Exhibit 10.23

FIRST AMENDMENT TO THE

EXECUTIVE SEVERANCE AGREEMENT

This First Amendment to the Executive Severance Agreement (this “Amendment”) is
entered into as of June 29, 2006 by and between Plug Power Inc., a Delaware
corporation (the “Company”), and William D. Ernst, as (the “Executive”).

RECITALS

WHEREAS, the Company and the Executive entered into that certain Executive
Severance Agreement as of January 11, 2006 (the “Agreement”).

WHEREAS, the Company and the Executive desire to amend the Agreement.

WHEREAS, all capitalized terms used but not defined in this Amendment shall have
the meanings ascribed to such terms in the Agreement.

AGREEMENT

NOW, THEREFORE, for good and valuable consideration, including, without
limitation, the Executive’s continued employment by the Company on an at will
basis (or such other basis as existed prior to the date hereof) and continued
eligibility to receive awards under the Plug Power Inc. 1999 Stock Option and
Incentive Plan, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto, intending to be legally bound, hereby agree as follows:

SECTION 1. AMENDMENT

The Agreement is amended as follows:

1.1. Section 2 is amended and restated as follows:

“2. Change in Control. A “Change in Control” shall be deemed to have occurred in
any one of the following events:

(a) any “person,” as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), (other than
the Company, any of its subsidiaries, any trustee, fiduciary or other person or
entity holding securities under any employee benefit plan or trust of the
Company or any of its subsidiaries, or, subject to the consummation of the
transactions described in that certain Stock Purchase Agreement, dated as of
April 10, 2006, by and between the Company and Smart Hydrogen Inc., a BVI
Business Company (“Smart Hydrogen”), as the same may be amended from time to
time (the “Stock Purchase Agreement”), Smart Hydrogen and any Permitted
Transferee (as

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defined in the Certificate of Designations of Class B Capital Stock attached as
Exhibit A to the Stock Purchase Agreement, as the same is filed with the
Delaware Secretary of State and may be amended from time to time (the “Class B
Certificate of Designations”)), together with all Affiliates and Associates (as
such terms are hereinafter defined) of such person, shall become the “beneficial
owner” (as such term is defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of securities of the Company representing 25% or more of the then
outstanding shares of common stock of the Company (the “Stock”) (other than as a
result of an acquisition of securities directly from the Company); or

(b) persons who, as of the effective date of the Agreement (the “Effective
Date”), constitute the Company’s Board of Directors (the “Incumbent Directors”)
cease for any reason, including, without limitation, as a result of a tender
offer, proxy contest, merger or similar transaction, to constitute at least a
majority of the Board, provided that any person becoming a director of the
Company subsequent to the Effective Date shall be considered an Incumbent
Director if such person’s election was approved by or such person was nominated
for election by either (i) a vote of at least a majority of the Incumbent
Directors or (ii) a vote of at least a majority of the Incumbent Directors who
are members of a nominating committee comprised, in the majority, of Incumbent
Directors; but provided further, that any such person whose initial assumption
of office is in connection with an actual or threatened election contest
relating to the election of members of the Board of Directors or other actual or
threatened solicitation of proxies or consents by or on behalf of a Person other
than the Board, including by reason of agreement intended to avoid or settle any
such actual or threatened contest or solicitation, shall not be considered an
Incumbent Director; or

(c) Upon (A) the consummation of any consolidation or merger of the Company
where the shareholders of the Company, immediately prior to the consolidation or
merger, did not, immediately after the consolidation or merger, beneficially own
(as such term is defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, shares representing in the aggregate more than 50% of the voting
shares of the corporation issuing cash or securities in the consolidation or
merger (or of its ultimate parent corporation, if any), (B) the consummation of
any sale, lease, exchange or other transfer (in one transaction or a series of
transactions contemplated or arranged by any party as a single plan) of all or
substantially all of the assets of the Company or (C) the completion of a
liquidation or dissolution that has been approved by the stockholders of the
Company; or

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(d) Smart Hydrogen or any Permitted Transferee (as defined in the Class B
Certificate of Designations), together with all Affiliates and Associates (as
such terms are hereinafter defined) of such person, shall become the “beneficial
owner” (as such term is defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of securities of the Company representing 50% or more of the then
outstanding Stock (other than as a result of an acquisition of securities
directly from the Company).

Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have
occurred for purposes of the foregoing clauses (a) or (d) solely as the result
of an acquisition of securities by the Company which, by reducing the number of
shares of Stock outstanding, increases the proportionate number of shares of
Stock beneficially owned by any person to 25% or more (or 50% or more in the
case of clause (d)) of the shares of Stock then outstanding; provided, however,
that if any such person shall at any time following such acquisition of
securities by the Company become the beneficial owner of any additional shares
of Stock (other than pursuant to a stock split, stock dividend, or similar
transaction) and such person immediately thereafter is the beneficial owner of
25% or more (or 50% or more in the case of clause (d)) of the shares of Stock
then outstanding, then a “Change in Control” shall be deemed to have occurred
for purposes of the foregoing clause (a) or (d), as applicable.

(e) For purposes of this Agreement, “Affiliate” and “Associate” shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the Exchange Act, as
in effect on the date of this Agreement; provided, however, that no person who
is a director or officer of the Company shall be deemed an Affiliate or an
Associate of any other director or officer of the Company solely as a result of
his position as director or officer of the Company.”

1.2. All other terms and conditions of the Agreement shall be unchanged and
remain in full force and effect.

SECTION 2. MISCELLANEOUS

2.1. Settlement and Arbitration of Disputes. Any controversy or claim arising
out of or relating to this Amendment or the breach thereof shall be settled
exclusively by arbitration in accordance with the laws of the state of New York
by three arbitrators, one of whom shall be

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appointed by the Company, one by the Executive and the third by the first two
arbitrators. If the first two arbitrators cannot agree on the appointment of a
third arbitrator, then the third arbitrator shall be appointed by the American
Arbitration Association in the City of Albany. Such arbitration shall be
conducted in the City of Boston in accordance with the rules of the American
Arbitration Association for commercial arbitrations, except with respect to the
selection of arbitrators which shall be as provided in Section 8(d) of the
Agreement. Judgment upon the award rendered by the arbitrators may be entered in
any court having jurisdiction thereof.

2.2. Entire Agreement. This Amendment and the Agreement constitute the entire
agreement between the parties with respect to the subject matter hereof and
supersede in all respects all prior agreements between the parties concerning
such subject matter.

2.3. Amendment. This Amendment may be amended or modified only by a written
instrument signed by the Executive and by a duly authorized representative of
the Company.

2.4. Governing Law. This is a New York contract and shall be construed under and
be governed in all respects by the laws of the state of New York.

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IN WITNESS WHEREOF, the undersigned executed this Amendment as of the day and
year first above written.

 

COMPANY Plug Power Inc. By:  

/s/ Roger B. Saillant

  Roger B. Saillant   Chief Executive Officer

/s/ William D. Ernst

Name:   William D. Ernst