 7	 	ADDITIONAL COVENANTS
	 	 	19	 
	 	 	 	 	 
	 	 	 	 
	 	7.1	 	 	Further Assurances
	 	 	19	 

- i -

 

TABLE OF CONTENTS
(continued)

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	 	7.2	 	 	Performance
	 	 	20	 
	 	 	 	 	 
	 	 	 	 
	 	7.3	 	 	ATS Guarantees
	 	 	20	 
	 	 	 	 	 
	 	 	 	 
	 	7.4	 	 	TPC Contribution Agreement
	 	 	20	 
	 	 	 	 	 
	 	 	 	 
	 	7.5	 	 	Original Corporate Records
	 	 	21	 
	 	 	 	 	 
	 	 	 	 
	 	7.6	 	 	License of ATS Solar Automation Know-How
	 	 	21	 
	 	 	 	 	 
	 	 	 	 
	 	7.7	 	 	Legal and Regulatory Matters
	 	 	23	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 8	 	MUTUAL RELEASES; INDEMNIFICATION
	 	 	24	 
	 	 	 	 	 
	 	 	 	 
	 	8.1	 	 	Release of Pre-Closing Claims
	 	 	24	 
	 	 	 	 	 
	 	 	 	 
	 	8.2	 	 	Indemnification by Photowatt
	 	 	25	 
	 	 	 	 	 
	 	 	 	 
	 	8.3	 	 	Indemnification by ATS
	 	 	26	 
	 	 	 	 	 
	 	 	 	 
	 	8.4	 	 	Claim Procedure
	 	 	26	 
	 	 	 	 	 
	 	 	 	 
	 	8.5	 	 	Survival; Limitations
	 	 	28	 
	 	 	 	 	 
	 	 	 	 
	 	8.6	 	 	Production of Witnesses and Documents
	 	 	30	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 9	 	MISCELLANEOUS
	 	 	31	 
	 	 	 	 	 
	 	 	 	 
	 	9.1	 	 	Assignment
	 	 	31	 
	 	 	 	 	 
	 	 	 	 
	 	9.2	 	 	Entire Agreement
	 	 	31	 
	 	 	 	 	 
	 	 	 	 
	 	9.3	 	 	No Agency
	 	 	31	 
	 	 	 	 	 
	 	 	 	 
	 	9.4	 	 	Future Litigation and Other Proceedings
	 	 	32	 
	 	 	 	 	 
	 	 	 	 
	 	9.5	 	 	Further Assurances
	 	 	32	 
	 	 	 	 	 
	 	 	 	 
	 	9.6	 	 	Notices
	 	 	32	 
	 	 	 	 	 
	 	 	 	 
	 	9.7	 	 	Time of Essence
	 	 	33	 
	 	 	 	 	 
	 	 	 	 
	 	9.8	 	 	Governing Law
	 	 	33	 
	 	 	 	 	 
	 	 	 	 
	 	9.9	 	 	Severability
	 	 	33	 
	 	 	 	 	 
	 	 	 	 
	 	9.10	 	 	Force Majeure
	 	 	33	 
	 	 	 	 	 
	 	 	 	 
	 	9.11	 	 	Publicity
	 	 	34	 
	 	 	 	 	 
	 	 	 	 
	 	9.12	 	 	Specific Performance
	 	 	34	 
	 	 	 	 	 
	 	 	 	 
	 	9.13	 	 	Currency
	 	 	34	 
	 	 	 	 	 
	 	 	 	 
	 	9.14	 	 	Time Periods
	 	 	34	 
	 	 	 	 	 
	 	 	 	 
	 	9.15	 	 	Amendment
	 	 	34	 
	 	 	 	 	 
	 	 	 	 
	 	9.16	 	 	Counterparts
	 	 	34	 

- ii -

 

TABLE OF CONTENTS
(continued)

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page	 
	 	9.17	 	 	Authority
	 	 	34	 
	 	 	 	 	 
	 	 	 	 
	 	9.18	 	 	Jurisdiction
	 	 	34	 
	 	 	 	 	 
	 	 	 	 
	 	9.19	 	 	Dispute Resolution
	 	 	35	 
	 	 	 	 	 
	 	 	 	 
	 	9.20	 	 	Binding Effect
	 	 	38	 
	 	 	 	 	 
	 	 	 	 
	 	9.21	 	 	Expenses
	 	 	38	 
	 	 	 	 	 
	 	 	 	 
	 	9.22	 	 	Waiver
	 	 	38	 
	 	 	 	 	 
	 	 	 	 
	 	9.23	 	 	Compliance With Laws
	 	 	38	 

- iii -

 

MASTER SEPARATION AGREEMENT

     This
Master Separation Agreement (this “Agreement”) is
made and entered into as of [     ],
2007, by and between ATS Automation Tooling Systems Inc., a corporation governed by the laws of
Ontario (“ATS”), and Photowatt Technologies Inc., a corporation governed by the laws of Canada
(“Photowatt”). ATS and Photowatt are sometimes referred to herein separately as a “Party” and
together as the “Parties.”

RECITALS

	A.	 	[ATS owns, directly or indirectly, 100% of the issued and outstanding common shares of
Photowatt.]
	 

	B.	 	Photowatt is undertaking an initial public offering (the “Offering”) of its common shares
pursuant to a registration statement on Form F-1 under the U.S. Securities Act of 1933 and a
prospectus filed with Canadian Securities Regulatory Authorities (as defined below).

	 
	C.	 	Immediately prior to the completion of the Offering, ATS and Photowatt intend to enter into a
Master Separation Agreement (the “Master Separation Agreement”), containing the key provisions
relating to the separation of ATS and Photowatt, and the other Separation Agreements (as
defined in the Master Separation Agreement).

	 
	D.	 	Immediately following completion of the Offering, ATS will own, directly or indirectly
approximately [     ]% of the outstanding Photowatt Common Shares (as defined below).

	 
	E.	 	ATS and Photowatt desire to maintain the ability of ATS (if so determined by the ATS board of
directors) to distribute to holders of ATS Common Shares (as defined below) all or a portion
of the outstanding Photowatt common shares then owned by ATS (a “Spin-Off”).
	 
	F.	 	The Parties intend in this Agreement and the other Separation Agreements to set forth the
principal arrangements between them regarding the Offering and their operations thereafter.

AGREEMENT

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements set
forth below, and other good and valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the Parties hereby agree as follows:

ARTICLE 1

DEFINITIONS

1.1 Defined Terms. As used in this Agreement, the following terms shall have the following
meanings:

“ATS” is defined in the preamble to this Agreement.

- 1 -

 

“ATS Assets” means any and all Assets of the ATS Group or Photowatt Group as of the Separation Time
other than the Photowatt Assets.

“ATS Business” means the businesses or operations of the ATS Group excluding the Existing Photowatt
Business.

“ATS Common Shares” means the common shares in the capital of ATS.

“ATS Disclosure Portions” means all material set forth in the Registration Statement, the
Prospectus and the final Preliminary Prospectus to the extent relating exclusively to (i) the ATS
Group, excluding Automation Tooling Systems Enterprises, Inc. and Matrix Solar Technologies, Inc.
to the extent that the material relates to the Existing Photowatt Business or (ii) the ATS
Business.

“ATS Group” means ATS and each Person that ATS directly or indirectly controls (within the meaning
of the Ontario Securities Act), other than any member of the Photowatt Group.

“ATS Indemnified Persons” means each member of the ATS Group and its respective Representatives.

“ATS Liabilities” means the Liabilities of the ATS Group (but excludes all Photowatt Liabilities).

“ATS Products” means all products of the ATS Business.

“ATS Solar Automation Know-How” means all information, whether written or unwritten, existing as of
execution of this Agreement, relating to the Field of Use, that is: (i) known to ATS; or (ii)
intellectual property rights owned by ATS, but excluding any intellectual property rights owned by
ATS solely to the extent covered by any patent or application therefor owned by ATS as at the
Separation Time.

“Action” means any suit, arbitration, inquiry, proceeding or investigation by or before any court,
Governmental Authority or any arbitration tribunal asserted by a Person.

“Affiliate” of any specified Person means any other Person directly or indirectly “controlling,”
“controlled by” or “under common control with” (within the meaning of the Ontario Securities Act),
such specified Person; provided, however, that for purposes of the Separation
Agreements, except to the extent expressly provided otherwise, the determination of whether a
Person is an Affiliate of another Person shall be made assuming that no member of the ATS Group is
an Affiliate of any member of the Photowatt Group and vice versa.

“Agreement” is defined in the preamble to this Agreement.

“Amalco” is defined in Section 4.1(a).

“Annual Financial Statements” means (i) the consolidated annual financial statements of the
Photowatt Group (and notes thereto), including in comparative form the consolidated figures (and
notes thereto) for the previous fiscal year, all in reasonable detail and prepared in

- 2 -

 

accordance with Regulation S-X, Canadian Securities Laws, Canadian GAAP and all other applicable
Laws and in accordance with any similar or successor rule or Laws, and (ii) a discussion and
analysis by management of the Photowatt Group’s financial condition and results of operations for
such year, including an explanation of any material period-to-period change and any off-balance
sheet transactions, all in reasonable detail and prepared in accordance with Item 303(a) of
Regulation S-K and Canadian Securities Laws and in accordance with any similar or successor rule or
laws.

“Assets” means assets, properties and rights (including goodwill and rights arising under
Contracts), wherever located (including in the possession of vendors, other Persons or elsewhere),
whether real, personal or mixed, tangible, intangible or contingent, in each case whether or not
recorded or reflected or required to be recorded or reflected on the books and records or financial
statements of any Person.

“Business Day” means a day other than Saturday, Sunday or other day on which commercial banks in
Toronto, Ontario are authorized or required by Law to close.

“Business Guarantees” is defined in Section 7.3.

“Canadian GAAP” means those accounting principles which are recognized as being generally accepted
in Canada from time to time as set out in the Handbook published by the Canadian Institute of
Chartered Accountants, applied on a consistent basis.

“Canadian Securities Laws” means securities legislation established in each Province and Territory
of Canada, and all regulations, rules, blanket orders and policies established thereunder or issued
by Canadian Securities Regulatory Authorities.

“Canadian Securities Regulatory Authorities” is defined in Section 4.1(a).

“Claimed Amount” is defined in Section 8.4(a).

“Claim Notice” is defined in Section 8.4(a).

“Consents” means the consents of Persons referred to in the disclosure letter of even date
delivered by ATS to Photowatt and initialed by the Parties.

“Contract” means any contract, agreement, lease, license, sales order, purchase order, instrument
or other commitment that is binding on any Person or any part of its property under applicable Law.

“Controlling Party” is defined in Section 8.4(d)(ii).

“Designated Purposes” means the purpose or purposes for which any confidential Information or
Personal Information may be used by any Group member pursuant to this Agreement or any other
Separation Agreement and otherwise in accordance with any directions given by one Party to the
other Party in performance of services under the Transitional Services Agreement.

“Dispute” is defined in Section 9.19.

- 3 -

 

“Distribution Agent” is defined in Section 4.3(a).

“Environmental Conditions” means the presence in the environment, including the soil, subsurface
strata, groundwater, surface water or ambient air, of any Hazardous Material at a level which
exceeds any applicable standard or threshold under any Environmental Law or otherwise requires
investigation or remediation (including investigation, study, health or risk assessment,
monitoring, removal, treatment or transport) under any applicable Environmental Laws.

“Environmental Laws” means all Laws of any Governmental Authority with jurisdiction that relate to
the protection of the environment (including ambient air, surface water, ground water, land surface
or subsurface strata) including laws and regulations relating to a Hazardous Materials Release, or
otherwise relating to the import, storage, distribution, labelling, sale, use, treatment, disposal,
transport or handling of Hazardous Materials, or to the exposure of any individual to a Hazardous
Materials Release.

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.

“Excluded Assets” means the Assets referred to in Exhibit A.

“Existing Photowatt Business” means the solar and related businesses and operations conducted by
ATS prior to the Separation Time through its subsidiaries Photowatt International S.A.S.,
Automation Tooling Systems Enterprises, Inc., Matrix Solar Technologies, Inc., Photowatt
Technologies USA Inc. and Spheral Solar Power, Inc., as well as the Spheral Solar Division of ATS,
and including such businesses and operations of the Photowatt Group as described in the Prospectus.

“Field of Use” means the automation of one or more steps in the manufacturing of solar products,
including the design and manufacture of equipment used to automatically convey, grip, locate,
orient, connect, manipulate, alter, form, inspect, test or sense materials or products as part of a
manufacturing process and all processes embodied in such equipment or relating to the manufacturing
of solar products or the automation thereof.

“Financial Statements” means the Annual Financial Statements and Quarterly Financial Statements
collectively.

“Governmental Authority” means any federal, provincial, state, local or foreign government,
supranational, governmental, regulatory or administrative authority, instrumentality, agency or
commission, political subdivision, self-regulatory organization or any court, tribunal or judicial
or arbitral body or other governmental authority.

“Group” means either the ATS Group or the Photowatt Group, as the context requires.

“Hazardous Materials” means chemicals, pollutants, contaminants, hazardous substances, dangerous
substance, noxious substance, toxic substance, radioactive and biological materials, petroleum and
petroleum products or any fraction thereof, hazardous waste, flammable or explosive material,
radio-active material, urea formaldehyde foam insulation, asbestos, polychlorinated biphenyls,
polychlorinated biphenal waste, polychlorinated biphenal related

- 4 -

 

waste or any other substance or material now or hereafter declared, defined or deemed to be
regulated or controlled in or pursuant to Environmental Laws.

“Hazardous Materials Release” means any release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching or migration into the indoor or outdoor
environment, including the movement of Hazardous Materials through ambient air, soil, surface
water, groundwater, wetlands, land or subsurface strata.

“Included Liabilities” means the Liabilities referred to in Exhibit B.

“Indemnified Party” is defined in Section 8.4(a).

“Indemnified Person” means, as applicable, a Photowatt Indemnified Person or an ATS Indemnified
Person.

“Indemnifying Party” is defined in Section 8.4(a).

“Information” means information, whether or not patentable or copyrightable, in written, oral,
electronic or other tangible or intangible forms, that may be stored in any medium, including
studies, reports, records, books, contracts, instruments, surveys, discoveries, ideas, concepts,
know-how, techniques, designs, specifications, drawings, blueprints, diagrams, models, prototypes,
samples, flow charts, data, computer data, disks, diskettes, tapes, computer programs or other
software, marketing plans, customer names, communications by or to attorneys (including
attorney-client privileged communications), memoranda and other materials prepared by attorneys or
under their direction (including attorney work product), and other technical, financial, employee
or business information or data.

“Law” means any law (statutory, common or otherwise), constitution, ordinance, code, rule,
regulation, guideline, executive order or other similar authority enacted, adopted, promulgated or
applied by any Governmental Authority, each as amended.

“Lease Agreement” means the Lease Agreement in the form set out in Exhibit D.

“Liability” means any liability, obligation, cost or expense, whether known or unknown, asserted or
unasserted, fixed, absolute or contingent, matured or unmatured, conditional or unconditional,
latent or patent, accrued or unaccrued, liquidated or unliquidated or due or to become due,
wherever or however arising (including whether arising out of any Law, Contract or tort based on
negligence or strict liability), including but not limited to, any tax liability.

“Losses” means all damages, losses, Liabilities, payments, amounts paid in settlement, obligations,
fines, penalties, costs of burdens associated with performing injunctive relief and other costs
(including reasonable fees and expenses of outside attorneys, accountants and other professional
advisors, and of expert witnesses and other costs (excluding the allocable portion of the relevant
Person’s internal costs) of investigation, preparation and litigation in connection with any
action, appeal, petition, plea, charge, complaint, claim, suit, demand, litigation, arbitration,
mediation, hearing, inquiry, investigation or similar matter or proceeding) of any kind or nature
whatsoever, whether known or unknown, contingent or vested, or matured or unmatured.

- 5 -

 

“Master Supply Agreement” means the Master Supply Agreement in the form set out in Exhibit
E.

“Non-Controlling Party” is defined in Section 8.4(d)(ii).

“Non-Transferred Asset” is defined in Section 2.2(a).

“Offering” is defined in the recitals to this Agreement.

“Ontario Securities Act” means the Securities Act (Ontario).

“Owning Party” is defined in Section 6.2.

“Person” means any individual, partnership, limited partnership, limited or unlimited liability
company, joint venture, syndicate, sole proprietorship, company or corporation with or without
share capital, unincorporated association, unincorporated syndicate, unincorporated organization,
trust, trustee, executor, administrator or other legal personal representative or Governmental
Authority however designated or constituted.

“Personal Information” means any information about an identifiable individual that is provided to
or obtained by any Group member on behalf of the other Party or any of its respective Group
members.

“Photowatt” is defined in the preamble to this Agreement.

“Photowatt Assets” means any and all Assets that are used exclusively or held for use exclusively
in the Existing Photowatt Business excluding the Excluded Assets.

“Photowatt Business” means the businesses and operations conducted by the Photowatt Group at the
relevant time.

“Photowatt Common Shares” means the common shares in the capital of Photowatt, and include (i) any
shares of Photowatt into which such shares may be converted, reclassified, subdivided,
consolidated, exchanged or otherwise changed, whether pursuant to a reorganization, amalgamation,
merger, arrangement or other form of reorganization, and (ii) any securities of Photowatt
convertible into, exchangeable for or otherwise exercisable to acquire such shares.

“Photowatt Facilities” means the facilities located at each of 25 Reuter Drive, Cambridge, Ontario,
N3E 1A9; 33, rue Saint-Honore, Z.1 Champfleuri 38300 Bourgoin-Jallieu, France; 540 Silver Creek
Road N.W., Suite A, Albuquerque, New Mexico; and such other facilities, offices and locations from
which the business or operations of the Photowatt Business are conducted.

“Photowatt Group” means Photowatt and each Person that Photowatt directly or indirectly controls
(within the meaning of the Ontario Securities Act).

“Photowatt Indemnified Persons” means each member of the Photowatt Group and its respective
Representatives.

- 6 -

 

“Photowatt Liabilities” means the following:

	 	(i)	 	any and all Liabilities to the extent arising out of or relating to the
Existing Photowatt Business, the Photowatt Business or the Photowatt Assets, in each
case whether such Liabilities arise or accrue prior to, on or after the Separation
Time including:

	 	(A)	 	any and all Liabilities of any member of the Photowatt Group
owed to the ATS Group pursuant to valid intercompany accounts as of the
Separation Time and/or reflected in the financial statements contained in the
Prospectus or in any Annual Financial Statements or Quarterly Financial
Statements prepared after the Separation Time;
	 
	 	(B)	 	any and all Liabilities arising from or related to
Environmental Conditions (x) existing on, under, about or in the vicinity of
any of the Photowatt Facilities whether prior to or after the Separation Time,
or (y) arising out of operations occurring at any time prior to or after the
Separation Time of the Existing Photowatt Business, the Photowatt Business or
the Photowatt Assets, or at any of the Photowatt Facilities;
	 
	 	(C)	 	any and all employment-related Liabilities related to employees
of the Existing Photowatt Business and the Photowatt Business;
	 
	 	(D)	 	any and all Liabilities relating to, arising out of or
resulting from any act or failure to act by any Representative of any member of
the ATS Group, including Photowatt (whether or not such act or failure to act
is or was within such Person’s authority); and
	 
	 	(E)	 	any and all tax Liabilities relating to, arising out of or
resulting from the Existing Photowatt Business and the Photowatt Business;

	 	(ii)	 	any and all Liabilities to the extent arising out of or relating to the
operation of any business conducted by any member of the Photowatt Group at any time
after the Separation Time;
	 
	 	(iii)	 	any and all Liabilities that are expressly listed, scheduled or
otherwise clearly described in any other Separation Agreement as Liabilities for
which Photowatt or any member of the Photowatt Group is to be responsible, including
but not limited to, any Liabilities set out in Exhibit B as “Included
Liabilities”;
	 
	 	(iv)	 	any and all Business Guarantees that are not replaced with Substitute
Guarantees, or with respect to which ATS or any member of the ATS Group has any
liability or obligation after the Closing Date; and
	 
	 	(v)	 	any and all obligations of the Photowatt Group under or pursuant to this
Agreement, any Separation Agreement or any other instrument entered into in
connection herewith or therewith.

- 7 -

 

“Photowatt Transfer Agent” means the transfer agent and registrar for the Photowatt Common Shares.

“Possessor” is defined in Section 6.3.

“Preliminary Prospectus” means any preliminary prospectus filed with the SEC and deemed to be part
of the Registration Statement and filed with Canadian Securities Regulatory Authorities pursuant to
Canadian Securities Laws.

“Prospectus” means the final prospectus filed with the SEC and deemed to be part of the
Registration Statement and filed with Canadian Securities Regulatory Authorities pursuant to
Canadian Securities Laws.

