Press Release:February 2008

QIO Systems and Cotswold Industries Announce Worldwide Sales and Marketing Agreement

New York, NY 26 February 2008, QIO Systems, the wearable electronics spin-off of Eleksen, has agreed to a joint sales and marketing agreement with Cotswold Industries, Inc. of New York City. Cotswold will resell QIO’s full line of accessory electronics designed for iPod and Bluetooth devices, along with Eleksen’s ElekTex touchpads, to apparel customers worldwide.

In the emerging market for-wearable electronics populated by small, undercapitalised players, Cotswold brings experience, leadership and a global capability. Cotswold’s worldwide logistics team already serves multi-million dollar accounts such as Levi Strauss, The Gap, VF Corporation, Abercrombie & Fitch and has a reputation for delivery as promised and world class tomer service.

Under the agreement, Cotswold will resell ElekTex touchpads and QIO electronics to apparel brands and manufacturers for bundled (wholesale) and eSystem (direct) distribution to company retail locations. Cotswold will also provide worldwide integration support for its customers, while QIO Systems retains responsibility for marketing and brand awareness for the QIO solutions and the ElekTex touchpads.

“QIO sought a partnership for our business that could support some of our largest customers, commented John Collins, CEO and President of QIO Systems. Signing with a global textile company such as Cotswold brings a worldwide sales presence and logistics capability to market. With Cotswold, customers now have the option of buying cutting edge technology from a partner that they’ve known and trusted for over 50 years.”

“All of our customers are interested in this space, and the spin-out of QIO from Eleksen ensures that product quality and Eleksen’s design excellence – will continue to add tremendous value to Cotswold’s core apparel offerings, remarked James McKinnon, CEO of Cotswold Industries. Our goal is to embed an ElekTex touchpad in every outerwear garment within the next 10 years and we’re excited to partner with QIO Systems to bring this vision to the world’s consumers.”

Cotswold is accepting orders for delivery of ElekTex products and QIO electronics directly or through its sales and marketing partners. Cotswold can be contacted at their New York office at +1-212-689-3432 for all product inquiries.

About QIO Systems

QIO Systems is the wearable electronics spin-out of market leader Eleksen. QIO designs, develops and manufactures next generation accessory electronics for interactive apparel and soft goods applications supporting the seamless integration of mobile entertainment devices like MP3 players, cell phones, AM/FM/Digital radio, push-to-talk systems in consumers everyday lives.

QIO manufactures, sells and markets Eleksen’s ElekTex textile touchpads under exclusive world-wide license from Peratech Limited for use in wearable electronics applications for consumer apparel, bags and accessories as well as commercial work wear applications supporting integrated electronics controls for entertainment, communications, environmental, safety and bio-monitoring devices.

Based in New York and London, QIO Systems serves as the technology partner to boutique and global apparel and lifestyle brands worldwide. For further information please contact QIO Systems at Qonnect@QIOSystems.com.

QIO, QIO Systems are trademarks of QIO Systems, Inc. Eleksen, ElekTex are trademarks of Peratech Limited

About Cotswold Industries

Cotswold Industries is a US based manufacturer and converter of apparel and industrial textile products for sale in North America, Latin America and throughout the Asia / Pacific region.

Cotswold brings over 50 years of product innovation and industry expertise to the global apparel market. The company is a vertically integrated manufacturer and industry expert in bringing component parts to market for major branded apparel companies throughout the world.

Cotswold is a third generation family company headquartered in New York, NY (www.cotswoldapparel.com)