Extended Collaboration Agreement

                                                                    EXHIBIT 10.5

                                                              September 22, 2006

Wilbert van den Hoek
Novellus Corporation
4000 North 1st Street
San Jose, CA. 95134


RE:  Agreed Milestones Under the Extended Collaboration Agreement between Neah
     Power Systems, Inc. (a state of Washington corporation) and Novellus
     Systems, Inc.

Dear Wilbert:

Set forth below are the agreed Milestones that were to be reasonably negotiated
in the ninety (90) days following the date of the Letter Agreement and Warrant.
All of the terms and conditions relating to these Milestones are stated in the
Letter Agreement dated May 22, 2006, except as otherwise stated herein.

     1.   Ten (10) percent of the Warrants granted to Novellus to purchase
          4,705,000 shares of the Common Stock of Neah Power Systems, Inc., the
          Nevada corporation, issued as part of the Letter Agreement and Warrant
          exchange between Neah and Novellus dated May 22, 2006 (hereinafter
          such Warrants are referred to as the "Warrants"), shall vest in full
          on the satisfaction of the following project Milestone, targeted for
          the end of Q4, 2006:

               Completion of a 10 W PPFC, i.e., a fully self contained fuel cell
               capable of producing 10 Watts of power continuously for 5 hours
               using one cartridge. The 10 W PPFC Pro