1.  

Elgressy is engaged in the business of designing and manufacturing products for cooling tower water treatment systems, parts of which currently are either patented  or have patents pending (the " Products ") and desires that the sale and use of such Products be actively and diligently promoted in the Territory and in the Fields (both as defined below); and,

2.  

The Marketing Arm desires to actively and diligently promote the use of the Products in the Territory and in the Fields, with the aim of locating customers in the Territory and in the Field and entering into Lease Agreements or Sale Agreements, as defined below, for the Products with such customers.

1.  

" Additional Installation " means as defined in Section 3.12 below.

" Affiliate " means all persons and business entities that now or here­after, directly or indirectly, i) control, or ii) are owned or controlled by, or iii) are under common control of such Party.

" Agreement " means this document and any annex, exhibit, attachment, schedule, addendum, or modification hereto, unless the context otherwise indicates.

" Claims " means any and all costs, losses, liabilities, damages, lawsuits, judgments, claims, actions, penalties, fines and expenses (including, without limitation, interest, penalties, reasonable attorneys’ fees and all monies paid in the investigations, defense or settlement of any or all of the foregoing).

" Confidential Information " means any invention, know-how or idea of a Party hereto or any other scientific, business, technical or financial information of Party hereto including any proprietary information relating to the Products or the business of a Party hereto, its financials and business, marketing and sales plans that may be divulged to the other Party in the course of the performance of this Agreement provided however, that any of the above which is either (i) already known to the disclosing Party at time of its disclosure; or (ii) becomes publicly known through no wrongful act of the disclosing Party or as a result of a breach of this Agreement; or (iii) received from a third party free to disclose it to the

disclosing Party and without any obligations to keep confidential; or (iv) communicated to a third party with express written consent of the other Party, shall not be deemed to be Confidential Information.

" Customer ” means a lessee or purchaser(s) of Products pursuant to a Lease or a Sale Agreement under the Revenue Based Model (as defined in Section 9).

" Field " means any and all types of power plants in the United States (the “Power Plants ”) or the hotel chains set forth in Schedule1.8 hereto, in the United States (the " Hotels ");   the Power Plants and the Hotels are hereinafter collectively referred to as the " Fields ".

" Installation " means to install and execute the initial operation of a Pilot Products and/or the Products (as the case may be) at the Customer's facility.

" Intellectual Property Rights " means any and all patent and patent application rights, copyrights, moral rights and any other rights in works of authorship, rights to trademarks and service marks and applications, and all other intellectual property rights in connection with inventions, improvements, designs, configurations, ideas, concepts, innovations, know how, drawings, schematics, original works of authorship, formulae, concepts, techniques, methods, systems, processes, compositions of matter, software, databases and mask works; all of the foregoing, in any jurisdiction, whether or not patentable, copyrightable or protectable as trade secrets, irrespective of whether registered as a patent, copyright, trademark or in another form, and irrespective of whether constituting a commercial, professional or trade secret, including, without limitation, with respect to Elgressy, the Manufacturing Technology and the Production Data Package.

" Lease Agreement " means a lease agreement entered into by the Marketing Arm or a subsidiary thereof, with a Customer, for the lease of the Products, for a period of up to ten (10) years.

" Lease Price" means   the total consideration paid by the Customer in connection with the lease of the Products.

" Manufacturing Technology "   means hardware, software, inventions, data, trade secrets, works of authorship, know-how, methods and methodologies, inventions, ideas, processes and practices, technical data, drawings, formulations, technical reports, operating and testing procedures, instruction manuals, raw material or production specifications, computer software, the results of research and development work, whether in hard copy or in computer held form, including without limitation the Production Data Package and all Intellectual Property Rights underlying the Products;

" Material Breach " a material breach of this agreement shall be a default of a Party under Sections 3.3( 'Non-competition ), 3.15 (' Title to Modifications '),  4.15 (' Elgressy IP rights ') and any other breach which a Party fails to rectify, if rectifiable, within a period of thirty (30) days after receipt of a written notice of default. In order to remove doubt, failure to reach the sales targets whether pursuant the Short Marketing Plan or the Five Year Marketing Plan will not be considered a Material Breach.

“ Pilot Product ” means as defined in Section 4.5 below.

" Product " means as defined in the recitals above.

“ Production Data Package ” means the design, engineering, functional and technical specifications, bill of materials and testing procedures for the Products, including net lists, schematics, enhancements, designs, formulae, processes, drawings, routines, subroutines, techniques, concepts, computer software programs or applications (in both source code and object code form), flow charts, diagrams, work product and other materials or any types whatsoever, know-how, and tangible or intangible information or material, including third party software to the extent permitted by law or contract.

" Regulatory Requirements " means any laws, rules, regulations, certifications and standards under any applicable law or that are promulgated or provided by a governmental or regulatory agency, as they may be from time to time, which apply to or are required for certain activity in connection with or arising out of this Agreement.

A “ Sale Agreement ” means an agreement for the sale of the Products entered into by the Marketing Arm or its subsidiary with a Customer.