“Quarterly Financial Statements” means (i) the consolidated quarterly financial statements of the
Photowatt Group (and notes thereto), including in comparative form the consolidated figures (and
notes thereto) for the corresponding quarter and periods of the previous fiscal year, all in
reasonable detail and prepared in accordance with Article 10 of Regulation S-X, Canadian Securities
Laws, Canadian GAAP and all other applicable Laws and in accordance with any similar or successor
rule or laws, and (ii) a discussion and analysis by management of the Photowatt Group’s financial
condition and results of operations for such fiscal period, including an explanation of any
material period-to-period change and any off-balance sheet transactions, all in reasonable detail
and prepared in accordance with Item 303(b) of Regulation S-K and Canadian Securities Laws and in
accordance with any similar or successor rule or laws.

“Record Date” means the close of business on the date to be determined by ATS board of directors as
the record date for determining the shareholders of ATS entitled to receive Photowatt Common Shares
pursuant to a Spin-Off.

“Registration Rights Agreement” means the Registration Rights Agreement in the form set out in
Exhibit F.

“Registration Statement” means the registration statement on Form F-1 (SEC File No. 333-137044) as
filed by Photowatt with the SEC in connection with the Offering, together with all amendments and
supplements thereto.

“Regulation S-K” means Regulation S-K of the General Rules and Regulations promulgated by the SEC
pursuant to the U.S. Securities Act.

“Regulation S-X” means Regulation S-X of the General Rules and Regulations promulgated by the SEC
pursuant to the U.S. Securities Act.

“Representatives” means, with respect to any Person, any of such Person’s directors, officers,
employees, consultants, advisers and agents.

“Requestor” is defined in Section 6.3.

“Retention Period” is defined in Section 6.4.

- 8 -

 

“SEC” means the United States Securities and Exchange Commission or any successor agency.

“Separation Agreements” means this Agreement, the Transfer Agreements, the Lease Agreement, the
Registration Rights Agreement, the Shareholder Agreement, the Master Supply Agreement and the
Transitional Services Agreement.

“Separation Time” means the time concurrent with the time of closing of the Offering and following
the delivery by ATS to Photowatt of a certificate of two officers of Photowatt that all conditions
precedent to completion of the Offering, other than the completion of the transactions contemplated
by the Separation Agreements to be completed on or prior to the Separation Time, have been
satisfied or waived.

“Shareholder Agreement” means the Shareholder Agreement in the form set out in Exhibit G.

“Substitute Guarantees” is defined in Section 7.3.

“Spin-Off” is defined in the recitals to this Agreement.

“Spin-Off Date” means the date, if any, on which a Spin-Off in respect of all Photowatt Common
Shares then held by ATS occurs or ATS is otherwise no longer required to consolidate, or account on
an equity basis for, the results of operations and financial position of Photowatt or any other
member of the Photowatt Group (determined in accordance with GAAP and consistent with SEC reporting
requirements and Canadian Securities Laws).

“Tax Benefit” means any deduction, amortization, exclusion from income or other allowance that
actually reduces in cash the amount of tax Photowatt or its respective Affiliates (as applicable)
would have been required to pay (or actually increases in cash the amount of tax refund to which
Photowatt or its respective Affiliates (as applicable) would have been entitled) in the absence of
the item giving rise to the indemnity claim.

“Third Party Claim” is defined in Section 8.4(d)(i).

“TPC Contribution Agreement” means TPC Agreement No. 731-477798 dated March 28, 2002, as amended by
an amendment agreement dated September 17, 2004, each between Her Majesty The Queen In Right Of
Canada, as represented by the Minister of Industry, and ATS.

“Transfer Agreements” means the Transfer Agreements in the form set out in Exhibit H.

“Transitional Services Agreement” means the Transitional Services Agreement in the form set out in
Exhibit I.

“U.S. Securities Act” means the U.S. Securities Act of 1933, as amended.

1.2 Construction. If an ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of
proof shall arise favouring or disfavouring any Party because of the authorship of any provision of
this Agreement. Any reference to any federal, state, provincial, local or foreign law shall be
deemed also to refer to such law as amended and all rules and regulations promulgated

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thereunder, unless the context requires otherwise. Any reference to any Contract (including
schedules, exhibits and other attachments thereto), including this Agreement, shall be deemed also
to refer to such Contract as amended, restated or otherwise modified, unless the context requires
otherwise. The words “include,” “includes” and “including” shall be deemed to be followed by
“without limitation.” Pronouns in masculine, feminine and neuter genders shall be construed to
include any other gender, and words in the singular form shall be construed to include the plural
and vice versa, unless the context requires otherwise. The words “this Agreement,” “herein,”
“hereof,” “hereby,” “hereunder” and words of similar import refer to this Agreement as a whole and
not to any particular subdivision unless expressly so limited. Where this Agreement states that a
Party “will” or “shall” perform in some manner or otherwise act or omit to act, it means that such
Party is legally obligated to do so in accordance with this Agreement. The word “or” shall not be
exclusive. The captions, titles and headings included in this Agreement are for convenience only
and do not affect this Agreement’s construction or interpretation. Any reference to an Article,
Section or Schedule in this Agreement shall refer to an Article or Section of, or Schedule to, this
Agreement, unless the context otherwise requires.

1.3 Conflicts With Other Separation Agreements. To the extent any portion of this
Agreement conflicts with any other Separation Agreement, this Agreement shall control.

ARTICLE 2

PHOTOWATT ASSETS AND LIABILITIES

2.1 Transfer of Photowatt Assets. In order to effect the transfer of the Photowatt Assets
by the ATS Group to the Photowatt Group on the terms contemplated by the Separation Agreements,
which transfers are to occur prior to or concurrent with completion of the Offering as contemplated
by the Separation Agreements, each Party will enter into the Separation Agreements other than this
Agreement at the Separation Time.

2.2 Non-Transferred Assets.

	 	(a)	 	If any Party discovers after the Separation Time that a member of the ATS Group
has title to, or an interest in, a Photowatt Asset or a member of the Photowatt Group
has title to, or an interest in, an ATS Asset (in either case, a “Non-Transferred
Asset”), each Party shall (and shall cause the applicable member(s) of its Group to)
cooperate and use commercially reasonable efforts to promptly transfer such title or
interest to the appropriate Party (or another member of its Group designated by it),
including obtaining any necessary consents or approvals or taking any other actions
necessary to effect such transfers.
	 
	 	(b)	 	If an attempted assignment of a Non-Transferred Asset would be ineffective or
would impair the rights of the Party entitled to such asset with respect to such
Non-Transferred Asset so that such Party (or its applicable Group Member) would not
receive all such rights, then the Parties shall use commercially reasonable efforts to
provide to, or cause to be provided to, such Party (or its applicable Group Member), to
the extent permitted by Law, rights related to such Non-Transferred Asset and take such
other actions as may reasonably be requested by such Party in order to place it,
insofar as reasonably possible, in the

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	 	 	 	same position as if such Non-Transferred Asset had been transferred as contemplated
hereby. In connection therewith, (i) the Party with title to or an interest in such
asset (or its applicable Group Member) shall promptly pass along to the Party
entitled to such asset (or its applicable Group Member) when received all benefits
derived with respect to any such Non-Transferred Asset, and (ii) the Party entitled
to such asset (or its applicable Group Member) shall pay, perform and discharge on
behalf of the other Party (or its applicable Group Member) all of the obligations
with respect to any such Non-Transferred Asset in a timely manner and in accordance
with the terms thereof. If and when such transfer may be effected without impairing
the rights of the Party entitled to such asset, the Parties shall take appropriate
steps to effect transfer of such Non-Transferred Asset.

2.3 No Representations or Warranties. Photowatt (on behalf of itself and each member of
the Photowatt Group) acknowledges and agrees that, except as expressly set forth in the Separation
Agreements, (a) no member of the ATS Group is making any representations or warranties, express or
implied, as to the condition, quality, merchantability or fitness of any Photowatt Asset, whether a
Non-Transferred Asset or otherwise, (b) any Non-Transferred Asset shall be transferred on an “as
is,” “where is” basis, and (c) the applicable member of the Photowatt Group shall bear the economic
and legal risks that any conveyance shall prove to be insufficient to vest in such Person good and
marketable title to any Non-Transferred Asset.

2.4 Assumption of Photowatt Liabilities. In furtherance of the transfer of the Photowatt
Assets by the ATS Group to the Photowatt Group as contemplated in Section 2.1, the
Photowatt Group hereby fully and unconditionally assumes and, to the extent they become due and
payable, covenants to pay or otherwise perform or discharge when done, the Photowatt Liabilities,
to the complete exoneration of the ATS Group, which assumptions are to occur prior to or concurrent
with completion of the Offering as contemplated by the Separation Agreements.

ARTICLE 3

THE OFFERING

3.1 Proceeds of the Offering. The Offering shall consist of a primary offering of
Photowatt Common Shares, with a secondary offering of Photowatt Common Shares by ATS to the extent
that the over-allotment option to be granted by ATS to the underwriters of the Offering is
exercised. The net proceeds of the Offering to Photowatt shall be used as described in the
Prospectus in the section entitled “Use of Proceeds.”

ARTICLE 4

MATTERS RELATING TO A SPIN-OFF

4.1 Spin-Off.

	 	(a)	 	ATS has the right, but not the obligation, following the consummation of the
Offering, to effect one or more Spin-Offs. ATS shall (in its sole and absolute
discretion) determine whether to effect a Spin-Off and, if so, the date of its
consummation and all of its terms, including (a) the form, structure and terms of

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	 	 	 	any transactions(s) and/or offerings(s) to effect the Spin-Off; (b) the timing of
and conditions to the consummation of the Spin-Off; (c) the selection of any
investment banker(s) and manager(s); and (d) the selection of any financial printer,
solicitation and/or exchange agent and financial, legal, accounting and other
advisors. In addition, ATS may, at any time and from time to time until the
completion of a Spin-Off, modify or change the terms of such a Spin-Off, including
by accelerating or delaying the timing of the consummation of all or part of such a
Spin-Off. At the request of ATS, Photowatt shall cooperate with ATS in all respects
to accomplish a Spin-Off and shall, at the direction of ATS, promptly take any and
all actions necessary or desirable to effect a Spin-Off, including, to the extent
necessary: (i) all actions required to be undertaken by Photowatt in connection with
an amalgamation of Photowatt with either an Affiliate of ATS or a corporation whose
shareholders and shareholdings are the same as the shareholders and shareholdings of
ATS (in either case, an “Amalco”), that does not result in an adverse “material
change” (as defined under Canadian Securities Laws) to the Photowatt Group,
including preparing and delivering a notice of a meeting of holders of Photowatt
Shares and soliciting votes in favour of any such amalgamation, which may be
specified by ATS, on terms to be specified by ATS (acting reasonably); and (ii) the
registration under the U.S. Securities Act and the Exchange Act of the Photowatt
Common Shares distributed by ATS on an appropriate registration form or forms, the
filing of all required documents with the securities regulatory authorities in each
of the Provinces and Territories of Canada (the “Canadian Securities Regulatory
Authorities”) and the SEC, including a prospectus prepared in accordance with
Canadian Securities Laws and the U.S. Securities Act and an application for relief
from the Canadian Securities Regulatory Authorities and the SEC in respect of
prospectus or registration requirements otherwise applicable, in any case to ensure
that the Photowatt Common Shares are not subject to resale restrictions under
Canadian Securities Laws (except those restrictions which may be applicable to
control block holders) and the U.S. Securities Act. Nothing in this Agreement shall
prohibit Photowatt from engaging (at its own expense) its own financial, legal,
accounting and other advisors in connection with a Spin-Off.

	 
	 	(b)	 	ATS will not effect a Spin-Off involving an amalgamation of Photowatt with an
Amalco unless ATS has obtained an advance tax ruling from the Canada Revenue Agency
reasonably acceptable to the board of directors of ATS, to the effect that any dividend
received by the Amalco will not be deemed under 55(2) of the Income Tax Act (Canada)
not to be a dividend received by the Amalco.

4.2 Actions Prior to a Spin-Off. In connection with a Spin-Off, the Parties shall take one
or more of the applicable actions set forth in this Section 4.2.

	 	(a)	 	ATS and Photowatt shall prepare and mail, prior to the effective date of the
Spin-Off, to the holders of ATS Common Shares, such information concerning Photowatt
and the Spin-Off and such other matters as ATS reasonably determines and as may be
required by Law. The Parties shall prepare, and Photowatt shall, to the extent required
by applicable Law, file with the SEC and Canadian Securities

- 12 -

 

	 	 	 	Regulatory Authorities any such documentation that ATS determines is necessary or
desirable to effect the Spin-Off, and each Party shall use commercially reasonable
efforts to obtain all necessary approvals from the SEC and Canadian Securities
Regulatory Authorities with respect thereto as soon as practicable.

	 
	 	(b)	 	Photowatt shall use commercially reasonable efforts to take all such action as
may be necessary or desirable under applicable state securities and blue sky Laws of
the United States (and any comparable Laws under any foreign jurisdiction) in
connection with the Spin-Off.
	 
	 	(c)	 	Photowatt shall prepare, file and use commercially reasonable efforts to seek
to make effective, an application for listing of the Photowatt Common Shares to be
distributed in the Spin-Off on The Nasdaq Global Market and the Toronto Stock Exchange,
subject in each case to official notice of issuance.
	 
	 	(d)	 	Photowatt shall use commercially reasonable efforts to take all such other
actions (or refrain from any actions) reasonably requested by ATS in connection with
the Spin-Off.

4.3 Stockholder-Related Matters Regarding a Spin-Off. With respect to a Spin-Off and
subject to Section 4.3(d):

	 	(a)	 	Distribution. For the purpose of this Section 4.3, the
contemplated distribution of Photowatt Common Shares owned by ATS to record holders of
ATS Common Shares entitled to receive Photowatt Common Shares in connection with the
Spin-Off may take place directly or indirectly, by way of a single step or a series of
one or more intermediate steps, including one or more distributions of shares of one or
more Affiliates of ATS.
	 
	 	(b)	 	Distribution Agent. On or prior to the effective date of the Spin-Off,
ATS shall deliver to a distribution agent to be appointed by ATS (the “Distribution
Agent”) for the benefit of holders of record of ATS Common Shares on the Record Date,
documentation reasonably required by the Photowatt Transfer Agent, representing all of
the outstanding Photowatt Common Shares then owned by ATS to be distributed pursuant to
the Spin-Off and ATS shall instruct the Distribution Agent to deliver to the Photowatt
Transfer Agent true, correct and complete copies of the share and transfer records
reflecting the record holders of ATS Common Shares entitled to receive Photowatt Common
Shares in connection with the Spin-Off. ATS shall cause its transfer agent to instruct
the Distribution Agent to distribute on the effective date of the Spin-Off or as soon
as reasonably practicable thereafter, directly or indirectly, by way of a single step
or a series of one or more intermediate steps, the appropriate number of Photowatt
Common Shares to each such record holder or designated transferee(s) of such record
holder. ATS shall (and shall instruct the Distribution Agent to) cooperate with
Photowatt and the Photowatt Transfer Agent, and Photowatt shall (and shall instruct the
Photowatt Transfer Agent to) cooperate with ATS and the Distribution Agent, in
connection with all aspects of the Spin-Off and all other matters relating to the
issuance and

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	 	 	 	delivery or certificates representing, or other evidence of ownership of, the
Photowatt Common Shares to be distributed to the holders of ATS Common Shares in
connection with the Spin-Off.
	 
	 	(c)	 	Number of Spin-Off Shares. Each record holder of ATS Common Shares on
the Record Date (or such record holder’s designated transferee(s)) shall be entitled to
receive in the Spin-Off, directly or indirectly, by way of a single step or a series of
one or more intermediate steps, a number of Photowatt Common Shares equal to the number
of ATS Common Shares held by such record holder on the Record Date, multiplied by a
fraction, (i) the numerator of which is the number of Photowatt Common Shares to be
distributed by ATS pursuant to Section 4.3(a) and (ii) the denominator of which
is the number of ATS Common Shares outstanding on the Record Date. If the Spin-Off
consists of more than one class of Photowatt Common Shares, each record holder of ATS
Common Shares shall receive Photowatt Common Shares of each class, calculated as
provided above, except that the calculation shall be performed separately for each such
class.
	 
	 	(d)	 	Rights of Holders of Spin-Off Shares. After the Spin-Off, until such
Photowatt Common Shares are duly registered in the names of the record holders of ATS
Common Shares entitled to receive Photowatt Common Shares in connection with the
Spin-Off, in accordance with applicable Law, Photowatt shall regard the Persons
entitled to receive such Photowatt Common Shares as record holders of Photowatt Common
Shares in accordance with the terms of the Spin-Off without requiring any action on the
part of such Persons. Photowatt agrees that, subject to any transfers of such Photowatt
Common Shares, (i) each such record holder shall be entitled to receive all dividends
payable on, and exercise voting rights and all other rights and privileges with respect
to, the Photowatt Common Shares then held by such record holder, and (ii) each such
record holder shall be entitled, without any action on the part of such record holder,
to receive one or more certificates representing, or other evidence of ownership of,
the Photowatt Common Shares then held by such record holder.
	 
	 	(e)	 	Other Transactions. If ATS determines (in its sole discretion) to
effect the separation or other disposition of the Photowatt Common Shares held by it
through a transaction other than a Spin-Off (whether by means of a plan of arrangement,
split off, a share exchange or otherwise), Photowatt shall use commercially reasonable
efforts to take all actions (or refrain from any actions) reasonably requested by ATS
in connection therewith.

ARTICLE 5

EMPLOYEE MATTERS AND NON-COMPETITION

5.1 Employee Matters

	 	(a)	 	Without the prior written consent of ATS, Photowatt shall not (and shall cause
its Affiliates not to) for a period of five years from the date hereof, directly or
indirectly, either for itself or another Person, (i) hire, employ, retain or Contract

- 14 -

 

	 	 	 	for service, or offer to hire, employ, retain or Contract for service, as a
director, officer, employee, partner, consultant, independent contractor or
otherwise, any individual employed by ATS or any of its Affiliates including any
such individual seconded by any member of the ATS Group to any member of the
Photowatt Group, or (ii) solicit for employment, solicit for hire, Contract for the
services of, or encourage any individual to terminate his or her employment with ATS
or any of its Affiliates, other than in publications of a general nature and not
specifically directed at any employee or employees of ATS or any of its Affiliates,
unless in either case, (A) ATS (and/or its applicable Affiliate) has terminated the
employment of such individual or (B) at least two years have elapsed since such
individual has voluntarily terminated his or her employment with ATS (and/or its
applicable Affiliate).
	 
	 	(b)	 	Without the prior written consent of Photowatt, ATS shall not (and shall cause
its Affiliates not to) for a period of five years from the date hereof, directly or
indirectly, either for itself or another Person, (i) hire, employ, retain or Contract
for service, or offer to hire, employ, retain or Contract for service, as a director,
officer, employee, partner, consultant, independent contractor or otherwise, any
individual employed by Photowatt or any of its Affiliates including any such individual
seconded by any member of the Photowatt Group to any member of the ATS Group, or (ii)
solicit for employment, solicit for hire, Contract for the services of, or encourage
any individual to terminate his or her employment with Photowatt or any of its
Affiliates, other than in publications of a general nature and not specifically
directed at any employee or employees of Photowatt or any of its Affiliates, unless in
either case, (A) Photowatt (and/or its applicable Affiliate) has terminated the
employment of such individual or (B) at least two years have elapsed since such
individual has voluntarily terminated his or her employment with Photowatt (and/or its
applicable Affiliate).

5.2 Non-Competition. For a period of three years from the date hereof, Photowatt shall
not, and shall cause the members of the Photowatt Group not to, directly or indirectly, engage in
any development, production, manufacture, marketing, distribution, promotion or sale of products
competitive with ATS Products in any country in the world in which ATS conducts its business.

ARTICLE 6

ACCESS TO AND DISCLOSURE OF INFORMATION

6.1 Restrictions on Disclosure of Information.

	 	(a)	 	Generally. Without limiting any rights or obligations under any other
existing or future agreement between the Parties and/or any other members of their
respective Group relating to confidentiality, each Party shall, and each Party shall
cause its respective Group members and its Representatives to, hold in strict
confidence, with at least the same degree of care that applies to ATS confidential and
proprietary Information pursuant to policies in effect as of the Separation Time, and
use only for the Designated Purposes, all confidential and proprietary

- 15 -

 

	 	 	 	Information concerning the other Group that is either in its possession as of the
Separation Time or furnished by the other Group or its respective Representatives at
any time pursuant to this Agreement, any other Separation Agreement or the
transactions contemplated hereby or thereby (including Information relating to
employee benefit or compensation plans, proprietary software and computer programs,
and business records). Notwithstanding the foregoing, each Party, its respective
Group members and each of their respective Representatives may disclose such
Information to the extent that such Person can demonstrate that such Information is
or was (i) in the public domain other than by the breach of this Agreement or by
breach of any other agreement between or among the Parties and/or any of their
respective Group members relating to confidentiality, or (ii) lawfully acquired from
a third Person on a non-confidential basis or independently developed by, or on
behalf of, such Person by Persons who do not have use of any such Information. Each
Party shall maintain, and shall cause its respective Group members and
Representatives to maintain, policies and procedures, and develop such further
policies and procedures as shall from time to time become necessary or appropriate,
to ensure compliance with this Section 6.1.
	 
