FIXED PRICE SERVICES AGREEMENT

                                     BETWEEN

                               EPRIsolutions, Inc.

                                       AND

                                PowerCo US, Inc.


<PAGE>

EPRIsolutions/SA                                    Agreement No. EC-P1204/C3714
                                                                Proj. #:  053649


                         FIXED PRICE SERVICES AGREEMENT
                         ------------------------------


         This Services  Agreement  ("Agreement")  is entered into by and between
EPRIsolutions,  Inc.,  a Delaware  corporation,  with  offices at 3412  Hillview
Avenue,  P.O. Box 10412,  Palo Alto,  California  94303  ("EPRIsolutions"),  and
PowerCo US, Inc. with its principal  offices at 5000 Robert J. Mathews  Parkway;
El  Dorado  Hills,  CA 95762  ("CONTRACTOR").  In  consideration  of the  mutual
covenants and agreements hereinafter set forth, the parties agree as follows:


ARTICLE  1 - Provision of Services
----------------------------------

         1.1  General.   EPRIsolutions   desires  to  retain  CONTRACTOR  as  an
independent contractor to perform services for EPRIsolutions,  and CONTRACTOR is
willing to perform such services  ("Services") on the terms set forth under this
Agreement  and as  described  in the  Schedule  to Services  Agreement  which is
incorporated herein by reference (the "Schedule").

         1.2 Independent Contractor.  Nothing in this Agreement shall in any way
be construed to constitute  CONTRACTOR as an agent or employee of EPRIsolutions,
but  CONTRACTOR   shall  perform  the  Services   hereunder  as  an  independent
contractor. Nothing contained herein shall be construed to imply a joint venture
or principal and agent relationship  between the parties and neither party shall
have any right, power or authority to create any obligation, express or implied,
on behalf of the other in connection with the performance hereunder.  CONTRACTOR
agrees to  furnish  (or  reimburse  EPRIsolutions  for) all tools and  materials
necessary to accomplish  this Agreement and shall incur all expenses  associated
with  performance,  except  as  expressly  provided  in  the  Schedule  to  this
Agreement.  Neither  CONTRACTOR  nor  CONTRACTOR's  employees or agents,  if any
("CONTRACTOR's  Employees"),  will be eligible  for any  EPRIsolutions  employee
benefits.


ARTICLE  2 - Price and Funds Limitation
---------------------------------------

         Firm  Fixed  Price.  The total  fixed  price to  EPRIsolutions  for the
equipment  lease for a term of two years  and the  Services  is set forth in the
Schedule (the "Firm Fixed Price").  EPRIsolutions  shall not be obligated to pay
CONTRACTOR any amount greater than the Firm Fixed Price.


ARTICLE  3 - Invoicing and Payments
-----------------------------------

         3.1 Invoicing.   Invoices  shall be  submitted in  accordance  with the
Milestone  Payment  Schedule set forth in the Schedule.  Invoices shall refer to
the EPRIsolutions  Agreement number,  EC-P1204/C3714,  and shall be submitted by
the CONTRACTOR to the attention of EPRIsolutions, Accounts Payable.

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<PAGE>

         3.2 Payments.   Approved  invoices  shall be paid in full and  payments
shall be directed to the CONTRACTOR's address shown on the invoice.


ARTICLE  4 - Reports
--------------------

         CONTRACTOR  shall  provide the reports  specified  in the  Schedule and
agrees that it will from time to time (as specified in the Schedule)  during the
term of this Agreement or any extension thereof keep EPRIsolutions advised as to
CONTRACTOR's  progress in performing the Services  hereunder and that CONTRACTOR
will,  as  requested  by  EPRIsolutions,  prepare  written  reports with respect
thereto, including but not limited to administrative/financial reports as may be
set  forth in the  Schedule.  It is  understood  that the time  required  in the
preparation  of such written  reports  shall be  considered  time devoted to the
performance of CONTRACTOR's Services.


ARTICLE  5 - CONTRACTOR's Representations and Covenants
-------------------------------------------------------

         5.1 Conflicting  Obligations.  CONTRACTOR certifies that CONTRACTOR has
no  outstanding  agreement  or  obligation  that is in conflict  with any of the
provisions of this Agreement,  or that would preclude  CONTRACTOR from complying
with the provisions hereof, and further certifies that CONTRACTOR will not enter
into  any  such  conflicting  agreement  during  the  term  of  this  Agreement.
EPRIsolutions  and CONTRACTOR agree that CONTRACTOR and  CONTRACTOR's  Employees
are free to  provide  services  to  others  during  the term of this  Agreement,
provided that neither  CONTRACTOR nor CONTRACTOR's  Employees during the term of
this  Agreement  engage  in any  such  services  or  enter  into  any  agreement
inconsistent with or in conflict with any provision hereof.

         5.2 Compliance with Laws.  CONTRACTOR agrees to comply with present and
future  applicable  labor and  employment  laws,  including,  but not limited to
health, safety and environmental laws, regulations and orders.

         5.3 Report Income.  CONTRACTOR  shall report as income all compensation
received by CONTRACTOR  pursuant to this  Agreement and pay all  employment  and
other applicable taxes thereon in a timely manner.

         5.4 Standard of Care.  CONTRACTOR  and its  employees  agree to perform
Services  with a standard of care,  skill and diligence  normally  provided by a
professional  person  in  the  performance  of  services  of the  type  rendered
hereunder.

         5.5 Safety.  CONTRACTOR agrees to perform Services in a safe manner and
in compliance with all customary safety practices.