" SLA " means a service level agreement. " Elgressy SLA " means the SLA which sets forth the level of service Elgressy is required to provide to the Marketing Arm, and is attached hereto as Schedule 1.21A . " MA SLA " means the SLA which sets forth the minimum level of service the Marketing Arm, directly or indirectly, is required to provide to a Customer and is attached hereto as Schedule 1.21.B .

2.  

Appointment. Elgressy hereby appoints the Marketing Arm as: (1) its exclusive independent sales and marketing representative for the Products in the Territory and the Fields, and (2) its exclusive service provider relating thereto, and the Marketing Arm hereby accepts such appointments, all subject to the terms and conditions of this Agreement.

Activity Outside Territory. The Marketing Arm shall be entitled to act outside the Territory and/or the Fields with respect to marketing and sale of the Products, only with the prior written consent of Elgressy, for each sale.

The Marketing Arm may use subcontractors and/or subagents including the Marketing Arm’s subsidiaries (“ Subagent(s) ”), to promote the sale, lease and use of the Products and for the Installation (as defined below) and the supply of the after sale technical and other required services in the Territory and/or in the Fields; provided that : (i) the Marketing Arm shall provide Elgressy with the name, address and field of activity of any such Subagent, (ii) all agreements with Subagents relating to the Products (“ Subagent’s Agreement(s) ”) shall be consistent with this Agreement and shall include the provisions attached hereto as Schedule 2.3.1 , and (iii) Elgressy shall have the right to demand that the Marketing Arm replace any Subagent in the event of a breach of this Agreement and/or the Subagent's Agreement, if such breach is not cured within sixty (60) days of receiving a notice by the Marketing Arm from Elgressy regarding such breach. It is agreed that the Marketing Arm shall consult Elgressy regarding the criteria which may be applied for selecting local Subagents. The Marketing Arm shall inform Elgressy, as soon as practical, of it becoming aware, of any breach by Subagent which constitutes a breach of this Agreement or a breach of a Subagent's Agreement, affecting Elgressy’s IP rights . The Marketing Arm shall assist Elgressy in protecting Elgressy’s rights against such acts and infringements.

The Marketing Arm shall require its Subagents, acting on behalf of the Marketing Arm with respect to this Agreement, to purchase and maintain insurance at all times throughout the term of the Subagent's Agreement, at such Subagent's own account, with respect to the operation of the Products (“ Subagent's Insurance Policies ”). The Subagent's Insurance Policies will have terms and conditions and a limit of liability in an amount as shall be advised by an independent insurance expert, to be appointed by the Marketing Arm at no expense to Elgressy. The Subagent's Insurance Policies shall name each of the Marketing Arm and Elgressy as additional insured or loss payee.

3.  

ADDITIONAL UNDERTAKINGS OF THE MARKETING ARM

The Marketing Arm undertakes that it will make reasonable commercial efforts to promote the sale/lease and use of the Products in the Territory and in the Fields.

The Marketing Arm agrees to make reasonable commercial efforts to carry out the marketing, promotion and sale/lease of the Products in the Territory and in the Fields, by different means, at its sole discretion, but in no case less than reasonable commercial means pursuant to the Short Marketing Plan and the 5 Year Marketing Plan (both as defined below). Any and all marketing, promotional, sales and administrative costs, including any and all costs associated with attendance at or participation in trade shows, congresses or similar conferences, shall be borne by the Marketing Arm, unless otherwise is expressly stated in this Agreement.

Non-competition. The Marketing Arm declares that it is not currently selling or promoting products that are competitive with the Products in the Territory and/or the Fields, and that the Marketing Arm does not have, nor during the term of this Agreement will it have, any conflict of interest or otherwise be subject to any restriction or third party agreement that would substantially adversely impair or prevent the Marketing Arm from representing the Products in the Territory and in the Fields faithfully and diligently, and during the term of this Agreement and for a period of two (2) years following its termination,  will not sell or promote products that are competitive with the Products.

Marketing and Sales Plan . Prior to the signing of this Agreement the Marketing Arm has provided Elgressy with a detailed marketing and sales plan for the first year, including quarterly sales targets (“ Short Marketing Plan ”). The signing of this Agreement by the parties hereto is deemed consent of the Parties to the content of the Short Marketing Plan. The Short Marketing Plan includes the following:

An aggregate sales target of US$750,000 (seven hundred and fifty thousands US dollars) for Germany; and,

An aggregate minimum sales target of US$750,000 (seven hundred and fifty thousands US dollars) for 3 States chosen out of those listed on Schedule 1.15 (the " Chosen States "), for the first calendar year. It is agreed that the Marketing Arm shall inform Elgressy by written notice within 3 months of signing this Agreement of the identity of the Chosen States.

An additional aggregate sales target of US$750,000 (seven hundred and fifty thousands US dollars) for the Power Plants;

An additional aggregate target of two Pilots in the Hotels chosen out of Schedule 1.5, within 6 months of signing this Agreement (the " Chosen Hotels ") and a sales target of US$100,000 (one hundred thousand US dollars) for the Chosen Hotels together (at least US$50,000 in each of the two Hotels) for the first calendar year. It is agreed that the Marketing Arm shall inform Elgressy, by written notice, within 3 months of signing this Agreement, of the identity of the Chosen Hotels.