	 	(b)	 	Non-Disclosure of Third Person Information by Photowatt. Photowatt
acknowledges that it and other members of the Photowatt Group may have in its or their
possession confidential or proprietary Information of third Persons that was received
under a confidentiality or non-disclosure agreement between a member of the ATS Group
and such third Person prior to the Separation Time. Photowatt shall (and shall cause
its respective Group members and Representatives to) hold in strict confidence and
restrict the use of the confidential and proprietary Information of third Persons to
which any member of the Photowatt Group has access, in accordance with the terms of any
agreements entered into prior to the Separation Time between members of the ATS Group
(whether acting through, on behalf of, or in connection with, the Photowatt Business or
otherwise) and such third Persons.
	 
	 	(c)	 	Non-Disclosure of Third Person Information by ATS. ATS acknowledges
that it and other members of the ATS Group may have in its or their possession
confidential or proprietary Information of third Persons that was received under a
confidentiality or non-disclosure agreement between a member of the Photowatt Group and
such third Person prior to the Separation Time. ATS shall (and shall cause its
respective Group members and Representatives to) hold in strict confidence and restrict
the use of the confidential and proprietary Information of third Persons to which any
member of the ATS Group has access, in accordance with the terms of any agreements
entered into prior to the Separation Time between members of the Photowatt Group and
such third Persons.
	 
	 	(d)	 	Disclosure of Confidential Information with a Group. Once confidential
Information has been disclosed to a Group, the members of such Group may disclose it to
their individual employees who are engaged directly in the Designated Purposes. Such
Group members may also disclose such confidential Information to its Representatives.
Such Group members shall advise each

- 16 -

 

	 	 	 	recipient of the confidential nature of such confidential Information, and shall
instruct each such recipient to comply with the confidentiality obligations
contained herein; and the Party responsible for such Group member shall be
responsible for the failure of any such recipient to do so. Upon a Party’s request,
the Party receiving confidential Information shall require its recipients of such
Information to sign an agreement of confidentiality and nondisclosure satisfactory
to the requesting Party. The obligations of the receiving Party with respect to such
recipient apply regardless of whether such recipient is an employee of such Party.

6.2 Legally Required Disclosure of Information. If either Party or any of its respective
Group members or Representatives becomes legally required to disclose any Information (the
“Disclosing Party”) that it is otherwise obligated to hold in strict confidence pursuant to
Section 6.1, such Party shall promptly notify the Person that owns or has a duty not to
disclose the Information (the “Owning Party”) and shall use all commercially reasonable efforts to
cooperate with the Owning Party so that the Owning Party may seek a protective order or other
appropriate remedy and/or waive compliance with this Section 6.2. All expenses reasonably
incurred by the Disclosing Party in seeking a protective order or other remedy shall be borne by
the Owning Party. If such protective order or other remedy is not obtained, or if the Owning Party
waives compliance with this Section 6.2, the Disclosing Party shall (a) disclose only that
portion of the Information that its legal counsel advises it is compelled to disclose or otherwise
stand liable for contempt or suffer other similar significant corporate censure or penalty, (b) use
all commercially reasonable efforts to obtain reliable assurance requested by the Owning Party that
confidential treatment shall be accorded such Information, and (c) promptly provide the Owning
Party with a copy of the Information so disclosed, in the same form and format so disclosed,
together with a list of all Persons to whom such Information was disclosed.

6.3 Access to Information. During the Retention Period, each Party shall (and shall cause
its respective Group members and Representatives to) cooperate with and afford to the other Party
reasonable access upon reasonable advance written request to all Information (other than
Information that is (a) protected from disclosure by the attorney-client privilege or work product
doctrine, (b) business sensitive from the perspective of any aspect of the Photowatt Business that
is competitive in a material respect with one or more aspects of the ATS Business, (c) the subject
of a confidentiality agreement between such Party and a third Person that prohibits disclosure to
the other Party, or (d) prohibited from disclosure under applicable Law) owned by such Party or one
of its Group members or within such Party’s or any of its respective Group member’s or
Representative’s possession that is created prior to the Spin-Off Date and that relates to the
business, assets or liabilities of the requesting Party (the “Requestor”), and such access is
reasonably required by the Requestor (i) to comply with requirements imposed on the Requestor by
any Governmental Authority, (ii) for use in any proceeding (except for a litigation matter between
the Parties or any of their respective Group members), (iii) to satisfy audit, accounting, Tax or
similar requirements, (iv) to obtain insurance, or (v) to comply with the Requestor’s obligations
under this Agreement or any other Separation Agreement. As used in this Agreement, “access” shall
mean the obligation of a Party in possession of Information (the “Possessor”) requested by the
Requestor to exert its commercially reasonable efforts to locate all requested Information that is
owned and/or possessed by Possessor or any of its respective Group members or Representatives. The
Possessor, at its own expense, shall conduct a diligent search designed to identify all requested
Information and shall collect all such Information for

- 17 -

 

inspection by the Requestor during normal business hours at the Possessor’s place of business.
Subject to such confidentiality and/or security obligations as the Possessor may reasonably deem
necessary, the Requestor may have all requested Information duplicated at Requestor’s expense.
Alternatively, the Possessor may choose to deliver, at the Requestor’s expense, all requested
Information to the Requestor in the form requested by the Requestor. The Possessor shall notify the
Requestor in writing at the time of delivery if such Information is to be returned to the
Possessor. In such case, the Requestor shall return such Information when no longer needed to the
Possessor at the Possessor’s expense. In connection with providing Information pursuant to this
Section 6.3, each Party shall, upon the request of the other Party and upon reasonable
advance notice, make available during normal business hours its respective employees (and those
employees of its respective Group members and Representatives, as applicable) to the extent that
they are reasonably necessary to discuss and explain all requested Information with and to the
Requestor.

6.4 Record Retention. Photowatt shall (and shall cause each of its other Group members to)
adopt and comply with a prudent record retention policy with respect to Information owned by or in
the possession of the Photowatt Group and created prior to the Spin-Off Date that is no less
stringent than the ATS record retention policy in effect as of the Separation Time or as ATS may
modify such policy between the Separation Time and the Spin-Off Date, provided that ATS notifies
Photowatt of any such modifications. In any event, such record retention policy will require
Photowatt to retain Information owned by or in the possession of the Photowatt Group and created
prior to the Spin-Off Date for a period of not less than seven years. Each Party shall, at its sole
cost and expense, preserve and retain all Information in its respective possession or control that
the other Party has the right to access pursuant to Section 6.3 or that it is required to
preserve and retain in accordance with such record retention policy or for any longer period as may
be required by (a) any Governmental Authority, (b) any litigation matter, (c) applicable Law, or
(d) any Separation Agreement (as applicable, the “Retention Period”). If either Party wishes to
dispose of any Information that it is obligated to retain under this Section 6.4 prior to
the expiration of the Retention Period, then that Party shall first provide 45 days’ written notice
to the other Party, and the other Party shall have the right, at its option but at the expense of
the Party that desires to dispose of such Information, upon prior written notice within such 45-day
period, to take possession of such Information within 90 days after the date of the notice provided
pursuant to this Section 6.4. Written notice of intent to dispose of such Information shall
include a description of the Information in detail sufficient to allow the other Party to
reasonably assess its potential need to retain such materials.

6.5 Production of Witnesses. For seven years after the Separation Time, each Party shall
(and shall cause each of its respective Group members to) use commercially reasonable efforts to
make available to each other, upon written request, its past and present Representatives as
witnesses to the extent that any such Representatives may reasonably be required (giving
consideration to the business demands upon such Representatives) in connection with any legal,
administrative or other proceedings in which the requesting Party may from time to time be
involved.

6.6 Reimbursement. Unless otherwise provided in this Article 6, each Party
providing access to Information or witnesses to the other Party pursuant to Sections 6.3,
6.4 or 6.5 shall be entitled to receive from the receiving Party, upon the
presentation of invoices

- 18 -

 

therefor, payment for all reasonable, out-of-pocket costs and expenses (excluding allocated
compensation, salary and overhead expenses) as may be reasonably incurred in providing such
Information or witnesses.

6.7 Other Agreements Regarding Access to Information. The rights and obligations of the
Parties under this Article 6 are subject to any specific limitations, qualifications or
additional provisions on the sharing, exchange or confidential treatment of Information set forth
in this Agreement or any other Separation Agreement.

6.8 Acquisition of Photowatt by Another Person. If Photowatt enters into an agreement with
a third Person to directly or indirectly sell all or any portion of the Photowatt Business (other
than in the ordinary course of business consistent with past practice), together with the
Information related thereto, whether pursuant to a share or asset sale, merger or otherwise, ATS
shall have the right to duplicate any Information held by Photowatt that relates to (a) the
Photowatt Business as conducted through the Spin-Off Date (or the date of the disposition to such
third Person if a Spin-Off has not occurred), (b) the transactions contemplated by this Agreement
and the other Separation Agreements, and (c) the Financial Statements and any Information relating
thereto included in financial statements of ATS. Photowatt shall, in connection with any such
disposition (x) provide ATS not less than 20 days’ written notice prior to the consummation of such
disposition, and (y) not disclose any Information of ATS or relating to the ATS Business to such
third Person without the express written consent of ATS (which may be withheld in its absolute and
sole discretion). In addition, ATS shall have the right, in its sole discretion, to require
Photowatt to destroy or return to ATS all or any portion of such Information of or relating to the
ATS Business prior to such disposition. If ATS enters into an agreement with a third Person to sell
all or any portion of the ATS Business, ATS shall not in connection with any such disposition
disclose any Information of Photowatt or relating to the Photowatt Business to such third Person
without the express written consent of Photowatt (which may be withheld in its absolute and sole
discretion).

ARTICLE 7

ADDITIONAL COVENANTS

7.1 Further Assurances. The Parties shall (or shall cause their appropriate Group members
or Representatives, as appropriate, to) execute and deliver such other agreements, instruments and
documents as may be necessary or desirable in order to effect the transactions contemplated by this
Agreement and the other Separation Agreements. At the request of Photowatt, ATS shall (and shall
cause applicable members of the ATS Group to) execute and deliver to Photowatt and/or applicable
members of the Photowatt Group such other instruments of transfer, conveyance, assignment,
substitution and confirmation and take such other actions as Photowatt may reasonably deem
necessary or desirable in order (a) to transfer, convey and assign to Photowatt and the other
members of the Photowatt Group, as applicable, the Photowatt Assets, (b) to put Photowatt and the
other members of the Photowatt Group, as applicable, in actual possession and operating control
thereof, and (c) to permit Photowatt and the other members of the Photowatt Group, as applicable,
to exercise all rights with respect thereto. At the request of ATS, Photowatt shall (and shall
cause applicable members of the Photowatt Group to) execute and deliver to ATS and/or applicable
members of the ATS Group all instruments, assumptions, novations, undertakings, substitutions or
other documents and take such other

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action as ATS may reasonably deem necessary or desirable in order to ensure that Photowatt and the
other members of the Photowatt Group fully and unconditionally assume and discharge the Photowatt
Liabilities as contemplated under this Agreement, the other Separation Agreements or any document
in connection herewith or therewith, and relieve the ATS Group of any Liability with respect
thereto and evidence the same to third Persons. Except as otherwise expressly provided in this
Agreement or any other Separation Agreement, no member of the ATS Group shall be obligated to incur
any out-of-pocket costs, expenses and fees in connection with its obligations under this
Section 7.1, including any attorneys’ fees, recording, assignment or other similar fees.

7.2 Performance. ATS shall cause to be performed, and hereby guarantees the performance
of, all actions, agreements and obligations set forth in this Agreement or in any Separation
Agreement to be performed by any member of the ATS Group. Photowatt shall cause to be performed,
and hereby guarantees the performance of, all actions, agreements and obligations set forth in this
Agreement or in any Separation Agreement to be performed by any member of the Photowatt Group. Each
Party further agrees that it shall cause its other Group members not to take any action or fail to
take any action inconsistent with such Party’s obligations under this Agreement, any other
Separation Agreement or the transactions contemplated hereby or thereby.

7.3 ATS Guarantees. Photowatt acknowledges that members of the ATS Group have entered
into various arrangements in which one or more members of the ATS Group issued or made available
guarantees, sureties, bonds, letters of credit or similar instruments or are the primary obligors
on other agreements, in any such case to support or facilitate the Existing Photowatt Business or
the Photowatt Business (the “Business Guarantees”). It is understood that none of such Business
Guarantees shall continue after the Separation Time. On or as promptly as practicable following
the date hereof, but in no event later than the Separation Time, Photowatt shall obtain
replacements for such Business Guarantees or will either terminate the business transactions or
programs of the member of the Photowatt Group supported or facilitated by such Business Guarantees
or arrange for itself or one of its Affiliates to be substituted as the primary obligor thereto
(collectively, the “Substitute Guarantees”).

7.4 TPC Contribution Agreement.

	 	(a)	 	Assumption. Photowatt covenants and agrees to observe, perform and
fulfill each and every Liability, covenant, term and condition of ATS in, to and under
the TPC Contribution Agreement from and including the date of assignment of the TPC
Contribution Agreement to Photowatt, to the same extent as if Photowatt had been
originally named as a party to the TPC Contribution Agreement together with ATS,
collectively as “the Proponent” as such term is used in the TPC Contribution Agreement.
	 
	 	(b)	 	No Amendment, Termination or Waiver. During such period of time as ATS
remains a party to and bound by the TPC Contribution Agreement, Photowatt covenants and
agrees: (i) not to amend or assign the TPC Contribution Agreement, or to seek the
consent of any other party to the TPC Contribution Agreement to the waiver of any
provisions thereof, without ATS’ prior written

- 20 -

 

	 	 	 	consent and (ii) not to terminate or breach the TPC Contribution Agreement or, for
greater clarity, effect a material change in the total scope or nature of any
element of the “Project” as such term is used in the TPC Contribution Agreement,
without prior consultation with ATS, such consultation to be conducted in good faith
and for a reasonable duration.
	 
	 	(c)	 	Further Assurances. For greater clarity, if ATS determines (in its
sole discretion) to seek any further consent or consents with respect to the assignment
of the TPC Contribution Agreement, the assignment of Assets subject to the TPC
Contribution Agreement, or the release of ATS from any or all Liabilities, covenants,
terms or conditions under TPC Contribution Agreement, Photowatt covenants and agrees to
take all actions (or refrain from any actions) reasonably requested by ATS in
connection therewith.

7.5 Original Corporate Records.

	 	(a)	 	If any member of the ATS Group has possession of original corporate records of
the Photowatt Group, ATS will cause such member to promptly deliver such original
corporate records to the Photowatt Group upon request.
	 
	 	(b)	 	If any member of the Photowatt Group has possession of original corporate
records of the ATS Group, Photowatt will cause such member to promptly deliver such
original corporate records to the ATS Group upon request.

7.6 License of ATS Automation Solar Know-How.

	 	(a)	 	License. Subject to the terms and conditions of this Agreement,
including Section 5.2, ATS hereby grants to Photowatt an irrevocable, personal,
non-exclusive, worldwide, royalty-free, perpetual right and license to use the ATS
Solar Automation Know-How now in Photowatt’s possession, solely for Photowatt’s
internal use in conducting Photowatt’s business including the right to make, have made,
and use, but excluding the right to market and sell manufacturing equipment embodying
such ATS Solar Automation Know-How.
	 
	 	(b)	 	Sub-Licensing. The license granted in Section 7.6(a) is
personal and non-transferable and may not be sub-licensed without the express written
consent of ATS, except to a wholly-owned Subsidiary of Photowatt and then only so long
as it remains a wholly-owned Subsidiary of Photowatt.
	 
	 	(c)	 	Restrictions. For greater certainty, nothing in the license granted in
Section 7.6(a):

	 	(i)	 	entitles Photowatt to use the ATS Solar Automation
Know-How for the benefit of a competitor of ATS other than may be
incidental to the manufacturing of equipment for Photowatt;

- 21 -

 

	 	(ii)	 	grants Photowatt any rights in respect of any patent
or application therefor, trade-mark or copyright owned by the ATS Group or
any intellectual property rights owned by any third party;
	 
	 	(iii)	 	grants Photowatt any rights in respect of know-how
arising after the date of execution of this agreement;
	 
	 	(iv)	 	prevents any member of the ATS Group from continuing
to manufacture equipment or offering services in respect of the Field of
Use for the solar industry or using the ATS Solar Automation Know-How in
any way; nor
	 
	 	(v)	 	prevents either Party from using know-how, technology
or information generally known within the applicable industry.

	 	(d)	 	Acknowledgment. Photowatt acknowledges that the purpose of this
Agreement is to facilitate Photowatt in continuing to conduct its business by providing
for the continued use of ATS Solar Automation Know-How now in its possession.
Photowatt also acknowledges that, as of the execution of this Agreement, it is in
possession of all ATS Solar Automation Know-How licensed hereunder and that ATS has no
affirmative obligation hereunder to actively disclose, transmit or deliver to Photowatt
in any manner any ATS Solar Automation Know-How.
	 
	 	(e)	 	No Ongoing Assistance. ATS shall have no ongoing obligation to provide
further information or assistance to Photowatt, to provide technical advice, to send
personnel to Photowatt’s facilities or to train Photowatt’s personnel, except as ATS
and Photowatt may specifically agree.
	 
	 	(f)	 	No Rights to Improvements. ATS shall have no obligation to provide
Photowatt with updates or improvements to the ATS Solar Automation Know-How or to
know-how developed after the date of execution of this Agreement and neither Party
shall have any obligation to disclose to the other improvements to the ATS Solar
Automation Know-How developed or acquired by that Party.
	 
	 	(g)	 	No Warranties. ATS does not warrant the quality, utility,
merchantability, or any other characteristic of the ATS Solar Automation Know-How or of
any product made, used or sold under the license granted in Section 7.6(a).
ATS shall not be liable or responsible in any way (including incidental or
consequential damages) for any use which Photowatt or any customer of Photowatt makes
of any product manufactured, used or sold which incorporates the ATS Solar Automation
Know-How licensed under this Agreement. Nothing herein shall be construed as a
representation or warranty by ATS (i) as to the results to be attained by the
utilization of the rights granted under this agreement; or (ii) that there is any
warranty other than as expressly described herein.
	 
	 	(h)	 	Confidentiality. The Parties acknowledge that the ATS Solar Automation
Know-How, whether written or unwritten, is considered secret, confidential and
proprietary to ATS and as such, shall be deemed to be confidential whether or not such
information, in written form or not, is so identified by ATS as being

- 22 -

 

	 	confidential. Specific ATS Solar Automation Know-How disclosed by ATS to Photowatt
shall not be deemed to be in the public domain merely because it is addressed in a
general manner as part of information in the public domain, provided that the
specific information is not public. Photowatt shall not disclose, for a period of
ten years from the date first written above, any and all such confidential ATS Solar
Automation Know-How, provided, however, that such obligations of secrecy shall not
include information that:

	 	(i)	 	is at the time of disclosure generally available to the public, or
	 
	 	(ii)	 	becomes after disclosure generally available to the
public through no fault of the Photowatt, or
	 
	 	(iii)	 	is received by Photowatt from third parties and
such third party is not prohibited from disclosing the information to
Photowatt.

	 	 	 	During such period, Photowatt shall ensure that no such part of the ATS Solar
Automation Know-How that is confidential shall be disclosed except to responsible
Representatives who require such information during the course of their duties, and
then only in accordance with Section 7.6(j).
	 
	 	(i)	 	Further Covenants. Photowatt shall not use, disclose or allow access
to the ATS Solar Automation Know-How for any purpose other than the purposes permitted
by the license granted to it in Section 7.6(a) and in any event in any way that
is, directly or indirectly, detrimental to ATS or its Affiliates. Photowatt shall keep
the ATS Solar Automation Know-How strictly confidential and treat the ATS Solar
Automation Know-How as proprietary to ATS. Photowatt shall not divulge to, or cause or
permit to be divulged to, any third party other than Representatives, in any manner
whatsoever, the ATS Solar Automation Know-How.
	 
	 	(j)	 	Disclosure to Representatives. Photowatt may disclose ATS Solar
Automation Know-How to only those of its Representatives as is necessary for the
purposes permitted by the license granted to it in Section 7.6(a). Photowatt
shall inform such Representatives of the confidential nature of the ATS Solar
Automation Know-How and cause such Representatives to agree to treat such ATS Solar
Automation Know-How confidentially in accordance with this Agreement and not to use,
disclose or allow access to such ATS Solar Automation Know-How except as permitted
herein. Photowatt shall be responsible for any breach of this Agreement by any of its
Representatives. Photowatt shall take all reasonable measures, including court
proceedings, at Photowatt’s sole expense, to restrain its Representatives from making
unauthorized use or disclosure of the ATS Solar Automation Know-How.

7.7 Legal and Regulatory Matters. Until ATS and its Affiliates cease to hold in aggregate
less than 50% of the outstanding Photowatt Common Shares, Photowatt shall not adopt policies or
directives relating to legal or regulatory compliance that are inconsistent in any material respect
with the policies and directives identified by ATS as critical to legal and

- 23 -

 

regulatory compliance; provided, however, that nothing contained herein shall
prevent adoption of policies or directives that, in the opinion of counsel to Photowatt, are
necessary or desirable to comply with then applicable Law.

