Exclusive Supply Agreement

Acta S.p.A.

("Acta" or "the Company")

Exclusive Supply Agreement

Acta S.p.A. (AIM: ACTA), the clean energy products company, is delighted to announce that it has signed a Supply Agreement ("Agreement") for the exclusive supply of its core hydrogen generation components to a leading fuel cell and electrolyser manufacturer for incorporation into their electrolyser for consumer fuel cell applications.

The Agreement is conditional upon the successful completion of an initial performance validation phase, which the parties expect to complete within the next three to six months. Subject to this performance validation, Acta will be specified as the exclusive supplier of alkaline membrane electrode assembly ("MEA") components for the new electrolyser and for any other alkaline membrane-based electrolyser equipment produced by the customer for other applications. The Agreement includes pricing terms for mass volumes of up to 100,000 units per annum.

Application Overview

The contract is for the supply of Acta's alkaline MEA's for a consumer electrolyser to be used to refill small hydrogen cartridges for fuel cell applications.

Initial product applications for the hydrogen cartridges include a fuel cell recharger for electronic devices (3G mobile phones etc) that has already been developed, while mass market adoption may come through the incorporation of fuel cells into product applications such as portable electrical equipment and devices, including power tools and power generators, by other original equipment manufacturers.

The introduction of the consumer electrolyser is an ideal strategy for addressing the mass market for fuel cell applications, by promoting the development of a consumer hydrogen infrastructure ahead of the introduction third-party fuel cell products, and by demonstrating the technical and commercial viability of these products to consumers for the first time.

Technical Compatibility

The desktop electrolyser is a technically demanding application which requires a robust, high-performing system at a low cost. Acta's technology is being evaluated for this application due to the inherent technical advantages offered by Acta's alkaline technology over existing PEM-based electrolyser technology, which include the following:

i) Consumer-friendly. Acta's alkaline membrane technology works with simple deionised water, such as that available from supermarkets for ironing. This is not possible for PEM-based systems, which require high purity water to prevent fouling of the system.

ii) High pressure hydrogen. The cartridge system requires hydrogen to be supplied at up to 30 bar pressure, higher than that available from normal PEM-based electrolysers, which typically deliver hydrogen at up to 15 bar excluding additional compression systems. Acta's electrolysers produce hydrogen at up to 30 bar without external compression.

iii) Low cost. Acta's alkaline membrane technology avoids the precious metal components and system complexity which puts PEM-based electrolysers outside the reach of consumer product pricing.

Paolo Bert, CEO of Acta said, "This is a very exciting application of our core technology, with the potential to lead to mass market sales of consumer fuel cell products for the first time. We look forward to providing greater disclosure on the application and its commercial potential in due course."

- ENDS-

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About Acta S.p.A.

Acta S.p.A. is a developer and manufacturer of a range of clean energy products. Its product line includes market-leading compact hydrogen generators (electrolysers) which produce pure, dry and compressed hydrogen in a way that is easy-to-use and completely safe, and the Company is committed to integrating its award-winning electrolysers with renewable energy sources.

Acta's cost-competitive electrolysers are based on its proprietary, inexpensive environmental catalyst and hydrogen conversion technologies. These products help overcome the barriers to the adoption of fuel cells, most notably the lack of a local hydrogen infrastructure. They are also applicable in non-fuel cell hydrogen and oxygen applications, including oxy-hydrogen gas welding systems, where the Company is generating significant commercial interest.

Acta's low-cost hydrogen generators represent a unique breakthrough in electrolyser technology. They can operate using mains power or intermittent renewable energy, and produce clean, dry hydrogen already at pressure for use in fuel cell and other applications. This unique combination of features avoids the system complexity and energy cost of further cleaning, drying and compression of the hydrogen, resulting in a simple, compact, low-cost and highly efficient system that is ideally suited for energy conversion and storage applications. In such applications, which include battery replacement and renewable energy storage, low cost and high efficiency are critical to commercial viability, while hydrogen compression is essential for the energy density of the system. No other water electrolyser currently on the market offers this combination of benefits.

Acta is focusing on delivering its products to markets with high volume demand for high-value environmental solutions (transport, back-up power, energy and leisure). It is accelerating the commercialisation of its products via partnerships with original equipment manufacturers (OEMs), distributors, and agents in these sectors, and intends to drive down production costs at high volume via contract manufacturing.

Acta S.p.A. is based near Pisa, Italy, and was admitted to trading on AIM in October 2005.

www.actagroup.it