It is clarified that the aggregate total sales target for the first year commencing upon signing this Agreement is US$2,350,000 (two million three hundred and fifty thousand US dollars ).

Each of the sales targets set forth in the Short Marketing Plan or annual targets for the Five Year Marketing Plan, respectively, shall be deemed to be achieved, if the annual aggregate Contract Value of the agreements relating to each of such Territory or Field entered into by the Marketing Arm and/or any of its Subagents within the relevant year, shall be equal to or greater than 75 % of US$750,000 (seven hundred and fifty thousands US dollars), and, with respect to the Chosen Hotels, equal to or greater than US$100,000 (one hundred thousand dollars) with respect to the Short Marketing Plan and 75% of the sales target for each year specified in the Five Year Marketing Plan.

For the purposes of this Agreement the term " Contract Value " means the minimum projected total aggregate amount of all income to be generated over 12 (twelve) months from signing a specific contract, in accordance with the terms of that contract, commencing upon the signing of such specific contract regardless whether such period will extend beyond the year with respect to which sales targets are being calculated, according to the terms of such specific contract; provided howeve r that if the actual total aggregate amount of all income generated, with respect to each Lease and Sale Agreements - during the twelve (12) months period from its signing, from Lease and Sale Agreements entered into during the relevant (relevant for the purposes of sale target calculations) year is less than the amounts specified in this Section 3.4.6 above then the said sales targets shall be deemed not to have been achieved, and the provision of Section 3.8 below shall apply, including the Marketing Arm Option, as defined therein.

Hotels and States . If the Marketing Arm achieves the aforesaid targets with respect to the Chosen Hotels (both Pilot targets and sales targets), then in the following year the Marketing Arm shall be entitled to the rights granted under this Agreement with respect to two additional Hotels and to one additional State, out of the list attached hereto as Schedule 1.8,  and this mechanism shall continue in the years thereafter, granting the Marketing Arm the rights to sell to two additional Hotels a year, and one additional State  for each subsequent year, subject to its meeting the previous year's sales target for such Chosen Hotels or Chosen States (including for the States added as aforesaid), as applicable.

Five Year Marketing Plan. Attached to this Agreement as Schedule 3.6 , are the five year sale targets including projections for each of the different States, Territories  and Fields, for the first five (5) years following the first calendar year of this Agreement (the “ Five Year Marketing Plan ”).

Updated Targets.   It is agreed that each of the annual sale targets in the Five Year Marketing Plan,  for subsequent five (5) year periods and thereafter shall be at least 4% greater than the targets for the previous calendar year.

Non-Performance. If the Marketing Arm does not meet at least 75% of its annual targets as set out in the Short Marketing Plan and in the Five Year Marketing Plan and/or with regard to the Pilot targets (“ Non-Performance ”), as updated from time to time in accordance with Section 3.7 above, then subject to Marketing Arm Option, as defined below, (i) Elgressy may at any time and in its sole discretion, terminate the Marketing Arm's rights to exclusivity with respect to the Territory and/or the Field regarding which the Non-Performance occurred, by giving ninety (90) days written notice to the Marketing Arm. For as long as Elgressy has not granted any third party exclusive rights for such Territory or Field, the Marketing Arm will be allowed to continue and operate on a non-exclusive basis in such Territory or Field, or part thereof, which is not subject to third party exclusivity rights) as the case may be. Upon the appointment by Elgressy of an exclusive representative or agent in a Chosen State or Germany or Field, the Marketing Arm will have no further rights in such Chosen State or Germany or Fields, as the case may be, except under existing Sales or Lease Contracts. The Marketing Arm shall not have any claims and shall not be entitled to any remedy against, and compensation from, Elgressy or anyone acting on its behalf, in connection with any such termination of rights. It is hereby clarified, that if the Marketing Arm does not achieve 75% of the aforesaid annual targets with respect to the States, it shall lose its exclusivity with respect to all the States. However notwithstanding the above, if an annual target is not met, the Marketing Arm shall have the option to pay Elgressy a cash payment equal to Elgressy's share in the shortfall with regard to 75% of the relevant annual target, in order to keep its exclusivity in the aforementioned Territories or Fields (the " Marketing Arm Option "). The Marketing Arm Option must be exercised and funded within sixty (60) days of the end of a relevant year, after which it shall expire.

Subject to any applicable law and regulation, the Marketing Arm shall provide Elgressy with a written report, not later than thirty (30) days following the completion of each quarter, indicating the Marketing Arm’s sales/leases in the Territory in the previous calendar quarter, with the Customer’s name and address. The Marketing Arm will also provide Elgressy copies of all agreements, in connection with the Products, which were entered into  with Customers and Subagents. The Marketing Arm shall maintain complete and accurate records of the location, quantities, catalog number, place of sale in the Territory and lot numbers of all shipments as part of its in-house tracking program for a period not less than the longer of: (i) three (3) years after the last Product was dispatched by Elgressy to the Marketing Arm, and (ii) the period required under any applicable law or regulation.

In addition, the Marketing Arm shall provide El