ARTICLE 8

MUTUAL RELEASES; INDEMNIFICATION

8.1 Release of Pre-Closing Claims.

	 	(a)	 	Photowatt Release. Except as provided in Section 8.1(d) to
this Agreement, effective as of the Separation Time, Photowatt does hereby, for itself
and as agent for each member of the Photowatt Group, remise, release and forever
discharge the ATS Indemnified Persons from any and all Liabilities whatsoever, whether
at law or in equity (including any right of contribution), existing or arising from any
acts or events occurring or failing to occur or alleged to have occurred or to have
failed to occur or any conditions existing or alleged to have existed on or before the
Separation Time, including in connection with the transactions and all other activities
to implement any of the Offering or the transactions contemplated by this Agreement or
any of the Separation Agreements.
	 
	 	(b)	 	ATS Release. Except as provided in Section 8.1(d), effective
as of the Separation Time, ATS does hereby, for itself and as agent for each member of
the ATS Group, remise, release and forever discharge the Photowatt Indemnified Persons
from any and all Liabilities whatsoever, whether at law or in equity (including any
right of contribution), existing or arising from any acts or events occurring or
failing to occur or alleged to have occurred or to have failed to occur or any
conditions existing or alleged to have existed on or before the Separation Time,
including in connection with the transactions and all other activities to implement any
of the Offering or the transactions contemplated in this Agreement or any of the
Separation Agreements.
	 
	 	(c)	 	Release and Waiver of Unknown Claims. Photowatt, for itself and as
agent for each member of the Photowatt Group, and ATS, for itself and as agent for each
member of the ATS Group, do hereby agree, represent, and warrant that the matters
released herein are not limited to matters which are known or disclosed. Photowatt,
for itself and as agent for each member of the Photowatt Group, and ATS, for itself and
as agent for each member of the ATS Group, may hereafter discover facts in addition to
or different from those which it now knows or believes to be true with respect to the
subject matter of this release, but each shall be deemed to have, finally, and forever
settled and released any and all claims, known or unknown, suspected or unsuspected,
contingent or non-contingent, whether or not concealed or hidden, which now exist, or
heretofore have existed upon any theory of law or equity now existing or coming into
existence in the future, including but not limited to, conduct which is negligent,
intentional, with or without malice, or a breach of any duty, law or rule, without
regard to the subsequent discovery or existence of such different or additional facts.

- 24 -

 

	 	(d)	 	No Impairment. Nothing contained in Section 8.1(a),
Section 8.1(b) or Section 8.1(c) shall impair any right of any Person
to enforce this Agreement or any other Separation Agreement or other agreement in force
and effect between Photowatt and ATS as of the Separation Time, in each case in
accordance with its terms, including the provisions of Section 8.2, Section
8.3 and Section 8.4.
	 
	 	(e)	 	No Actions as to Released Claims. Photowatt agrees, for itself and as
agent for each member of the Photowatt Group, not to make any claim or demand, or
commence any Action asserting any claim or demand, including any claim of contribution
or any indemnification, against ATS or any member of the ATS Group, or any other Person
released pursuant to Section 8.1(a), with respect to any Liabilities released
pursuant to Section 8.1(a). ATS agrees, for itself and as agent for each member
of the ATS Group, not to make any claim or demand, or commence any Action asserting any
claim or demand, including any claim of contribution or any indemnification, against
Photowatt or any member of the Photowatt Group, or any other Person released pursuant
to Section 8.1(b), with respect to any Liabilities released pursuant to
Section 8.1(b).
	 
	 	(f)	 	Further Instruments. At any time, at the request of the other Party,
each Party shall cause each member of its respective Group to execute and deliver
releases reflecting the provisions hereof and such other documents as are necessary to
effect the purposes hereof.

8.2 Indemnification by Photowatt. Subject to Section 8.5, Photowatt shall
indemnify and hold harmless each ATS Indemnified Person from and against any and all Losses
relating to, arising out of or in connection with the following, whether such Losses arise or
accrue prior to, on or following the Separation Time:

	 	(a)	 	The failure of Photowatt or any other member of the Photowatt Group or any
other Person to pay, perform or otherwise properly discharge any of the Photowatt
Liabilities in accordance with their respective terms;
	 
	 	(b)	 	The Existing Photowatt Business, the Photowatt Business or any Photowatt
Liability (including any Photowatt Liability guaranteed by a member of the ATS Group);
	 
	 	(c)	 	Any breach by Photowatt or any member of the Photowatt Group of this Agreement
or any Separation Agreement;
	 
	 	(d)	 	With respect to all information contained in the Registration Statement, the
Prospectus, the Preliminary Prospectus or any other materials (excluding in the case of
such other materials any other materials distributed solely by or on behalf of ATS)
distributed in connection with the Offering or the transactions contemplated in the
Separation Agreements, any untrue statement or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements

- 25 -

 

	 	 	 	therein not misleading, other than with respect to the ATS Disclosure Portions; and
	 
	 	(e)	 	Any Liability, covenant, term and condition of ATS in, to and under the TPC
Contribution Agreement.

8.3 Indemnification by ATS. Subject to Section 8.5, ATS shall indemnify and hold
harmless each Photowatt Indemnified Person from and against any and all Losses incurred by such
Photowatt Indemnified Person arising out of or in connection with the following, whether such
Losses arise or accrue prior to, on or following the Separation Time:

	 	(a)	 	The failure of ATS or any other member of the ATS Group or any other Person to
pay, perform or otherwise properly discharge any of the ATS Liabilities in accordance
with their respective terms;
	 
	 	(b)	 	The ATS Business or any ATS Liability, excluding any ATS Liability with respect
to the TPC Contribution Agreement;
	 
	 	(c)	 	Any breach by ATS or any member of the ATS Group of this Agreement or any
Separation Agreement; and
	 
	 	(d)	 	With respect to all information contained in the ATS Disclosure Portions, any
untrue statement or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact required to be stated therein or necessary to make
the statements therein not misleading.

8.4 Claim Procedure.

	 	(a)	 	Claim Notice. A Party that seeks indemnity under this Article 8 or
under any other Separation Agreement (an “Indemnified Party”) shall give written notice
(a “Claim Notice”) to the Party from whom indemnification is sought (an “Indemnifying
Party”) in respect of Losses arising from any matter other than Third Party Claims. The
Claim Notice must contain (i) a description and, if known, estimated amount (the
“Claimed Amount”) of any Losses incurred or reasonably expected to be incurred by the
Indemnified Party, (ii) a reasonable explanation of the basis for the Claim Notice to
the extent of facts then known by the Indemnified Party, and (iii) a demand for payment
of those Losses. No failure or delay or deficiency on the part of the Indemnified Party
to so notify the Indemnifying Party shall relieve the Indemnifying Party of any
Liability or obligation hereunder except to the extent of any Losses caused by or
arising out of such failure, delay or deficiency.
	 
	 	(b)	 	Response to Notice of Claim. Within 30 days after delivery of a Claim
Notice, the Indemnifying Party shall deliver to the Indemnified Party a written
response in which the Indemnifying Party shall either: (i) agree that the Indemnified
Party is entitled to receive all of the Claimed Amount and, in which case, the
Indemnifying Party shall pay the Claimed Amount using a payment method

- 26 -

 

	 	 	 	reasonably acceptable to the Indemnified Party; or (ii) dispute that the Indemnified
Party is entitled to receive all or any portion of the Claimed Amount, in which
case, the Parties shall resort to the dispute resolution procedures set forth in
Section 9.19.
	 
	 	(c)	 	Contested Claims. If the Indemnifying Party disputes that the
Indemnified Party is entitled to receive all or any portion of the Claimed Amount, as
soon as practicable but in no event later than 10 Business Days after the receipt of
the notice referenced in Section 8.4(b), the Parties shall begin the process to
resolve the matter in accordance with the dispute resolution provisions of Section
9.19 hereof. Upon ultimate resolution thereof, the Parties shall take such actions
as are reasonably necessary to comply with such resolution.
	 
	 	(d)	 	Third Party Claims.

	 	(i)	 	If the Indemnified Party receives notice or otherwise
learns of the assertion by a Person who is not a member of either Group of
any claim or the commencement of any Action (in each case, a “Third Party
Claim”) with respect to which the Indemnifying Party may be obligated to
provide indemnification under this Article 8, the Indemnified
Party shall give written notification to the Indemnifying Party of the
Third Party Claim. Such notification shall be given within five Business
Days after receipt by the Indemnified Party of notice of such Third Party
Claim, shall be accompanied by reasonable supporting documentation
submitted by such third party (to the extent then in the possession of the
Indemnified Party) and shall describe in reasonable detail (to the extent
known by the Indemnified Party) the facts constituting the basis for such
Third Party Claim and the amount of the claimed Losses; provided,
however, that no delay or deficiency on the part of the
Indemnified Party in so notifying the Indemnifying Party shall relieve the
Indemnifying Party of any Liability or obligation hereunder except to the
extent of any Losses caused by or arising out of such failure. Within 20
days after delivery of such notification, the Indemnifying Party may, upon
written notice thereof to the Indemnified Party, assume control of the
defense of such Third Party Claim with counsel reasonably satisfactory to
the Indemnified Party. During any period in which the Indemnifying Party
has not so assumed control of such defense, the Indemnified Party shall
control such defense.
	 
	 	(ii)	 	The Party not controlling such defense (the
“Non-Controlling Party”) may participate therein at its own expense;
provided, however, that if the Indemnifying Party assumes
control of such defense and the Indemnified Party concludes, upon the
written opinion of counsel, that the Indemnifying Party and the
Indemnified Party have conflicting interests or different defenses
available with respect to such Third Party Claim, the reasonable fees and
expenses of separate counsel to the Indemnified Party shall be considered
“Losses” for purposes of this Agreement;

- 27 -

 

	 	 	 	provided, further, that the Indemnifying Party shall not be
responsible for the fees or expenses of more than one legal firm in any
single jurisdiction for all of the Indemnified Parties; provided,
however, that in the event that such legal firm is conflicted
amongst the Indemnified Parties, then the Indemnifying Party shall be
responsible for the fees or expenses of up to two legal firms in any single
jurisdiction for all of the Indemnified Parties. The Party controlling such
defense (the “Controlling Party”) shall keep the Non-Controlling Party
reasonably advised of the status of such Third Party Claim and the defense
thereof and shall consider in good faith recommendations made by the
Non-Controlling Party with respect thereto. The Non-Controlling Party shall
furnish the Controlling Party with such Information as it may have with
respect to such Third Party Claim (including copies of any summons,
complaint or other pleading that may have been served on such Party and any
written claim, demand, invoice, billing or other document evidencing or
asserting the same) and shall otherwise cooperate with and assist the
Controlling Party in the defense of such Third Party Claim.
	 
	 	(iii)	 	The Indemnifying Party shall not agree to any
settlement of, or the entry of any judgment arising from, any such Third
Party Claim without the prior written consent of the Indemnified Party,
which consent shall not be unreasonably withheld or delayed;
provided, however, that the consent of the Indemnified
Party shall not be required if (A) the Indemnifying Party agrees in
writing to pay any amounts payable pursuant to such settlement or
judgment, (B) such settlement or judgment includes a full, complete and
unconditional release of the Indemnified Party from further Liability and
(C) such settlement does not create any financial or other obligation on
the part of the Indemnified Party. The Indemnified Party shall not agree
to any settlement of, or the entry of any judgment arising from, any such
Third Party Claim without the prior written consent of the Indemnifying
Party, which consent shall not be unreasonably withheld or delayed.

8.5 Survival; Limitations.

	 	(a)	 	Except to the extent expressly set forth in this Agreement or any other
Separation Agreement, all covenants and agreements of the Parties contained in the
Separation Agreements shall survive each of the Offering and a Spin-Off. The
limitation period applicable to any proceeding in respect of such covenants and
agreements shall be as prescribed by applicable Law. To the extent the limitation
period applicable to any proceeding in respect of such covenants and agreements is
governed by the Laws of the Province of Ontario, the limitation period shall be solely
as prescribed in sections 15-17 of the Limitations Act, 2002 and any other limitation
period in respect of such proceeding (including that provided for in section 4 of the
Limitations Act, 2002) is extended accordingly. The rights and obligations of ATS,
Photowatt and each of their respective Indemnified Persons

- 28 -

 

	 	 	 	under this Agreement shall survive the direct or indirect sale, assignment or other
transfer by any Party of any Assets or Liabilities.
	 
	 	(b)	 	The amount of any Losses for which indemnification is provided under this
Agreement shall be net of any Tax Benefit and any amounts actually recovered by the
Indemnified Party from any third Person (including amounts actually recovered under
insurance policies) with respect to such Losses. Any Indemnifying Party hereunder shall
be subrogated to the rights of the Indemnified Party upon payment in full of the amount
of the relevant indemnifiable Losses. An insurer who would otherwise be obligated to
pay any claim shall not be relieved of the responsibility with respect thereto or,
solely by virtue of the indemnification provision hereof, have any subrogation rights
with respect thereto. If any Indemnified Party recovers an amount from a third Person
in respect of Losses for which indemnification is provided in this Agreement after the
full amount of such indemnifiable Losses has been paid by an Indemnifying Party or
after an Indemnifying Party has made a partial payment of such indemnifiable Losses and
the amount received from the third Person exceeds the remaining unpaid balance of such
indemnifiable Losses, then the Indemnified Party shall promptly remit to the
Indemnifying Party the excess, if any, of (X) the sum of the amount theretofore paid by
such Indemnifying Party in respect of such indemnifiable Losses plus the amount
received from the third Person in respect thereof, over (Y) the full amount of such
indemnifiable Losses.
	 
	 	(c)	 	Notwithstanding anything to the contrary in this Article 8, the initial
presumption shall be that there is no insurance coverage for any such Losses, and the
Indemnifying Party shall, upon request by the Indemnified Party, fully indemnify and
hold harmless the Indemnified Party from and against any and all such Losses. Once the
Indemnifying Party has discharged this obligation to the Indemnified Party, the
Indemnifying Party may request that the Indemnified Party pursue insurance coverage
from one or more insurers in connection with such Losses. If so requested, the
Indemnified Party shall pursue insurance coverage, including, if necessary, the filing
of coverage litigation, all of which shall be at the Indemnifying Party’s sole cost and
expense. The Indemnifying Party shall pay directly or promptly reimburse the
Indemnified Party for all such costs and expenses, as directed by the Indemnified
Party. The Indemnified Party shall retain full and exclusive control of all such
matters (including the settlement of underlying covered claims and/or coverage claims
against insurers), and the Indemnified Party shall have the right to select counsel
with the concurrence of Indemnifying Party, which concurrence shall not be withheld
unreasonably. The net proceeds of any insurance recovery (after deducting any costs and
expenses that have not yet been paid or reimbursed by the Indemnifying Party) shall be
paid to the Indemnifying Party. At all times, the Indemnifying Party shall cooperate
with the Indemnified Party’s insurers and/or with the Indemnified Party in the pursuit
of insurance coverage, as and when reasonably requested to do so by the Indemnified
Party. It is not the intent of this Section 8.5(c) to absolve the Indemnifying
Party of any responsibility to the Indemnified Party for those Losses in connection
with which the Indemnified Party actually secures insurance

- 29 -

 

	 	 	 	coverage, but to allocate the costs of pursuing such coverage to the Indemnifying
Party and to provide the Indemnified Party with a full, interim indemnity from the
Indemnifying Party until such time as the extent of insurance coverage is determined
and is obtained. Notwithstanding anything to the contrary in this Section
8.5(c), if the Indemnified Party (in its absolute and sole discretion)
determines that it is necessary to do so, the Indemnified Party may pursue insurance
coverage for the benefit of the Indemnified Party before the Indemnifying Party has
fully discharged its obligations to the Indemnified Party under this Agreement. In
such event, the Indemnified Party may unilaterally take any steps it determines are
necessary to preserve such insurance coverage, including tendering the defense of
any claim or suit to an insurer or insurers of the Indemnified Party if the
Indemnified Party concludes that such action may be required by the relevant
insurance policy or policies. Any such actions by the Indemnified Party shall not
relieve the Indemnifying Party of any of its obligations to the Indemnified Party
under this Agreement, including the Indemnifying Party’s obligation to pay directly
or reimburse the Indemnified Party for costs and expenses.
	 
	 	(d)	 	Any indemnification payment made under this Agreement shall be characterized
for Tax purposes as a contribution or distribution or payment of an assumed or retained
liability, as applicable.
	 
	 	(e)	 	ATS’ and Photowatt’s indemnity obligations under Sections 8.2 and
8.3 shall be reduced to reflect any Tax Benefit realized, in the year in which
the indemnity payment is required to be made or in any prior year, by the Indemnified
Party or any of its Affiliates. To the extent that the claim with respect to which an
indemnity obligation arises has not given rise to a Tax Benefit in prior year or in the
year in which the indemnity payment is to be made, but gives rise to a Tax Benefit in a
later year, the Indemnified Party shall pay to the Indemnifying Party the amount of
such Tax Benefit. For purposes of determining the amount of any payment due to an
Indemnified Party pursuant to this Section 8.5(e), ATS and Photowatt and their
respective Affiliates shall be deemed to use all other deductions, amortizations,
exclusions from income or other allowances (to the extent that such deductions,
amortizations, exclusions from income or other allowances are entitled to be used under
applicable tax law) prior to the use of any Tax Benefits in respect of which the
Indemnifying Party is obligated to pay the Indemnified Party hereunder.
	 
	 	(f)	 	Notwithstanding anything in this Agreement or any other Separation Agreement to
the contrary, in no event shall any Party or any of its Group members be liable to the
other Party or any other Person under this Agreement or any other Separation Agreement
for, and each Party (on behalf of itself, its Affiliates and other Indemnified Persons)
hereby releases the other Party from all claims for, special, collateral, indirect,
consequential, incidental or punitive damages (including lost profits or savings),
however caused and on any theory of liability (including negligence), even if advised
of their possible existence; provided, however, that the foregoing
limitations

- 30 -

 

	 	 	 	shall not limit either Party’s indemnification obligations as set forth in
Article 8 hereof in respect of any Third Party Claim.

8.6 Production of Witnesses and Documents. If an Indemnifying Party chooses to defend or
to seek to compromise or settle any Third-Party Claim, the other Party shall use its commercially
reasonable efforts to make available to such Indemnifying Party, upon written request, the former,
current and future directors, officers, employees, other personnel and agents of the members of its
respective Group as witnesses and any books, records or other documents within its control or which
it otherwise has the ability to make available, to the extent that any such person (giving
consideration to business demands of such directors, officers, employees, other personnel and
agents) or books, records or other documents may reasonably be required in connection with such
defense, settlement or compromise, or such prosecution, evaluation or pursuit, as the case may be,
and shall otherwise cooperate in such defense, settlement or compromise, or such prosecution,
evaluation or pursuit, as the case may be.

ARTICLE 9

MISCELLANEOUS

9.1 Assignment. Neither Party shall assign, transfer or otherwise alienate any or all of
its rights or interest under this Agreement without the express prior written consent of the other
Party, which in the case of the consent of ATS, may be granted or withheld in ATS’ sole discretion,
and in the case of the consent of Photowatt, shall not be unreasonably withheld or delayed;
provided, however, that notwithstanding the foregoing, ATS may assign any or all of
its rights or interest under this Agreement to any Affiliate of ATS without the consent of
Photowatt. This Agreement shall be binding upon and inure to the benefit of the parties hereto and
thereto, respectively, and their respective successors and permitted assigns, and any permitted
assignee shall agree to perform the obligations of the assignor of this Agreement. Any attempted
transfer, assignment or alienation in violation of this Section 9.1 shall be invalid and
ineffective ab initio.

9.2 Entire Agreement. This Agreement and the other Separation Agreements constitute the
entire agreement between the Parties with respect to the subject matter hereof and thereof and
supersede (a) all prior oral or written proposals or agreements, (b) all contemporaneous oral
proposals or agreements and (c) all previous negotiations and all other communications or
understandings between the Parties, in each case with respect to the subject matter hereof and
thereof. No reliance is placed on any warranty, representation, opinion, advice or assertion of
fact made either prior to, contemporaneous with, or after entering into this Agreement, or any
amendment or supplement thereto, by any Party to this Agreement or its directors, officers and
agents, to any other Party to this Agreement or its directors, officers and agents except to the
extent that the same has been reduced to writing and included as a term of the Separation
Agreements, and none of the Parties to this Agreement has been induced to enter into this Agreement
or any amendment or supplement by reason of any such warranty, representation, opinion, advice or
assertion of fact. Accordingly, there will be no liability, either in tort (including negligence)
or in Contract, assessed in relation to any such warranty, representation, opinion, advice or
assertion of fact, except to the extent contemplated above.

9.3 No Agency. Nothing in this Agreement or any other Separation Agreement shall
constitute or be deemed to constitute a partnership or joint venture between the Parties or, except

- 31 -

 

to the extent provided in Section 4.02 of the Transitional Services Agreement, constitute or be
deemed to constitute any Party the agent or employee of the other Party for any purpose whatsoever,
and neither Party shall have authority or power to bind the other Party or to contract in the name
of, or create a liability against, the other Party in any way or for any purpose.

9.4 Future Litigation and Other Proceedings. If any member of the Photowatt Group (or any
of its Representatives) or any member of the ATS Group (or any of its Representatives) at any time
after the Separation Time initiates or becomes subject to any Action with respect to which the
Parties have no prior agreements (as to indemnification or otherwise), upon reasonable notice (a)
the Party (and its Group members and its and their respective Representatives) that has not
initiated and is not subject to such Action shall comply, at the other Party’s expense, with any
reasonable requests by the other Party for assistance in connection with such Action (including by
way of provision of information and making available of Representatives as witnesses) and (b) each
Party (and its Representatives) shall, at its own expense, coordinate with the other Party its
strategies and actions with respect to such Action to the extent such coordination would not be
detrimental to its interests and shall comply, at the expense of the requesting Party, with any
reasonable requests of the other Party for assistance in connection therewith (including by way of
provision of information and making available of Representatives as witnesses).

9.5 Further Assurances. On and after the Separation Time, each Party hereto shall cooperate
with the other Party, and without any further consideration, but at the expense of the requesting
Party, to execute and deliver, or use its commercially reasonable efforts to cause to be executed
and delivered, all instruments, including instruments of conveyance, assignment and transfer, and
to make all filings with, and to obtain all consents of, any Governmental Authority or any other
Person under any permit, license, agreement, indenture or other instrument (including any Consents
or consents, approvals, rulings or decisions of any Governmental Authority), and to take all such
other actions as such Party may reasonably be requested to take by any other Party hereto from time
to time, consistent with the terms of this Agreement and the Separation Agreements, in order to
effectuate the provisions and purposes of this Agreement and the Separation Agreements and the
other transactions contemplated hereby and thereby.

9.6 Notices. Any notice, instruction, direction, demand or other communication to any
Party under the terms of this Agreement shall be in writing and shall be deemed properly delivered,
given and received: (a) when delivered by hand; (b) on the day sent by facsimile provided that the
sender has received confirmation of transmission from the recipient as at or prior to 5:00 p.m.
Toronto time on such day; (c) the first Business Day after sent by facsimile (to the extent that
the sender has received confirmation of transmission from the recipient after 5:00 p.m. Toronto
time on the day sent by facsimile); or (d) the next business day after sent by registered mail (at
any time other than during a general discontinuance of postal service due to strike, lockout or
otherwise) or by courier or express delivery service, in any case to the address or facsimile
telephone number set forth beneath the name of such Party below (or to such other address or
facsimile telephone number as such Party shall have specified in a written notice given to the
other Parties hereto):

- 32 -

 

	 	(a)	 	if to ATS, to:

ATS Automation Tooling Systems Inc.

250 Royal Oak Road

Cambridge, Ontario N3H 4R6

Attention: General Counsel

Fax No.: (519) 650-6520

	 	(b)	 	if to Photowatt, to:

Photowatt Technologies, Inc.

25 Reuter Drive

Cambridge, Ontario N3E 1A9

Attention: President and Chief Executive Officer

Fax No.: (519) 650-6535

In the event of a general discontinuance of registered mail service due to strike, lock out or
otherwise, any notice, instruction, direction, demand or other communication will be delivered by
hand, courier or express delivery service or sent by facsimile and will be deemed to have been
received in accordance with this Section.

9.7 Time of Essence. Time is of the essence of this Agreement and the other Separation
Agreements.

9.8 Governing Law. This Agreement shall be construed in accordance with and governed by
the laws of the Province of Ontario and the federal laws of Canada applicable therein.

9.9 Severability. If any term or other provision of this Agreement shall be determined by
a court, administrative agency or arbitrator in any jurisdiction to be invalid, illegal or
unenforceable, such invalidity, illegality or unenforceability shall not render the entire
Agreement invalid and shall not affect the validity, legality or enforceability of such term or
other provision in any other jurisdiction. Rather, this Agreement shall be construed as if not
containing the particular invalid, illegal or unenforceable provision, and all other provisions of
this Agreement shall nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner materially adverse
to either Party. Upon such determination that any term or other provision is invalid, illegal or
unenforceable, the Parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the Parties as closely as possible in an acceptable manner to the end that
the transactions contemplated hereby are fulfilled to the fullest extent permitted under applicable
Law.

9.10 Force Majeure. No Party shall be deemed in default of this Agreement to the extent
that any delay or failure in the performance of its obligations under this Agreement results from
any cause beyond its reasonable control, such as acts of God, decrees or restraints of any
Governmental Authority, acts of civil or military authority, embargoes, epidemics, war, riots,

- 33 -

 

insurrections, fires, explosions, earthquakes, floods, unusually severe weather conditions, strikes
or other labour disturbances or unavailability of parts, or, in the case of computer systems, any
failure in electrical or air conditioning equipment, and any other cause or causes whether similar
or dissimilar to those already specified, which cannot be controlled by such Party. In the event
of any such excused delay, the time for performance shall be extended for a period equal to the
time lost by reason of the delay; provided however that the Party seeking to excuse its performance
shall promptly notify the other Party of the cause therefor, such performance shall be so excused
during the inability of the Party to perform so caused, but for no longer period, and the cause
thereof shall be remedied as far as is commercially reasonable with all reasonable dispatch.

9.11 Publicity. Prior to the Separation Time, each of the Parties shall consult with each
other prior to issuing any press releases or otherwise making public statements with respect to the
Offering or any of the other transactions contemplated hereby and prior to making any filings with
any Governmental Authority with respect thereto.

9.12 Specific Performance. In the event of any actual or threatened default in, or breach
of, any of the terms, conditions and provisions of this Agreement or any other Separation
Agreement, the Party or Parties who are or are to be thereby aggrieved shall have the right to
specific performance and injunctive or other equitable relief of its rights under this Agreement or
such Separation Agreement, in addition to any and all other rights and remedies at law or in
equity, and all such rights and remedies shall be cumulative. The Parties agree that the remedies
at law for any breach or threatened breach, including monetary damages, are inadequate compensation
for any loss and that any defense in any action for specific performance that a remedy at law would
be adequate is waived. Any requirements for security or posting of any bond with such remedy are
waived.

9.13 Currency. Except as expressly provided in this Agreement, all amounts in this
Agreement are stated and will be paid in Canadian currency.

9.14 Time Periods. Unless otherwise specified, time periods within or following which any
payment is to be made or act is to be done shall be calculated by excluding the day on which the
period commences and including the day on which the period ends.

9.15 Amendment. This Agreement may only be modified, amended by, altered or supplemented
by the execution and delivery of a written agreement executed by both the Parties.

9.16 Counterparts. This Agreement may be executed in separate counterparts, each of which
shall be deemed an original and all of which, when taken together, shall constitute one and the
same agreement.

9.17 Authority. Each Party represents to the other Party that (a) it has the corporate
power and authority to execute, deliver and perform this Agreement and the other Separation
Agreements, (b) the execution, delivery and performance of this Agreement by it have been duly
authorized by all necessary corporate or other actions, (c) it has duly and validly executed and
delivered this Agreement and the other Separation Agreements and (d) this Agreement and each of the
Separation Agreements is legal, valid and binding obligation, enforceable against it in

- 34 -

 

accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting creditors’ rights generally and general equitable principles.

9.18 Jurisdiction. If any Dispute arises out of or in connection with this Agreement or
any other Separation Agreement, except as expressly contemplated by another provision of this
Agreement or any Separation Agreement, the Parties irrevocably (and the Parties shall cause each
other member of their respective Group to irrevocably) (a) consent and submit to the exclusive
jurisdiction of the Courts of the Province of Ontario, (b) waive any objection to that choice of
forum based on venue or to the effect that the forum is not convenient, and (c) WAIVE TO THE
FULLEST EXTENT PERMITTED BY LAW ANY AND ALL RIGHT TO TRIAL OR ADJUDICATION BY JURY.

9.19 Dispute Resolution. Any controversy or claim, whether based on Contract, tort, Law or
other legal or equitable theory (including any claim of fraud, misrepresentation or fraudulent
inducement or any question of validity or effect of this Agreement or any other Separation
Agreement, including this Section 9.19) (in each such case, a “Dispute”) arising out of or
related to this Agreement or any other Separation Agreement, or the breach or termination thereof,
shall be submitted in good faith to negotiations and, if necessary, mediation in accordance with
the terms below before any Action is commenced.

	 	(a)	 	Direct Negotiation. If either Party considers that any Dispute has
arisen under or in connection with this Agreement, then such Party may first deliver a
notice to the other Party describing the nature and the particulars of such Dispute.
Second, within 10 Business Days following delivery of such notice to the other Party,
or the expiry of the time for delivery of response to the Claim Notice under
Section 8.4(b) hereof, whichever occurs first, the Parties shall meet (whether
by phone or in person) in a good faith attempt to resolve the Dispute. Third, if the
Dispute is still unresolved after 10 Business Days following the commencement of such
good faith attempt, then the chief financial officer (or another designee with full
authority to resolve such dispute) of each Party shall meet (whether by phone or in
person) in a good faith attempt to resolve the Dispute, such meeting to be held within
20 days of the first meeting referred to above. Fourth, if the Dispute is still
unresolved after 10 Business Days following the commencement of such second
negotiations, then such Dispute shall be submitted to mediation in accordance with
Section 9.19(b).
	 
	 	(b)	 	Mediation. If the Dispute is to be submitted to mediation in
accordance with Section 9.19(a), the mediator will be selected by mutual
agreement of the Parties, which agreement shall be reached in good faith and on a
timely basis. If they are unable to agree on a mediator, each Party will select one
third party representative, each of whom shall be an independent experienced
professional mediator practicing in Ontario, which two representatives shall mutually
select a mediator for such Dispute with the same qualifications referred to above (and
each Party shall in good faith instruct its representative to work in good faith with
the other Party’s representative to promptly select such mediator).

- 35 -

 

	 	(i)	 	Mediation Procedure. The mediation will be
conducted pursuant to the rules generally used by the mediator in the
mediator’s practice, subject to the following:

	 	(A)	 	The mediator will act as an advocate for
resolution and will use his or her best efforts to assist the Parties
in reaching a mutually acceptable settlement. The mediator may suggest
ways of resolving the Dispute, but may not impose his or her own
judgment on the issues or that of the Parties. The mediator will not
have the authority to decide any issue for the Parties, but will
attempt to facilitate the voluntary resolution of the Dispute by the
Parties.
	 
	 	(B)	 	Each Person participating in the mediation
will have authority to settle, and all Persons necessary to the
decision to settle will be present during the entire mediation session
or sessions.
	 
	 	(C)	 	The mediation will take place at a time and
convenient location agreeable to the mediator and the Parties, as the
mediator will determine, but such mediation will take place no later
than 20 Business Days after the commencement of the second
negotiations under Section 9.19(a) and will take place over
two consecutive days.
	 
	 	(D)	 	Mediation sessions will be private, and only
the Parties and their representatives may attend the mediation
sessions. Other Persons may attend the mediation sessions only with
the written permissions of the Parties and with the consent of the
mediator.
	 
	 	(E)	 	There will be no stenographic record of the
mediation process, and no Person will tape record any portion of the
mediation sessions.
	 
	 	(F)	 	No subpoenas, summons, complaints, citations,
writs, or other process may be served at or away from the site of any
mediation session upon any Person who then is entering, on the way to,
in attendance or leaving the session.
	 
	 	(G)	 	The Parties will participate in the mediation
proceeding in good faith with the intention to settle.
	 
	 	(H)	 	No later than five days prior to the
mediation, each Party will deliver to the mediator all information
reasonably required for the mediator to understand the issues
presented and a confidential memorandum (not to exceed five pages with
normal type size and margins) setting forth the following:

	 	i.	 	identification of the matters
in dispute;

- 36 -

 

	 	ii.	 	concise statement of points
(factual, legal, practical) that such Party believes enhances
its chance of achieving a favourable outcome of the Dispute;
and
	 
	 	iii.	 	history of settlement
discussions and outstanding offers of settlement.

	 	(I)	 	The above rules may be modified or amended
with the Parties’ written consent.

	 	(ii)	 	Release. The mediator will not be a
necessary or proper party in any Action relating to the mediation. Neither
the mediator, the Person employing the mediator, nor the Person providing
the mediator will be liable to any Party for any acts or omissions in
connection with any mediation conducted pursuant to this Section
9.19.
	 
	 	(iii)	 	Compromise Negotiation. The mediation is a
compromise negotiation for purposes of the applicable rules of evidence
and is an alternative dispute resolution procedure subject to Law chosen
to govern this Agreement. The entire procedure is and will be
confidential. All conduct, statements, promises, offers, views and
opinions, whether oral or written, made in the course of the mediation by
any of the Parties, their agents, employees or other representatives and
by the mediator, who is the Parties’ joint agent for purposes of these
compromise negotiations, are confidential and will, in addition where
appropriate, be deemed to be work product and privileged. Such conduct,
statements, promises, offers, views and opinions will not be discoverable
or admissible for any purposes, including impeachment, if any litigation
or other proceedings involve the Parties and will not be disclosed to
anyone not an agent, employee, expert or other representative for any of
the Parties. Evidence otherwise discoverable or admissible is not excluded
from discovery or admission as a result of its use in the mediation.
Confidential Information disclosed to the mediator by the Parties or by
witnesses in the course of the mediation will not be divulged by the
mediator. All records, reports or other documents received by the mediator
while serving in that capacity will be confidential. The mediator will not
be compelled to divulge such records or to testify with regard to the
mediation in any adversary proceeding or judicial forum.
	 
	 	(iv)	 	Costs of Mediation. The Parties will bear
their respective costs incurred in connection with the mediation described
in this Section 9.19, except that the Parties will share equally
the fees and expenses of the mediator, the costs of obtaining the facility
for the mediation, and the fees and expenses of any experts employed at
the mediator’s request.
	 
	 	(v)	 	Termination of Mediation. The mediation will
be terminated upon the first to occur of the following:

- 37 -

 

	 	(A)	 	by the execution of a settlement agreement
resolving the dispute by the Parties;
	 
	 	(B)	 	by a written declaration of the mediator to
the effect that further efforts at mediation are no longer worthwhile;
or
	 
	 	(C)	 	after the completion of two full days of
mediation sessions, by written declaration of a Party or Parties to
the effect that mediation proceedings are terminated.

	 	(c)	 	Litigation. Neither Party may bring (or have brought) any Action in
any forum with respect to any Dispute arising out of or related to this Agreement or
any other Separation Agreement, or the breach or termination thereof, until such Party
has fully complied with Sections 9.19(a) and (b) with respect to such Dispute.

9.20 Binding Effect. This Agreement and each other Separation Agreement binds and benefits
the Parties and their respective successors and permitted assigns. This Agreement is for the sole
benefit of the Parties (and, solely for purposes of Section 8, ATS Indemnified Persons and
Photowatt Indemnified Persons) and nothing in this Agreement, express or implied, confers or
intends to confer any rights or remedies of any nature whatsoever in favour of any Person
(including any employee or shareholder of ATS or Photowatt) other than the Parties.

9.21 Expenses. Except as otherwise provided in this Agreement or a Separation Agreement,
each Party shall be responsible for its own fees, costs and expenses incurred in connection with
the matters contemplated by this Agreement and the Separation Agreement; provided, however
Photowatt shall be responsible for the payment of all costs, fees and expenses relating to the
Offering and each Party shall be responsible for the payment of all of its costs, fees and expenses
relating to a Spin-Off (or any other divestiture transaction employed by ATS).

9.22 Waiver. A provision of this Agreement or any other Separation Agreement may be waived
only by a writing signed by the Party or Parties intended to be bound by the waiver. A Party is not
prevented from enforcing any right, remedy or condition in the Party’s favour because of any
failure or delay in exercising any right or remedy or in requiring satisfaction of any condition,
except to the extent that the Party specifically waives the same in writing. No waiver of any
provision of this Agreement shall constitute a waiver of any other provision nor shall any waiver
constitute a continuing waiver unless otherwise expressly provided. Any enumeration of a Party’s
rights and remedies in this Agreement or any other Separation Agreement is not intended to be
exclusive, and a Party’s rights and remedies are intended to be cumulative to the extent permitted
by Law and include any rights and remedies authorized in Law or in equity.

9.23 Compliance With Laws. Each Party shall comply with all applicable legal requirements
(including all relevant federal, state and provincial legislation and regulatory requirements); and
without limiting the generality of the foregoing, each Party shall comply with, and shall take all
necessary measures to ensure that (i) its actions (or lack of action) do not result in
non-compliance by the other Party, with the provisions of the Personal Information Protection and
Electronic Documents Act (Canada) and any similar federal, state or provincial

- 38 -

 

legislation, including the provisions relating to the collection, use, retention and disclosure of
Personal Information and (ii) the transfer of any information hereunder is in compliance with
applicable export control or similar Laws.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

- 39 -

 

     IN WITNESS WHEREOF, the Parties have caused this Master Separation Agreement to be signed by
their duly authorized representatives.

	 	 	 	 	 
	 	AUTOMATION TOOLING SYSTEMS INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	 	PHOTOWATT TECHNOLOGIES INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

- 40 -

 

	 	 	 	 	 

EXHIBIT A

Excluded Assets

	1.	 	the premises and building that are the subject of the Lease Agreement.
	 
	2.	 	the investment of ATS in securities of Canadian Solar Inc.
	 
	3.	 	the ATS Solar Automation Know-How.
	 
	4.	 	any tax loss carryforwards, Canadian tax credits or related valuation allowances.
	 
	5.	 	any and all Assets of Matrix Solar Technologies, Inc. not sold, transferred, assigned or
conveyed to Photowatt Technologies USA Inc. pursuant to an asset transfer agreement as between
Matrix Solar Technologies, Inc. and Photowatt Technologies USA Inc. effected prior to the
Separation Time.

- 41 -

 

EXHIBIT B

Included Liabilities

	1.	 	tax liabilities of Matrix Solar Technologies, Inc. in relation to transfer of common shares
in the capital stock of Spheral Solar Power, Inc.
	 
	2.	 	product warranty obligations related to the Existing Photowatt Business or the Photowatt
Business, including warranties related to solar cells and solar modules.

- 42 -PHOTOWATT

 

Exhibit
10.2

MASTER SUPPLY AGREEMENT

between

ATS AUTOMATION TOOLING SYSTEMS INC.

– and –

PHOTOWATT TECHNOLOGIES INC.

[     ],
2007

 

 

MASTER SUPPLY AGREEMENT

THIS
MASTER SUPPLY AGREEMENT (this “Agreement”) is dated
as of  [     ], 2007 (“Effective Date”) by
and between PHOTOWATT TECHNOLOGIES INC., a corporation under the laws of Canada with offices at 25
Reuter Drive, Cambridge, Ontario, N3E 1A9 (“Photowatt”), and ATS AUTOMATION TOOLING SYSTEMS INC., a
corporation under the laws of the Province of Ontario with offices at 250 Royal Oak Road,
Cambridge, Ontario N3H 4R6 (“ATS”).

RECITALS

	 	A.	 	Photowatt is undertaking an initial public offering (the “Offering”) of its
common shares pursuant to a registration statement on Form F-1 under the U.S.
Securities Act of 1933 and a prospectus filed with Canadian provincial and territorial
securities regulatory authorities.
	 
	 	B.	 	Immediately prior to the completion of the Offering, ATS and Photowatt intend
to enter into a Master Separation Agreement (the “Master Separation Agreement”),
containing the key provisions relating to the separation of ATS and Photowatt, and the
other Separation Agreements (as defined in the Master Separation Agreement) providing
for, among other things, the transfer to Photowatt of certain assets of ATS including
the Foil Presses.
	 
	 	C.	 	ATS and/or certain Affiliates of ATS are in the business of providing design,
development, fabrication and testing services (or some combination thereof) in
connection with the development of certain types of machinery or process concepts and
Photowatt and/or certain Affiliates of Photowatt may desire to engage ATS or an
Affiliate of ATS to provide same from time to time on and subject to the terms of this
Agreement.
	 
	 	D.	 	Photowatt wishes to engage ATS to house its Foil Presses and to supply Foil
Products on and subject to the terms of this Agreement.
	 
	 	E.	 	The parties intend in this Agreement and the other Separation Agreements to set
forth the principal arrangements between them regarding the Offering and their
operations thereafter.

 

- 2 -

NOW, THEREFORE, in consideration of the foregoing and the mutual promises, covenants and agreements
set forth below, and for other good and valuable consideration, the receipt and sufficiency of
which the parties hereby acknowledge, the parties agree as follows:

ARTICLE 1

DEFINITIONS AND INTERPRETATION

1.1 Any capitalized term not defined in this Agreement shall have the meaning given such term in
the Master Separation Agreement. The following capitalized terms used in this Agreement shall have
the following meaning:

	 	(a)	 	“Affiliate” means with respect to any entity, any other entity directly or
indirectly controlling or controlled by, or under direct or indirect common control
with, such entity or one or more of the other Affiliates of that entity (or a
combination thereof). For purposes of this definition, an entity shall control another
entity if the first entity (i) owns, beneficially or of record, more than fifty percent
(50%) of the voting securities of the other entity, or (ii) has the ability to elect a
majority of the directors of the other entity.
	 
	 	(b)	 	“ATS Indemnified Parties” has the meaning set out in Section 4.8(a).
	 
	 	(c)	 	“Business Day” means a day other than Saturday, Sunday or other day on which
commercial banks in Toronto, Ontario are authorized or required by law to close.
	 
	 	(d)	 	“Common Shares” means the common shares in the capital of Photowatt at the date
hereof and includes any shares or securities into which such common shares may be
converted or changed or which result from a consolidation, subdivision,
reclassification, stock split, stock dividend, recapitalization or redesignation of the
common shares of Photowatt, any shares or securities of Photowatt which are received as
a stock dividend or distribution in respect of such common shares, any common shares of
Photowatt received on the exercise of any option, warrant or other similar right and
any shares or securities which may be received by the holders of common shares of
Photowatt as a result of an amalgamation, merger, arrangement or other reorganization
of or including Photowatt.
	 
	 	(e)	 	“Cost” means all manufacturing costs including, labour, materials, other direct
costs, and an allocation of indirect and overhead costs.
	 
	 	(f)	 	“Deliverables” mean the tangible documents and equipment that are to be
provided to Photowatt pursuant to the terms of a Project Agreement, which may include
without limitation, reports, designs, equipment, prototypes, computer software, and
documentation. For purposes of clarity, Deliverables exclude Foil Products.
	 
	 	(g)	 	“Foil Presses” has the meaning set out in Section 4.1.
	 
	 	(h)	 	“Foil Products” has the meaning set out in Section 4.1.

 

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	 	(i)	 	“Percentage of Outstanding Common Shares” means the percentage equivalent to
the quotient obtained when (i) the number of Common Shares directly beneficially owned
at the time of the calculation by ATS and its
Affiliates, is divided by (ii) the total number of Common Shares outstanding at the
time of calculation, all quantities being on a non-diluted basis.
	 
	 	(j)	 	“Person” is to be broadly interpreted and includes an individual, a
corporation, a partnership, a trust, an unincorporated organization, a governmental
authority, and the executors, administrators or other legal representatives of an
individual in such capacity.
	 
	 	(k)	 	“Photowatt Indemnified Parties” has the meaning set out in Section
4.8(b).
	 
	 	(l)	 	“Products” means the equipment forming part of the Deliverables with respect to
a particular Project. For purposes of clarity, Products exclude Foil Products and Foil
Presses.
	 
	 	(m)	 	“Project” has the meaning set out in Section 3.1.
	 
	 	(n)	 	“Project Agreement” has the meaning set out in Section 3.1.
	 
	 	(o)	 	“Project Services” means all the services that are to be performed by ATS
pursuant to the terms of a Project Agreement, which may include, without limitation,
general consulting services, design services, and installation services. For purposes
of clarity, Project Services exclude any services provided by ATS pursuant to
Article 4.
	 
	 	(p)	 	“Proprietary Rights” means any and all legal and equitable rights, including
all worldwide copyrights, patent rights, trade secrets, confidential and proprietary
information rights, moral rights, and all rights and title in and to the structure,
sequence, and organization of a work of authorship, and all rights in and to any code,
materials, pictures, interfaces, screen display, and audio visual display or
presentation.
	 
	 	(q)	 	“Specifications” means the design, functional and performance specifications
mutually agreed upon between the parties.

1.2 Construction. If an ambiguity or question of intent or interpretation arises, this Agreement
shall be construed as if drafted jointly by the parties and no presumption or burden of proof shall
arise favouring or disfavouring any party because of the authorship of any provision of this
Agreement. Any reference to any federal, state, provincial, local or foreign law shall be deemed
also to refer to such law as amended and all rules and regulations promulgated thereunder, unless
the context requires otherwise. Any reference to any Contract (including schedules, exhibits and
other attachments thereto), including this Agreement, shall be deemed also to refer to such
Contract as amended, restated or otherwise modified, unless the context requires otherwise. The
words “include,” “includes” and “including” shall be deemed to be followed by “without limitation.”
Pronouns in masculine, feminine and neuter genders shall be

 

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construed to include any other gender,
and words in the singular form shall be construed to include the plural and vice versa, unless the
context requires otherwise. The words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder”
and words of similar import refer to this
Agreement as a whole and not to any particular subdivision unless expressly so limited. Where this
Agreement states that a party “will” or “shall” perform in some manner or otherwise act or omit to
act, it means that such party is legally obligated to do so in accordance with this Agreement. The
word “or” shall not be exclusive. The captions, titles and headings included in this Agreement are
for convenience only and do not affect this Agreement’s construction or interpretation. Any
reference to an Article, Section or Schedule in this Agreement shall refer to an Article or Section
of, or Schedule to, this Agreement, unless the context otherwise requires.

1.3 Conflicts With Other Separation Agreements. To the extent any portion of this Agreement
conflicts with the Master Separation Agreement, the Master Separation Agreement shall control.

ARTICLE 2

RIGHTS OF FIRST REFUSAL AND

PREFERRED SUPPLIER

2.1 Rights of First Refusal. ATS shall have the right of first refusal with respect to any offer
received from any third party or any agreement tentatively reached with any third party to supply
any equipment and related services of the type described in Schedule A hereto (“Offer”). Photowatt
shall promptly provide ATS with a copy of any such Offer. ATS shall have a period of 30 days after
delivery thereof within which to exercise its right of first refusal. The right of first refusal
may be exercised by delivery by ATS to Photowatt of a notice of acceptance. The terms and
conditions of such Offer with respect to price, equipment and services to be supplied, the
specifications thereof and delivery date shall, upon delivery of such notice of acceptance,
thereafter be binding upon ATS and Photowatt and ATS shall supply and Photowatt shall purchase the
equipment and services described in the Offer pursuant to those terms, provided that the terms of
this Agreement shall apply and be incorporated in such Offer and shall collectively constitute a
Project Agreement. If ATS does not exercise its right of first refusal, then Photowatt shall be
free to accept such Offer for the supply of such equipment and related services with the third
party provided that the terms of such Offer may not be revised without first providing the ATS with
its right of first refusal hereunder. Photowatt shall have the right
in its sole discretion to terminate this Section 2.1 and the
right of first refusal of ATS hereunder, by giving notice to ATS, if
ATS fails to perform any of its material obligations with respect to
the supply of any equipment to Photowatt pursuant to the right of
first refusal hereunder on two or more occasions and Photowatt shall
have notified ATS of such failures. In such event, all other
provisions of this Agreement shall remain in full force and effect.
ATS and Photowatt acknowledge that they may agree from time to time
to mutually waive the provisions of this Section 2.1 with
respect to any Offer, in which case Photowatt shall be free to accept
such Offer with the third party provided that the terms of such Offer
may not be revised without first providing ATS with its right of
first refusal hereunder (unless ATS agrees to waive such right).

2.2 Preferred Supplier. With respect to the supply of any equipment and related services of the
nature described in Schedule B hereto, ATS shall be Photowatt’s preferred supplier. If Photowatt
determines to purchase any equipment and related services of the nature described in Schedule B
hereto, then Photowatt shall send a written notice to ATS which shall contain a description of
Photowatt’s requirements with respect to such equipment and related services. Photowatt shall
allow ATS the opportunity to submit a bid with respect to the supply of the equipment and related
services described in such notice in accordance with this Section. If the parties reach agreement
with respect to the supply of such equipment and related services, then such agreement shall
constitute a Project Agreement for the purposes of this Agreement and the terms of this Agreement
shall apply.

 

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ARTICLE 3

PROJECT AGREEMENTS

3.1 Project Agreements

	 	(a)	 	Project Agreements. From time to time during the term of this Agreement
including pursuant to the provisions of Article 2, ATS and Photowatt may agree
in writing that ATS shall provide certain Project Services and/or Deliverables in
connection with a particular project (“Project”) which the parties intend to be
governed by this Agreement. Each such project agreement shall reference this
Agreement, shall be subject to the terms of this Agreement, and shall be referred to
herein as a “Project Agreement”. Any agreements entered into pursuant to Section
2.1 and Section 2.2 shall be deemed to be Project Agreements and shall be
subject to the terms of this Agreement. Each Project Agreement shall be deemed to
include the terms of any quotation provided by ATS unless otherwise expressly provided
for. Any terms on Photowatt’s purchase order, other than terms addressing quantity and
price, shall be void and of no force notwithstanding any delivery under such purchase
order.
	 
	 	(b)	 	Affiliates. Should an Affiliate of a party to this Agreement enter into what
would otherwise be a Project Agreement with the other party to this Agreement or an
Affiliate of such other party, and should the parties to that Project Agreement
reference this Agreement as governing such Project, then the terms of this Agreement
shall apply to the same extent as if the parties to that Project Agreement were parties
to this Agreement and the terms “Photowatt” and “ATS” herein shall be amended as
required for the purposes of such Project Agreement.

3.2 Provision Of Services and Deliverables. Upon the execution or entering into of a Project
Agreement by both parties, ATS shall provide the Services and Deliverables specified in the Project
Agreement in accordance with the terms and conditions of the Project Agreement and the terms and
conditions of this Agreement. ATS shall use commercially reasonable efforts to provide Services
and Deliverables in accordance with any schedule set forth in a Project Agreement, or if no
schedule is set forth in such Project Agreement, in accordance with the schedule otherwise agreed
upon in writing between the parties. All scheduled completion dates are best estimates based on
current projections and based on Photowatt meeting its obligations and ATS shall not be liable for
delays in completion or delivery.

3.3 Price and Payment.

	 	(a)	 	Price and Payment. Photowatt and ATS will mutually agree to pricing for each
Project in the corresponding Project Agreement. Unless otherwise provided for in a
particular Project Agreement, all payments are due within 30 days of receipt of an
invoice from ATS. Photowatt shall pay interest at the prime rate quoted from time to
time by The Bank of Nova Scotia plus 2% on any amounts invoiced by ATS which are not
paid when due.

 

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	 	(b)	 	Taxes. The prices quoted by ATS are exclusive of all applicable federal,
state/provincial or local taxes, unless otherwise stated. Photowatt shall pay the gross
amount of any present or future sales, use, excise, value added, or other similar tax
applicable to the price, sale or delivery of any Product, Project Service or
Deliverable furnished hereunder or to their use by Photowatt. Photowatt shall furnish
ATS with evidence of exemption from any such taxes acceptable to the taxing
authorities. Photowatt shall assess and remit any applicable tax to taxing authorities
not otherwise invoiced by ATS. If any tax in the nature of withholding tax is payable
on any sums invoiced under this Agreement, Photowatt shall pay ATS such amount as is
necessary to ensure that the net amount received by ATS after such withholding shall be
equal to the amount invoiced or otherwise required to be paid herein.

3.4 Design Changes. No changes to the design of a Product from that agreed upon in the Project
Agreement shall be binding unless agreed to in writing by both parties. Any such amendment to a
Project Agreement shall address the impact of such changes on costs and schedule. In the event ATS
agrees to undertake a design study for Photowatt to assess a potential design change, the schedule
for all materials or components affected by the design study shall be extended by a period of time
equal to the hold time, if any, associated with such study, whether or not the parties ultimately
agree to the proposed change.

3.5 Equipment Safety. ATS shall build the Product to comply with ATS’s interpretation of
applicable (OSHA or CSA) safety standards. ATS shall review equipment safety including guarding
designs with Photowatt at a design review meeting with the intent to maximize operator safety,
particularly with respect to all pinch points and moving parts. Photowatt shall advise ATS of any
required equipment safety or guarding changes no later than five (5) days following the date of
such design review meeting. Unless provided for in the Specifications, if Photowatt requests
deviation from ATS’s interpretation of the applicable safety standards, this shall be considered a
design change (See Section 5). ATS may decline any proposed change in the design by
Photowatt, if ATS has concerns regarding safety, reliability, performance or warranty service.

3.6 Photowatt Obligations. Unless otherwise stated in a Project Agreement, Photowatt agrees to
fulfill the following obligations in relation to each Project. Notwithstanding anything to the
contrary contained herein, if the following obligations of Photowatt are not met in a timely
manner, ATS will not be responsible for any impacts to the scope, schedule, budget, or any other
agreed terms and conditions set forth in the Project Agreement:

	 	(a)	 	Photowatt shall provide ATS in a timely manner with:

	 	(i)	 	all information necessary in order to comply
with its obligations under any Project Agreement or reasonably
requested by ATS;
	 
	 	(ii)	 	access to Photowatt’s and its Affiliates’
personnel and appropriate subject matter experts in connection with any
Project;

 

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	 	(iii)	 	all required sample parts or other specified
items required by ATS to design, manufacture, test and install the
Product; and
	 
	 	(iv)	 	clear and unobstructed access to those portions
of Photowatt’s and its Affiliates’ premises required by ATS for
installation of the Product in a condition ready to receive the
Product; and

	 	(b)	 	Any documents submitted to Photowatt for comment or approval by ATS must be
reviewed in a timely manner by Photowatt for accuracy, completeness and conformance to
this Agreement. Failure of Photowatt to advise ATS in writing of material issues
associated with such documents within 5 business days of submission or resubmission
will be considered deemed approval of such documents.

In the event of any delay resulting from Photowatt’s failure to meet these obligations, the date of
delivery or of performance as set out in the applicable Project Agreement shall be extended for a
period equal to the period of such delay. ATS shall not, in such circumstances be liable for any
failure to fulfill any obligations under any Project Agreement and Photowatt shall pay ATS
compensation for the costs actually incurred by reason of such delay, including carrying charges,
transportation charges, storage charges, travel charges, personnel charges and reasonable overhead
and profit thereon.

3.7 Factory Acceptance and Site Acceptance. The following provisions apply with respect to the
acceptance of any Products forming part of the Deliverables:

	 	(a)	 	ATS and Photowatt shall agree in writing upon a test plan (“Test Plan”) within
20 business days of completion of the final designs for the Products, setting out the
criteria to be met, and the testing process to be employed, during the FAT (as defined
below) and the SAT (as defined below).
	 
	 	(b)	 	A factory acceptance test (“FAT”) shall be performed at ATS’s facility or such
facilities of ATS’s subcontractors as may be agreed upon in writing by the parties and
shall commence within five (5) business days of notice from ATS confirming completion
of the Products or at such other time as may be agreed upon in writing by the parties.
Such testing shall be carried out in accordance with the Test Plan. The FAT shall be
deemed successful when the results of the testing are in compliance with the Test
Plan’s criteria.
	 
	 	(c)	 	A Photowatt site acceptance test (“SAT”) shall be performed at Photowatt’s
facility within five (5) business days of the completion of installation of the
Products at Photowatt’s site. Such testing shall be carried out in accordance with the
Test Plan. The SAT shall be deemed successful when the results of the testing are in
compliance with the Test Plan’s criteria.
	 
	 	(d)	 	ATS shall carry out such remedial work as is necessary to achieve a successful
FAT and SAT at no additional charge to Photowatt, provided that any changes

 

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	 	 	 	requested by Photowatt beyond those set forth in the Specifications may require
additional charges which shall be determined by mutual agreement by both parties and
reflected in a change order executed by the parties in accordance with Section
3.4. Once remedial work is complete, the Products will be re-tested and this
process shall continue until a successful FAT and SAT is achieved.

	 	(e)	 	In the event ATS and Photowatt are unable to agree upon a Test Plan within the
time period provided for in sub-section (a) above, the parties shall immediately
escalate the issue within their organizations and, failing agreement within five (5)
business days of when that escalation should have occurred, either party shall have the
right to terminate the applicable Project Agreement upon five (5) days’ notice. In the
event of such termination, Photowatt shall pay ATS for all work performed prior to the
termination, including costs and expenses already incurred and commitments made by ATS
plus reasonable amounts for overhead and profit on the foregoing.
	 
	 	(f)	 	Notwithstanding anything to the contrary, FAT and/or SAT will be deemed
successfully completed in the event that Photowatt fails to conduct the tests within
the prescribed timeframe referred to above or in the event Photowatt does not provide
the production quality sample parts or other inputs required by the Test Plan within
such timeframes.

3.8 Delivery, Title, Risk of Loss and Security. Unless otherwise specified in the applicable
Project Agreement, delivery will be made to Photowatt Ex-Works at point of manufacture, skidded for
domestic truck shipment. Any export or other special packing or special transportation charges
shall be charged to and paid by Photowatt. Except as otherwise provided herein or in the Project
Agreement, ATS shall not be responsible for freight transportation, insurance, shipping, storage,
import duty, brokerage, handling, demurrage, or similar charges. If such charges are by the terms
of sale included in the Project Agreement price, any increase in rates becoming effective after the
date of Project Agreement shall be for the account of and responsibility of Photowatt. Risks of
loss or damage shall pass to Photowatt on delivery to the carrier at ATS’s facility; however, title
to the Product will not pass to Photowatt until payment has been received in full. Without
limiting and in addition to the aforementioned retention of title, Photowatt hereby grants to ATS a
first-priority purchase-money security interest in all goods, general intangibles and other
personal property sold or otherwise supplied by ATS to Photowatt under this Agreement and any
Project Agreement, including, without limitation, the Deliverables under each Project Agreement,
together with all accessions thereto, all replacements thereof and all proceeds therefrom, to
secure payment of all amounts owing by Photowatt to ATS under this Agreement and such Project
Agreements, including the unpaid portion of the purchase price of the goods, general intangibles
and other personal property sold or otherwise supplied by ATS to Photowatt under this Agreement and
any Project Agreement from time to time. ATS shall have authority to make all filings,
registrations and notifications necessary or desirable to protect, preserve and perfect its
security interest and the intended priority thereof. Photowatt agrees that in the event of default
by it of any provision of this Agreement, ATS will have all remedies available to it contemplated
at

 

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law, including those contained in applicable personal property security legislation. This security
is granted in addition to and not in substitution for any other rights and remedies ATS may have
hereunder or otherwise.

3.9 Limited Warranty

	 	(a)	 	ATS warrants that each Product (other than equipment comprising prototypes or
proof of principle equipment) will be free from defects in workmanship and material and
shall materially conform to the Specifications for a period (the “Warranty Period”) of
twelve (12) months from the date of successful completion of SAT of the Product in
Photowatt’s plant or fifteen (15) months from the date of shipment from ATS’s
facilities, whichever occurs first.
	 
	 	(b)	 	During the term of the applicable Project Agreement, ATS warrants that it shall
perform all Project Services provided under the Project Agreement in a workmanlike
manner respecting industry standards and practices for similar services.
	 
	 	(c)	 	Upon prompt notification from Photowatt of any failure of a Product or any
Project Services to conform to these warranties during the applicable warranty period,
ATS will make repairs, adjustments, re-performance or replacements to the defective
part(s) or Project Services at ATS’s option. Where required by ATS, Photowatt agrees
to return a defective part to ATS at Photowatt’s expense. ATS will return corrected or
replacement parts to Photowatt CPT Photowatt’s plant. Photowatt acknowledges that this
sub-section sets forth Photowatt’s exclusive remedy, and ATS’s exclusive liability, for
any breach of these warranties or other duty related to the quality of the Products or
the Project Services.
	 
	 	(d)	 	ATS shall have no responsibility for, and does not warrant against, any
problems that occur as a result of improper use of any Product or failure to properly
install, maintain and operate it in accordance with ATS’s recommended procedures, or
alteration to it by any party other than ATS or those authorized by ATS to do so or any
modifications not made by ATS or problems that result from any accident, vandalism,
mischief or theft. Photowatt shall maintain accurate and complete records regarding
equipment operation and maintenance and service procedures performed on the Product.
	 
	 	(e)	 	ATS’s warranty excludes consumable items and wear parts, such as but not
limited to belts, bulbs, lamps, fuses, o-rings, filters, fiber guides, printer ribbons
or cartridges, lubricants, solvents or chemicals, which by their nature require
periodic replacement.
	 
	 	(f)	 	With respect to third party equipment integrated into the Product, warranties
for such items are limited to the warranty extended to ATS by the third party supplier.
ATS hereby assigns to Photowatt all warranties received from its

 

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	 	 	 	suppliers to the extent ATS is able to and agrees to assist Photowatt in making any
claim pursuant to the said warranties.

ATS MAKES NO OTHER WARRANTY WHATSOEVER WITH RESPECT TO ANY PRODUCTS SUPPLIED UNDER THIS AGREEMENT,
WHETHER EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OR CONDITION OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, ALL OF WHICH ARE DISCLAIMED BY ATS AND WAIVED BY PHOTOWATT.

3.10 Spare Parts

	 	(a)	 	Sixty (60) days prior to the shipment of any Product, ATS shall provide
Photowatt with a list of recommended parts (“Spare Parts”), subject to final
verification by ATS at the time of shipment of the Products, to be stocked by Photowatt
for maintenance of the Products set forth in the applicable Project Agreement, and all
subsequent change orders to such Project Agreements in accordance with this Agreement,
including prices (in effect at such time), lead-time, original equipment manufacturer
(OEM) and OEM part numbers for such parts.
	 
	 	(b)	 	ATS agrees that it will, for a period of five (5) years after the Warranty
Period, make available the necessary resources to service the Products and sell to
Photowatt all necessary Spare Parts, at prevailing price, delivery and payment terms,
required for maintenance and repair of the Products. The parties acknowledge that in
the event that Spare Parts consisting of or including components manufactured by a
third party supplier and not manufactured by ATS cease to be available from such third
party supplier, ATS shall be entitled to identify a suitable replacement or work-around
solution for such Spare Parts. After such five (5) year period has expired, Photowatt
may request that ATS continue to support the Products or supply Spare Parts and, if ATS
does not choose to continue to support such Products or supply such Spare Parts, ATS
agrees to provide Photowatt, upon receipt of a written request from Photowatt
therefore, with an opportunity for Photowatt to make final purchases of any Spare Parts
then in the possession of ATS and supply Photowatt with copies of all manufacturing
drawings of Spare Parts that are manufactured by ATS so that Photowatt can maintain the
Products, provided that Photowatt shall only be able to use such drawings to make or
have made Spare Parts for Products supplied by ATS and for no other purpose.

3.11 Patent Indemnity

	 	(a)	 	ATS agrees that it will, at its own expense, defend any suit instituted against
Photowatt and will indemnify Photowatt against any award of Losses and reasonable costs
made against Photowatt in a final judgment by a court of competent jurisdiction, or any
amount in settlement or compromise thereof, provided that (i) the same is based upon a
claim that any Product infringes a

 

- 11 -

	 	 	 	valid patent under the laws of the United States or Canada; (ii) Photowatt gives ATS
prompt, detailed notice in writing of any such claims asserted; and (iii) Photowatt
permits ATS sole authority through its counsel to defend and/or settle the matter
and Photowatt cooperates and assists with such defense and/or settlement.
	 
	 	(b)	 	In case the Product is, or may become, the subject of any such proceeding, ATS
may, and in the event the Product is held in such suit to constitute an infringement
and its use is enjoined, ATS shall, at its expense and option, either procure for
Photowatt the right to continue to use the Product, or replace same with a
non-infringing product or part, or modify same so it becomes non-infringing, or remove
the Product and refund the purchase price of the infringing part of the Product (less
depreciation for its use on a straight line basis over a period of five (5) years from
the date of the applicable Project Agreement) and any transportation costs shall be
separately paid by Photowatt.
	 
	 	(c)	 	The indemnity obligations shall not apply to the extent a claim for
infringement of third party intellectual property rights relates to (i) any Product or
part which is manufactured to Photowatt’s design; (ii) any Product or part which is
modified by a party other than ATS (ii) any product of a third party as specified by
Photowatt incorporated in the Product; (iii) the use of any Product furnished to
Photowatt in combination with other products not furnished by ATS, unless the Product
furnished by ATS, alone and without combination, infringes the asserted rights; or (iv)
any infringement relating to Photowatt’s prescribed manufacturing processes. As to any
such excluded product or part thereof, ATS assumes no liability whatsoever for
intellectual property right infringement and Photowatt shall hold ATS harmless against
any infringement claim arising therefrom.
	 
	 	(d)	 	These express indemnity obligations shall be ATS’s sole obligation and
Photowatt’s sole remedy in respect to any third party claims of infringement of
intellectual property rights.

3.12 Limitations of Liability and Remedies

	 	(a)	 	Consequential Damages. In no event, whether as a result of breach of contract,
warranty, tort (including negligence) or otherwise, shall ATS or its suppliers or
subcontractors be liable for any special, indirect, consequential, incidental or
punitive damages including, but not limited to, loss of profit or revenues, loss of use
of any Product, any Foil Product or any associated equipment, damage to associated
equipment, cost of capital, cost of substitute products, facilities, services or
replacement equipment, down time costs or claims of Photowatt’s customers for such
damages. If Photowatt transfers title to or leases any Product to any third party,
Photowatt shall obtain from such third party a provision affording ATS and its
suppliers and subcontractors the protection of the preceding sentence.

 

- 12 -

	 	(b)	 	Aggregate Liability. In no event, whether as a result of breach of contract,
warranty, tort (including negligence) or otherwise, shall ATS’s liability to any
Photowatt Indemnified Party for any Losses arising out of, or resulting from the
Products or Project Services furnished hereunder, exceed the amount actually received
by ATS for the specific Product or Project Service which gives rise to the claim.
	 
	 	(c)	 	The remedies provided either party in this Agreement are such party’s sole and
exclusive remedies.

ARTICLE 4

FOIL PRESSES AND FOIL PRODUCTS

4.1 Foil Presses. The parties acknowledge that Photowatt is the owner of two aluminium foil
presses known as the “Systems 1 Press” and the “AMD Press” (the “Foil Presses”) which are located
and installed at the premises of ATS. The AMD Press occupies 2,500 square feet of ATS’s premises
and the Systems 1 Press occupies 5,000 square feet of ATS’s premises. In consideration of ATS
allowing the Foil Presses to be located and installed and operated at ATS’s premises, Photowatt
agrees to pay a charge of $10.00 per square foot per annum occupied by the Foil Presses plus
applicable taxes, payable in advance in monthly instalments on the first day of each calendar month
during the term of this Article 4 without deduction, abatement or set-off. ATS will allow
Photowatt, its Affiliates and its and their respective employees access to ATS’s premises during
normal business hours on reasonable notice in order to be able to use and operate the Systems 1
Press for research and development purposes.

4.2 Foil Products. The parties acknowledge that Photowatt may require ATS to supply it with
aluminium foil processed by the AMD Press in order to manufacture spheral solar products. At such
time as Photowatt is ready to begin to issue firm purchase orders for such products, Photowatt
shall notify ATS. ATS agrees to supply to Photowatt such quantities of aluminium foil processed by
the AMD Press (“Foil Products”) as Photowatt may order from time to time on and subject to the
terms of this agreement and pursuant to firm purchase orders which have been accepted by ATS. The
price payable by Photowatt for Foil Products shall be equal to ATS’s Cost thereof plus 12%. Firm
purchase orders shall be on ATS’s standard form, as amended from time to time. ATS’s supply
obligations under this Section are subject to available labour, supplies, and AMD Press capacity
(any requirement to operate the AMD Press for more than eight hours per day being subject to the
mutual agreement of the parties). Photowatt shall provide ATS with a rolling forecast of aluminium
foil requirements, to be provided on the first day of each month covering the following three
months.

4.3 No Warranty. Recognizing that Photowatt owns the Foil Presses and is responsible for their
maintenance, the Foil Products supplied by ATS to Photowatt hereunder are sold on an “as is” basis
and ATS makes no warranty whatsoever, express or implied, with respect to the Foil Products,
including any warranty of quality, merchantability, fitness for a particular purpose, or conformity
with specifications all of which are disclaimed by ATS and waived by Photowatt.

 

- 13 -

4.4 Terms and Conditions of Sale. Delivery of Foil Products will be made to Photowatt Ex-Works at
point of manufacture, skidded for domestic truck shipment. Any export or other special packing or
special transportation charges shall be charged to and paid by Photowatt. ATS shall not be
responsible for freight transportation, insurance, shipping, storage, import duty, brokerage,
handling, demurrage, or similar charges. Risks of loss or damage shall pass to Photowatt on
delivery to the carrier at ATS’s facility; however, title to Foil Products will not pass to
Photowatt until payment has been received in full. ATS shall not be required to ship Foil Product
during any period where past due amounts are owing under this Agreement.

4.5 Maintenance and Repair. Photowatt shall be responsible to maintain the Foil Presses in good
operating condition at its sole cost and expense and ATS shall provide Photowatt with access to its
premises during normal business hours on reasonable notice for such purpose. Photowatt assumes the
entire risk of loss, theft, destruction or damage to the Foil Presses.

4.6 Invoicing and Settlement of Costs.

	 	(a)	 	ATS shall invoice Photowatt upon shipment of Foil Products, the fees payable by
Photowatt for Foil Products ordered by Photowatt under this Article 4.
	 
	 	(b)	 	Photowatt shall pay to ATS, on or before the 10th day after the date on which
an invoice for Foil Products is delivered to the Photowatt in accordance herewith (or
the next Business Day, if such 10th day is not a Business Day) (each, a “Payment
Date”), by wire transfer of immediately available funds payable to the order of ATS,
all amounts invoiced by ATS pursuant to Section 4.6. Photowatt shall pay
interest at the prime rate as quoted from time to time of The Bank of Nova Scotia plus
2% on any amounts invoiced by ATS which are not paid when due. In the event Photowatt
fails to pay amounts owing under this Article 4 on two or more occasions, ATS
reserves the right to require all future deliveries of Foil Products to be paid C.O.D.
	 
	 	(c)	 	The prices quoted by ATS are exclusive of all applicable federal,
state/provincial or local taxes, unless otherwise stated. Photowatt shall pay the
gross amount of any present or future sales, use, excise, value added, or other similar
tax applicable to the price, sale or delivery of any Product, Foil Product, Project
Service or Deliverable furnished hereunder or to their use by Photowatt. Photowatt
shall furnish ATS with evidence of exemption from any such taxes acceptable to the
taxing authorities. Photowatt shall assess and remit any applicable tax to taxing
authorities not otherwise invoiced by ATS. If any tax in the nature of withholding tax
is payable on any sums invoiced under this Agreement, Photowatt shall pay ATS such
amount as is necessary to ensure that the net amount received by ATS after such
withholding shall be equal to the amount invoiced or otherwise required to be paid
herein.

 

- 14 -

4.7 Limitation of Liability.

	 	(a)	 	Photowatt acknowledges and agrees that (i) ATS is not in the business of
supplying Foil Products to third parties and that the AMD Press has never been used to
manufacture Foil Products on a commercial basis, (ii) ATS has agreed to supply Foil
Products as an accommodation to Photowatt and (iii) ATS makes no representations or
warranties whatsoever, whether express or implied by statute or otherwise, regarding
the Foil Products or any other matters relating to or arising out of this Agreement.
	 
	 	(b)	 	In no event, whether as a result of breach of contract or warranty, tort
(including negligence) or otherwise shall ATS have any liability to any Photowatt
Indemnified Party or any other Person for any Losses arising out of, resulting from or
relating to any Foil Products manufactured on Photowatt’s Foil Presses and supplied to
Photowatt hereunder or for any related services rendered or to be rendered hereunder by
any ATS Indemnified Party, or for their respective actions or inactions hereunder,
except for Losses resulting from the gross negligence or willful misconduct of such ATS
Indemnified Party or its representatives.
	 
	 	(c)	 	Photowatt shall in all circumstances use commercially reasonable efforts to
mitigate and otherwise minimize Losses to the Photowatt Indemnified parties,
individually and collectively, whether direct or indirect, due to, resulting from or
arising in connection with any failure by ATS to comply fully with ATS’s obligations
under this Article 4.
	 
	 	(d)	 	Notwithstanding anything in this Agreement to the contrary, in no event shall
ATS be liable to Photowatt or any other Person for, and Photowatt (on behalf of itself,
its Affiliates and other Photowatt Indemnified parties) hereby releases ATS from all
claims for, special, indirect, consequential, incidental or punitive Losses (including
lost profits or savings), even if advised of their possible existence.
	 
	 	(e)	 	In no event, whether as a result of breach of contract, warranty, tort
(including negligence) or otherwise, shall ATS’s liability for any Losses arising out
of, or resulting from this Article 4, exceed the amount actually received by
ATS for the specific Foil Product or service which gives rise to the claim.

4.8 Indemnification.

	 	(a)	 	Subject to Section 4.7, Photowatt shall indemnify and hold harmless
ATS, its Affiliates and its and their respective directors, officers, employees and
agents (the “ATS Indemnified Parties”) from and against any and all Losses relating to,
arising out of or in connection with the Foil Presses and the Foil Products including
any service rendered or to be rendered by any ATS Indemnified Person pursuant to this
Agreement, any Losses relating or attributable to the manufacture of the Foil Products
by ATS including any Losses resulting from a

 

- 15 -

	 	 	 	defect or failure in the Products, any claim for patent infringement or other
infringement of intellectual property rights relating to the Foil Presses, or any
ATS Indemnified Party’s actions or inactions in connection with any such Foil
Presses and Foil Products, except to the extent resulting from such ATS Indemnified
Party’s gross negligence or willful misconduct.

	 	(b)	 	Subject to Section 4.7, ATS shall indemnify and hold harmless
Photowatt, its Affiliates and its and their respective directors, offices, employees
and agents (the “Photowatt Indemnified Parties”) from and against any and all Losses
relating to, arising out of or in connection with the gross negligence or willful
misconduct of any ATS Indemnified Party in connection with the Foil Products supplied
to Photowatt pursuant to this Agreement.

4.9 Claim Procedure. The claim procedures set forth in Section 8.4 of the Master
Separation Agreement shall apply to indemnification claims under Article 4 of this
Agreement.

4.10 Termination of Article 4. Notwithstanding anything to the contrary in this Agreement, this
Article 4 may be terminated as follows:

	 	(a)	 	the parties may by mutual agreement terminate this Article 4 of this
Agreement, in whole or in part, in accordance with this
  Section 4.10(a);
	 
	 	(b)	 	Photowatt may terminate this Article 4 at any time if ATS shall have
failed to perform any of its material obligations under this Article 4,
Photowatt shall have notified ATS in writing of such failure and such failure shall
have continued unremedied for a period of at least 30 days after receipt by ATS of
written notice of such failure from Photowatt; and
	 
	 	(c)	 	either party shall have the right to terminate its obligations under this
Article 4 by giving at least six months notice to the other party; provided
that ATS shall not be permitted to exercise its termination right until one year from
the Effective Date.

If the term of this Agreement ends pursuant to Section 7.1(b) because the
Percentage of Outstanding Common Shares is less than 10%, then, unless earlier terminated
as provided for above, this Article 4, Article 5 and Article 6
shall continue in full force and effect notwithstanding Section 7.1 until:

	 	(i)	 	eighteen (18) months following the Effective
Date if the event described in Section 7.1(b) occurs during the first
year of the term of this Agreement; and
	 
	 	(ii)	 	six (6) months following the occurrence of the
event described in Section 7.1(b) if such event occurs after the first
year of the term of this Agreement.

 

- 16 -

4.11 Effect of Termination.

	 	(a)	 	Notwithstanding any termination or expiry of this Article 4: (i)
Photowatt shall remain liable to the ATS for any fees payable under this Article
4 which are owed and payable prior to the effective date of such termination; and
(ii) the provisions of Sections 4.7, 4.8, 4.9, 4.11,
Article 5 (Confidentiality and Proprietary Rights) and Article 8
(General) shall survive any such termination.
	 
	 	(b)	 	Following termination of this Agreement, the parties agree to cooperate with
each other in providing for an orderly transition to Photowatt or to a successor
service provider as designated by Photowatt. Without limiting the foregoing, ATS
agrees to cooperate with Photowatt in developing a transition schedule with respect to
the supply of Foil Products.
	 
	 	(c)	 	Upon termination or notice of termination of this Article 4 as
applicable, Photowatt shall at Photowatt’s sole cost and expense cause the Foil Presses
to be de-installed and shall take possession of the Foil Presses and cause the Foil
Presses to be moved and relocated from ATS’s premises. Photowatt also agrees to pay
all of ATS’s costs in restoring its premises to its condition prior to the installation
of the Foil Presses including filling the holes containing the Foil Presses and
installing new flooring. Photowatt shall be permitted a period of 6 months from the
earlier of the date of termination or notice of termination to remove the Foil Presses
and allow sufficient time for remediation, provided Photowatt shall continue to pay a
pro-rata portion of the service charge provided for in Section 4.1 during such
period. Notwithstanding anything to the contrary provided for above, in the event
there are outstanding amounts owing by Photowatt to ATS at the time of termination, ATS
may, at its option, require payment of such amounts before Photowatt is entitled to
remove the Foil Presses.

ARTICLE 5

CONFIDENTIALITY AND PROPRIETARY RIGHTS

5.1 Confidentiality. The parties acknowledge that they are bound by the provisions of Article
6 of the Master Separation Agreement which governs the confidentiality and disclosure of
Information.

5.2 Proprietary Rights

	 	(a)	 	Ownership/License. ATS shall and does irrevocably grant and assign to
Photowatt the Proprietary Rights in and to any and all of the Deliverables first
developed or conceived during performance of and otherwise resulting from this
Agreement other than those that constitute ATS Proprietary Technology (as defined
below) effective upon full payment for such Deliverables. Notwithstanding any
provision, express or implied, to the contrary, and for the purposes of clarity, the
parties confirm that ATS shall retain all Proprietary Rights to any ATS Proprietary
Technology forming part of the Deliverables

 

- 17 -

	 	 	 	under the Agreement. “ATS Proprietary Technology” means any and all technology,
know-how, trade secrets, inventions, and software and other intellectual property
that: (i) was developed or conceived by ATS prior to or outside the scope of this
Agreement, or (ii) is owned by a third party and that ATS has obtained rights to
independently of this Agreement, or (iii) is developed or conceived during the
course of performance under this Agreement (“New Developments”), to the extent such
New Developments relate to mechanical and electronic devices used to automatically
convey, grip, locate, orient, connect, manipulate, alter, form, inspect, test or
sense materials or products as part of a manufacturing process. Photowatt shall
have and ATS hereby grants to Photowatt, an irrevocable, non-exclusive, world-wide,
royalty-free, perpetual right and license to use such ATS Proprietary Technology as
has been incorporated into the Deliverables solely to operate, modify, and maintain
the Deliverables provided under the Agreement.
	 
	 	(b)	 	Software. The Product may use computer software. Computer software that is
custom developed by ATS specifically for Photowatt under the terms of the Agreement
(“Custom Software”) shall be delivered to Photowatt with the Product, including source
code. All title, right and interest in the copyright to such Custom Software shall
vest in Photowatt upon full payment for the Product and form part of the Deliverables.
Computer software of third party suppliers (“Third Party Software”) may also be
integrated into the Product. To the extent possible, ATS shall assign all rights
afforded under the licenses for such Third Party Software to Photowatt and Photowatt
shall assume all obligations under any such software licenses. The Deliverables may
also include software that has been developed by ATS, at ATS’s expense, for general use
in the products ATS manufactures (“ATS Software”). ATS Software is proprietary to ATS.
Upon full payment for the Product, such ATS Software shall be licensed to Photowatt on
a non-exclusive basis for use solely to operate and maintain the Product by Photowatt.
For certainty, unless the Project Agreement specifically contemplates and identifies
software as Custom Software to be developed for and owned by Photowatt, software
developed by ATS and included in the Deliverables shall be ATS Software.

ARTICLE 6

INSURANCE

6.1 Insurance. ATS and Photowatt will maintain in effect during the term of this Agreement the
following insurance coverage:

	 	(a)	 	worker’s compensation and employer’s liability Insurance providing for the
payment of benefits to and for the account of employees employed in connection with the
performances of any obligations hereunder; and
	 
	 	(b)	 	one or more policies of comprehensive general liability agreement from a
recognized, major insurance company qualified to do business in the Province of

 

- 18 -

	 	 	 	Ontario and naming the other party as an additional insured. Such policy shall
include a product liability endorsement covering personal injury and property damage
claims, suits and actions, effective for occurrences caused by accidents or other
incidents involving the products and services provided hereunder on or after the
date hereof. Such policy shall provide limits of liability per occurrence and other
terms which ATS from time to time considers satisfactory (initially, such policy
shall have a combined single limit for bodily injury and property damage of at least
$10,000,000.00. From time to time as requested by either party hereto, the other
party shall promptly deliver evidence satisfactory to the requesting party that such
insurance is in full force and effect.

ARTICLE 7

TERM AND TERMINATION

7.1 Term. Unless earlier terminated as provided for in this Agreement and subject to Section
4.10, the term of this Agreement shall commence on the Effective Date and continue thereafter until
the earlier of:

	 	(a)	 	five (5) years from the Effective Date; and
	 
	 	(b)	 	such time as the Percentage of Outstanding Common Shares is less than 10%.

7.2 Termination of Project Agreement by Photowatt for Convenience. Photowatt may terminate a
Project Agreement (other than Article 4) in whole or in part for Photowatt’s convenience
upon ten (10) days’ written notice to ATS. In the event of such termination, Photowatt shall pay
ATS upon demand for all costs and expenses already incurred or commitments made by ATS for
materials and labour, including, without limitation, design, processing, handling, fabrication,
packing, shipping, travel, supplier termination, and restocking charges, plus reasonable amounts
for overhead and profit through to the effective date of termination. ATS shall not be entitled to
anticipated profit or anticipated overhead charges for the balance of the Project.

7.3 Termination by ATS for Cause. If Photowatt becomes insolvent or bankrupt or breaches a
material provision hereof and does not commence to remedy such breach within ten (10) calendar days
of written notice by ATS, ATS may terminate the Agreement in whole or in part effective ten (10)
calendar days after said notice was given. In the event of such termination, in addition to any
other rights ATS may have hereunder or otherwise, ATS shall have the right to take possession of
any Foil Products at an ATS site, as well as the Deliverables and all materials and components
related to the Deliverables in whatever stage of design, manufacture, or installation they are at
such time, except any Deliverables which have already been delivered to and paid for in full by
Photowatt. ATS shall be under no obligation to finish the work, provide further support or
information, or provide further Deliverables. In the event of such termination, Photowatt shall
pay ATS for all work performed prior to the termination, including costs and expenses already
incurred and commitments made by ATS plus reasonable expenses incurred after termination to recover
or protect the Deliverables, plus reasonable

 

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amounts for overhead and profit on the foregoing. ATS shall not be entitled to compensation for
anticipated profit or anticipated overhead charges.

7.4 Termination by Photowatt for Cause.

	 	(a)	 	If ATS becomes bankrupt or insolvent or breaches a material provision hereof
and does not commence to remedy such breach within ten (10) calendar days of being
given written notice by Photowatt, Photowatt may terminate the Agreement in whole or in
part effective ten (10) calendar days after such notice was given. In the event of
such termination, Photowatt shall take possession of the Deliverables (in whatever
state of design or manufacture they are at such time) immediately and shall have a
right to receive a refund of all amounts paid to ATS by Photowatt hereunder, less an
amount representing payment for all work performed and deliverables provided by ATS to
the date of such termination. ATS shall not be entitled to anticipated profit or
anticipated overhead charges. Upon such payment, Photowatt shall have the right to the
continued use of the Deliverables then delivered.
	 
	 	(b)	 	THE REMEDY PROVIDED TO PHOTOWATT IN THIS ARTICLE SHALL BE PHOTOWATT’S SOLE AND
EXCLUSIVE REMEDY IN RESPECT OF ANY BANKRUPTCY OR INSOLVENCY OF ATS AND, EXCEPT AS
EXPRESSLY OTHERWISE PROVIDED IN THIS AGREEMENT, IN RESPECT OF ANY BREACH OF THIS
AGREEMENT BY ATS.

ARTICLE 8

MISCELLANEOUS

8.1 Assignment. Neither party shall assign, transfer or otherwise alienate any or all of its
rights or interest under this Agreement without the express prior written consent of the other
party, which may be granted or withheld in such other party’s sole discretion. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns, and any permitted assignee shall agree to perform the obligations
of the assignor of this Agreement. Any attempted transfer, assignment or alienation in violation of
this Section 8.1 shall be invalid and ineffective ab initio.

8.2 Entire Agreement. This Agreement and the other Separation Agreements constitute the entire
agreement between the parties with respect to the subject matter hereof and thereof and supersede
(a) all prior oral or written proposals or agreements, (b) all contemporaneous oral proposals or
agreements and (c) all previous negotiations and all other communications or understandings between
the parties, in each case with respect to the subject matter hereof and thereof. No reliance is
placed on any warranty, representation, opinion, advice or assertion of fact made either prior to,
contemporaneous with, or after entering into this Agreement, or any amendment or supplement
thereto, by any party to this Agreement or its directors, officers and agents, to any other party
to this Agreement or its directors, officers and agents except to the extent that the same has been
reduced to writing and included as a term of the Separation Agreements, and none of the parties to
this Agreement has been induced to enter

 

- 20 -

into this Agreement or any amendment or supplement by reason of any such warranty, representation,
opinion, advice or assertion of fact. Accordingly, there will be no liability, either in tort
(including negligence) or in Contract, assessed in relation to any such warranty, representation,
opinion, advice or assertion of fact, except to the extent contemplated above.

8.3 Future Litigation and Other Proceedings. If any member of the Photowatt Group (or any of its
Representatives) or any member of the ATS Group (or any of its Representatives) at any time after
the Effective Date initiates or becomes subject to any Action with respect to which the parties
have no prior agreements (as to indemnification or otherwise), upon reasonable notice (a) the party
(and its Group members and its and their respective Representatives) that has not initiated and is
not subject to such Action shall comply, at the other party’s expense, with any reasonable requests
by the other party for assistance in connection with such Action (including by way of provision of
information and making available of Representatives as witnesses) and (b) each party (and its
Representatives) shall, at its own expense, coordinate with the other party its strategies and
actions with respect to such Action to the extent such coordination would not be detrimental to its
interests and shall comply, at the expense of the requesting party, with any reasonable requests of
the other party for assistance in connection therewith (including by way of provision of
information and making available of Representatives as witnesses).

8.4 Further Assurances. On and after the date of this Agreement, each party hereto shall cooperate
with the other party, and without any further consideration, but at the expense of the requesting
party, to execute and deliver, or use its commercially reasonable efforts to cause to be executed
and delivered, all instruments, including instruments of conveyance, assignment and transfer, and
to make all filings with, and to obtain all consents of, any Governmental Authority or any other
Person under any permit, license, agreement, indenture or other instrument (including any Consents
or consents, approvals, rulings or decisions of any Governmental Authority), and to take all such
other actions as such party may reasonably be requested to take by any other party hereto from time
to time, consistent with the terms of this Agreement, in order to effectuate the provisions and
purposes of this Agreement and the other transactions contemplated hereby.

8.5 Notices. Any notice, instruction, direction, demand or other communication to any party under
the terms of this Agreement shall be in writing and shall be deemed properly delivered, given and
received: (a) when delivered by hand; (b) on the day sent by facsimile provided that the sender has
received confirmation of transmission from the recipient as at or prior to 5:00 p.m. Toronto time
on such day; (c) the first Business Day after sent by facsimile (to the extent that the sender has
received confirmation of transmission from the recipient after 5:00 p.m. Toronto time on the day
sent by facsimile); or (d) the next business day after sent by registered mail (at any time other
than during a general discontinuance of postal service due to strike, lockout or otherwise) or by
courier or express delivery service, in any case to the address or facsimile telephone number set
forth beneath the name of such party below (or to such other address or facsimile telephone number
as such party shall have specified in a written notice given to the other parties hereto):

	 	(1)	 	if to ATS, to:

 

- 21 -

	 	 	 	ATS Automation Tooling Systems Inc.

250 Royal Oak Road

Cambridge, Ontario N3H 4R6

Attention: General Counsel

Fax No.:    (519) 650-6520
	 
	 	(2)	 	if to Photowatt, to:
	 
	 	 	 	Photowatt Technologies, Inc.

25 Reuter Drive

Cambridge, Ontario N3E 1A9
	 
	 	 	 	Attention: President and Chief Executive Officer

Fax No.:    (519) 650-6535

In the event of a general discontinuance of registered mail service due to strike, lock out or
otherwise, any notice, instruction, direction, demand or other communication will be delivered by
hand, courier or express delivery service or sent by facsimile and will be deemed to have been
received in accordance with this Section.

8.6 Time of Essence. Time is of the essence of this Agreement.

8.7 Governing Law. This Agreement shall be construed in accordance with and governed by the laws
of the Province of Ontario and the federal laws of Canada applicable therein.

8.8 Severability. If any term or other provision of this Agreement shall be determined by a court,
administrative agency or arbitrator in any jurisdiction to be invalid, illegal or unenforceable,
such invalidity, illegality or unenforceability shall not render the entire Agreement invalid and
shall not affect the validity, legality or enforceability of such term or other provision in any
other jurisdiction. Rather, this Agreement shall be construed as if not containing the particular
invalid, illegal or unenforceable provision, and all other provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially adverse to either party.
Upon such determination that any term or other provision is invalid, illegal or unenforceable, the
parties shall negotiate in good faith to modify this Agreement so as to effect the original intent
of the parties as closely as possible in an acceptable manner to the end that the transactions
contemplated hereby are fulfilled to the fullest extent permitted under applicable Law.

8.9 Force Majeure. No party shall be deemed in default of this Agreement to the extent that any
delay or failure in the performance of its obligations under this Agreement results from any cause
beyond its reasonable control, such as acts of God, decrees or restraints of any Governmental
Authority, acts of civil or military authority, embargoes, epidemics, war, riots, insurrections,
fires, explosions, earthquakes, floods, unusually severe weather conditions, strikes or other
labour disturbances or unavailability of parts, or, in the case of computer

 

- 22 -

systems, any failure in electrical or air conditioning equipment, and any other cause or causes
whether similar or dissimilar to those already specified, which cannot be controlled by such party.
In the event of any such excused delay, the time for performance shall be extended for a period
equal to the time lost by reason of the delay; provided however that the party seeking to excuse
its performance shall promptly notify the other party of the cause therefor, such performance shall
be so excused during the inability of the party to perform so caused, but for no longer period, and
the cause thereof shall be remedied as far as is commercially reasonable with all reasonable
dispatch.

8.10 Specific Performance. In the event of any actual or threatened default in, or breach of, any
of the terms, conditions and provisions of this Agreement, the party or parties who are or are to
be thereby aggrieved shall have the right to specific performance and injunctive or other equitable
relief of its rights under this Agreement, in addition to any and all other rights and remedies at
law or in equity, and all such rights and remedies shall be cumulative. The parties agree that the
remedies at law for any breach or threatened breach, including monetary damages, are inadequate
compensation for any loss and that any defense in any action for specific performance that a remedy
at law would be adequate is waived. Any requirements for security or posting of any bond with such
remedy are waived.

8.11 Currency. Except as expressly provided in this Agreement, all amounts in this Agreement are
stated and will be paid in Canadian currency.

8.12 Time Periods. Unless otherwise specified, time periods within or following which any payment
is to be made or act is to be done shall be calculated by excluding the day on which the period
commences and including the day on which the period ends.

8.13 Amendment. This Agreement may only be modified, amended by, altered or supplemented by the
execution and delivery of a written agreement executed by both the parties.

8.14 Counterparts. This Agreement may be executed in separate counterparts, each of which shall be
deemed an original and all of which, when taken together, shall constitute one and the same
agreement.

8.15 Authority. Each party represents to the other party that (a) it has the corporate power and
authority to execute, deliver and perform this Agreement, (b) the execution, delivery and
performance of this Agreement by it have been duly authorized by all necessary corporate or other
actions, (c) it has duly and validly executed and delivered this Agreement and (d) this Agreement
is legal, valid and binding obligation, enforceable against it in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors’ rights generally and general equitable principles.

8.16 Jurisdiction. If any Dispute arises out of or in connection with this Agreement, except as
expressly contemplated by another provision of this Agreement, the parties irrevocably (and the
parties shall cause each other member of their respective Group to irrevocably) (a) consent and
submit to the exclusive jurisdiction of the Courts of the Province of

 

- 23 -

Ontario, (b) waive any objection to that choice of forum based on venue or to the effect that the
forum is not convenient, and (c) WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY AND ALL RIGHT TO
TRIAL OR ADJUDICATION BY JURY.

8.17 Dispute Resolution. Any controversy or claim, whether based on Contract, tort, Law or other
legal or equitable theory (including any claim of fraud, misrepresentation or fraudulent inducement
or any question of validity or effect of this Agreement, including this Section 8.17) (in
each such case, a “Dispute”) arising out of or related to this Agreement, or the breach or
termination thereof, shall be submitted in good faith to negotiations and, if necessary, mediation
in accordance with the terms below before any Action is commenced.

	 	(a)	 	Direct Negotiation. If either party considers that any Dispute has
arisen under or in connection with this Agreement, then such party may first deliver a
notice to the other party describing the nature and the particulars of such Dispute.
Second, within 10 Business Days following delivery of such notice to the other party,
the parties shall meet (whether by phone or in person) in a good faith attempt to
resolve the Dispute. Third, if the Dispute is still unresolved after 10 Business Days
following the commencement of such good faith attempt, then the chief financial officer
(or another designee with full authority to resolve such dispute) of each party shall
meet (whether by phone or in person) in a good faith attempt to resolve the Dispute,
such meeting to be held within 20 days of the first meeting referred to above. Fourth,
if the Dispute is still unresolved after 10 Business Days following the commencement of
such second negotiations, then such Dispute shall be submitted to mediation in
accordance with Section 8.17(b).
	 
	 	(b)	 	Mediation. If the Dispute is to be submitted to mediation in
accordance with Section 8.17(a), the mediator will be selected by mutual
agreement of the parties, which agreement shall be reached in good faith and on a
timely basis. If they are unable to agree on a mediator, each party will select one
third party representative, each of whom shall be an independent experienced
professional mediator practicing in Ontario, which two representatives shall mutually
select a mediator for such Dispute with the same qualifications referred to above (and
each party shall in good faith instruct its representative to work in good faith with
the other party’s representative to promptly select such mediator).

	 	(i)	 	Mediation Procedure. The mediation
will be conducted pursuant to the rules generally used by the mediator
in the mediator’s practice, subject to the following:

	 	(A)	 	The mediator will act as an
advocate for resolution and will use his or her best efforts
to assist the parties in reaching a mutually acceptable
settlement. The mediator may suggest ways of resolving the
Dispute, but may not impose his or her own judgment on the
issues or that of the parties. The mediator will not have the
authority to decide any issue for the parties, but will
attempt to

 

- 24 -

	 	 	 	facilitate the voluntary resolution of the Dispute by the
parties.
	 
	 	(B)	 	Each Person participating in
the mediation will have authority to settle, and all Persons
necessary to the decision to settle will be present during the
entire mediation session or sessions.
	 
	 	(C)	 	The mediation will take place
at a time and convenient location agreeable to the mediator
and the parties, as the mediator will determine, but such
mediation will take place no later than 20 Business Days after
the commencement of the second negotiations under Section
8.17(a) and will take place over two consecutive days.
	 
	 	(D)	 	Mediation sessions will be
private, and only the parties and their representatives may
attend the mediation sessions. Other Persons may attend the
mediation sessions only with the written permissions of the
parties and with the consent of the mediator.
	 
	 	(E)	 	There will be no stenographic
record of the mediation process, and no Person will tape
record any portion of the mediation sessions.
	 
	 	(F)	 	No subpoenas, summons,
complaints, citations, writs, or other process may be served
at or away from the site of any mediation session upon any
Person who then is entering, on the way to, in attendance or
leaving the session.
	 
	 	(G)	 	The parties will participate
in the mediation proceeding in good faith with the intention
to settle.
	 
	 	(H)	 	No later than five days prior
to the mediation, each party will deliver to the mediator all
information reasonably required for the mediator to understand
the issues presented and a confidential memorandum (not to
exceed five pages with normal type size and margins) setting
forth the following:

	 	i.	 	identification of the matters in dispute;
	 
	 	ii.	 	concise
statement of points (factual, legal, practical) that
such party believes enhances its chance of achieving
a favourable outcome of the Dispute; and

 

- 25 -

	 	iii.	 	history
of settlement discussions and outstanding offers of
settlement.

	 	(I)	 	The above rules may be
modified or amended with the parties’ written consent.

	 	(ii)	 	Release. The mediator will not be a
necessary or proper party in any Action relating to the mediation.
Neither the mediator, the Person employing the mediator, nor the Person
providing the mediator will be liable to any party for any acts or
omissions in connection with any mediation conducted pursuant to this
Section 8.17.
	 
	 	(iii)	 	Compromise Negotiation. The mediation
is a compromise negotiation for purposes of the applicable rules of
evidence and is an alternative dispute resolution procedure subject to
Law chosen to govern this Agreement. The entire procedure is and will
be confidential. All conduct, statements, promises, offers, views and
opinions, whether oral or written, made in the course of the mediation
by any of the parties, their agents, employees or other representatives
and by the mediator, who is the parties’ joint agent for purposes of
these compromise negotiations, are confidential and will, in addition
where appropriate, be deemed to be work product and privileged. Such
conduct, statements, promises, offers, views and opinions will not be
discoverable or admissible for any purposes, including impeachment, if
any litigation or other proceedings involve the parties and will not be
disclosed to anyone not an agent, employee, expert or other
representative for any of the parties. Evidence otherwise discoverable
or admissible is not excluded from discovery or admission as a result
of its use in the mediation. Confidential Information disclosed to the
mediator by the parties or by witnesses in the course of the mediation
will not be divulged by the mediator. All records, reports or other
documents received by the mediator while serving in that capacity will
be confidential. The mediator will not be compelled to divulge such
records or to testify with regard to the mediation in any adversary
proceeding or judicial forum.
	 
	 	(iv)	 	Costs of Mediation. The parties will
bear their respective costs incurred in connection with the mediation
described in this Section 8.17, except that the parties will
share equally the fees and expenses of the mediator, the costs of
obtaining the facility for the mediation, and the fees and expenses of
any experts employed at the mediator’s request.
	 
	 	(v)	 	Termination of Mediation. The mediation
will be terminated upon the first to occur of the following:

 

- 26 -

	 	(A)	 	by the execution of a
settlement agreement resolving the dispute by the parties;
	 
	 	(B)	 	by a written declaration of
the mediator to the effect that further efforts at mediation
are no longer worthwhile; or
	 
	 	(C)	 	after the completion of two
full days of mediation sessions, by written declaration of a
party or parties to the effect that mediation proceedings are
terminated.

	 	(c)	 	Litigation. Neither party may bring (or have brought) any Action in
any forum with respect to any Dispute arising out of or related to this Agreement, or
the breach or termination thereof, until such party has fully complied with Section
8.17(a) and (b) with respect to such Dispute.

8.18 Binding Effect and Assignment. This Agreement binds and benefits the parties and their
respective successors and permitted assigns. This Agreement is for the sole benefit of the parties
(and, solely for purposes of Section 3.11 and Section 4.8, the Persons indemnified
thereby) and nothing in this Agreement, express or implied, confers or intends to confer any rights
or remedies of any nature whatsoever in favour of any Person (including any employee or shareholder
of ATS or Photowatt) other than the parties.

8.19 Survival Beyond Completion. The rights and obligations of each party with respect to sections
entitled, “Patent Indemnity”, “Confidentiality”, “Proprietary Rights”, “Limitations of Liabilities
and Remedies”, shall survive termination of the Agreement or acceptance of the Deliverables in
accordance with their terms.

8.20 Expenses. Except as otherwise provided in this Agreement, each party shall be responsible for
its own fees, costs and expenses incurred in connection with the matters contemplated by this
Agreement.

8.21 Waiver. A provision of this Agreement may be waived only by a writing signed by the party or
parties intended to be bound by the waiver. A party is not prevented from enforcing any right,
remedy or condition in the party’s favour because of any failure or delay in exercising any right
or remedy or in requiring satisfaction of any condition, except to the extent that the party
specifically waives the same in writing. No waiver of any provision of this Agreement shall
constitute a waiver of any other provision nor shall any waiver constitute a continuing waiver
unless otherwise expressly provided. Any enumeration of a party’s rights and remedies in this
Agreement is not intended to be exclusive, and a party’s rights and remedies are intended to be
cumulative to the extent permitted by Law and include any rights and remedies authorized in Law or
in equity.

8.22 Compliance With Laws. Each party shall comply with all applicable legal requirements
(including all relevant federal, state and provincial legislation and regulatory requirements); and
without limiting the generality of the foregoing, each party shall comply with, and shall take all
necessary measures to ensure that (i) its actions (or lack of action) do not

 

- 27 -

result in non-compliance by the other party, with the provisions of the Personal Information
Protection and Electronic Documents Act (Canada) and any similar federal, state or provincial
legislation, including the provisions relating to the collection, use, retention and disclosure of
Personal Information and (ii) the transfer of any information hereunder is in compliance with
applicable export control or similar Laws.

8.23 No Agency. Nothing in this Agreement shall constitute or be deemed to constitute a
partnership or joint venture between the parties or constitute or be deemed to constitute any party
the agent or employee of the other party for any purpose whatsoever, and neither party shall have
authority or power to bind the other party or to contract in the name of, or create a liability
against, the other party in any way or for any purpose.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized
representatives.

	 	 	 	 	 	 	 	 	 	 	 
	ATS AUTOMATION TOOLING SYSTEMS INC.	 	 	 	PHOTOWATT TECHNOLOGIES INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 
	Date:
[Month] ___, 2007	 	 	 	Date:
[Month] ___, 2007	 	 

 

SCHEDULE A

LIST OF EQUIPMENT SUBJECT TO RIGHT OF FIRST REFUSAL

(SECTION 2.1)

The following Spheral Solar Equipment:

	 	1.	 	Foil Production Equipment
	 
	 	2.	 	Optical Fused Powder
	 
	 	3.	 	Front Bond
	 
	 	4.	 	Diagnostic BLP
	 
	 	5.	 	Back Bond
	 
	 	6.	 	Test/Sort
	 
	 	7.	 	Cell Cut & Test
	 
	 	8.	 	FWP weld
	 
	 	9.	 	FWP Cut
	 
	 	10.	 	Stringers
	 
	 	11.	 	Module Test
	 
	 	12.	 	General Material
Handling*
	 
	 	13.	 	New Automation Scopes

 

			
	*	 	General Material Handling includes automated wafer handling between workstations

 

SCHEDULE B

LIST OF EQUIPMENT SUBJECT TO PREFERRED SUPPLIER STATUS

(SECTION 2.2)

The following Wafer-based PV Equipment:

	 	1.	 	Screen Print
	 
	 	2.	 	Edge Isolation Laser
	 
	 	3.	 	Wafer Test
	 
	 	4.	 	Tabbing/Stringing
	 
	 	5.	 	Lamination
	 
	 	6.	 	Module Test
	 
	 	7.	 	*General Material
Handling
	 
	 	8.	 	New Automation Scopes

 

			
	*	 	General Material Handling includes automated wafer handling between workstations

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