ARTICLE  6 - Intellectual Property Rights
-----------------------------------------

         6.1 Ownership and Lease  Possession  Rights.  CONTRACTOR  shall own all
right,  title, and interest in and to all tangible and intangible  equipment and
information provided to EPRIsolutions by CONTRACTOR. EPRIsolutions shall own all
rights to possession and use of the equipment during the two year lease term and
shall own all right title and  interest in and to  information  and test results
generated by EPRIsolutions  and any reports based on their tests of CONTRACTOR'S
supplied Stirling engine  equipment.  CONTRACTOR shall be provided copies of any
reports  resulting from the testing of  CONTRACTOR'S  supplied  Stirling  engine
prepared by  EPRIsolutions  and shall have the right to use and disseminate such
reports in the course and scope of its business.

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<PAGE>

         6.2 Copyright  Notices.  EPRIsolutions  will apply copyright notices to
all copyrightable reports,  indicating EPRIsolutions ownership of the copyrights
in the item.

The  year  in  the  notice  shall  be the  first  year  of  publication  or,  if
unpublished, the year in which the item was completed.

         6.3 Notice of  Inventions  and  Discoveries.  Whenever any invention or
discovery  is made,  conceived  or first  reduced to practice by  CONTRACTOR  or
CONTRACTOR'  Employees or  subcontractors  (if any) in the  performance  of this
Agreement,   CONTRACTOR  shall  promptly  furnish   ERPIsolutionswith   complete
information thereon in a format acceptable to EPRIsolutions  including,  without
limitation, a written description thereof giving the date of invention and names
of the inventors and others involved in its development.

         6.4 Agreements  with  Employees.   Except as  otherwise  authorized  in
writing  by  the  parties  CONTRACTOR  and  EPRIsolutions  will  obtain  written
agreements  with their Employees as necessary to effectuate the purposes of this
Agreement.

         6.5 No Claim. CONTRACTOR agrees that it will not assert or establish or
assist any third  party  with  respect  to any claim for  Intellectual  Property
Rights inconsistent with those granted to EPRIsolutions herein.

         6.6 EPRIsolutions' Rights. Except as expressly authorized in writing by
CONTRACTOR,  EPRIsolutions  shall  have  no  rights  to use,  sell,  distribute,
publish,  reproduce,  modify, create derivative works of, make, or have made the
Technology.

         6.7 Computer Programs. CONTRACTOR agrees that any computer programs and
related  software  delivered  to  EPRIsolutions  under this  Agreement  shall be
checked by CONTRACTOR to determine if it is free of viruses that are  detectable
using accepted industry  practice at the time of delivery to  EPRIsolutions.  In
addition, any such software delivered to other organizations,  including but not
limited to other EPRIsolutions contractors and electric utility companies, shall
also be  checked  by  CONTRACTOR  to  determine  if it is free of such  viruses.
CONTRACTOR  shall label all software  diskettes and other  electronic media with
the date and method used to check for virus contamination, and prior to delivery
to EPRIsolutions or other organizations promptly replace any such software found
to contain virus  contamination  as of that time with the software free of known
viruses.


ARTICLE  7 - Confidentiality
----------------------------

         7.1  Restrictions    on  Disclosure   and  Use.  The   CONTRACTOR   and
EPRIsolutions  acknowledge  that during the term of this  Agreement they will be
exposed to certain  information  concerning  each others business and technology
and related information which is confidential or proprietary to the other and is
not generally known to the public ("Confidential Information"). Without limiting
the foregoing,  the Technology  shall be deemed to be Confidential  Information.
The  CONTRACTOR and  ERPIsolutions  agree that during and after the term of this
Agreement  they  will  not  use,   disclose  or  communicate  any   Confidential
Information  of the  other to third  parties  or  employees  except:  (i)  those
employee(s) who are required to have access to the  Confidential  Information in
order to enable the CONTRACTOR or EPRIsolutions to carry out the purposes of any

                                       3
<PAGE>

Agreement,  and who first shall have been informed of the duties and obligations
as  stated  herein;  or (ii)  any  third  party as to which  the  CONTRACTOR  or
EPRIsolutions  obtains prior written authorization from the other, and who first
shall have signed a  confidentiality  agreement  containing  the same duties and
obligations  as stated herein,  and (iii) in accordance  with the provisions and
for the  purposes of this  Agreement,  and will not  disclose  any  Confidential
Information  to any  third  Party  without  the  prior  written  consent  of the
disclosing  party.  With  the  exception  of the  Technology,  if  either  party
furnishes any of its Confidential Information to the other, the disclosing party
shall clearly mark or otherwise designate it as "Proprietary Information."

         7.2  Exceptions.  The  provisions  of this Article 7 shall not apply to
Confidential Information to the extent that such information is:

              (a)  generally  known  or otherwise in the public  domain prior to
disclosure hereunder,  or becomes so known subsequent to such disclosure through
no fault of the non-disclosing party;

              (b)  received by CONTRACTOR or  EPRIsolutions  after the Effective
Date of this  Agreement  without  restriction  from a third  party  not under an
obligation to  EPRIsolutions  or CONTRACTOR not to disclose it and otherwise not
in violation of EPRIsolutions' or CONTRACTOR'S rights; or

              (c)  furnished to any third party by  EPRIsolutions  or CONTRACTOR
without a similar restriction on the third party's rights.

         7.3  Third Party Information From  EPRIsolutions or CONTRACTOR.  During
the term of this Agreement, neither ERPIsolutions nor CONTRACTOR will improperly
use or disclose any  proprietary  information  or trade secrets of any former or
current   employer  or  other  person  or  entity  with  which   CONTRACTOR   or
EPRIsolutions  has an agreement or duty to keep in  confidence;  and  CONTRACTOR
will not bring onto the premises of  EPRIsolutions  any unpublished  document or
proprietary  information  belonging to such  employer,  person or entity  unless
consented to in writing by such employer, person or entity.

         7.4  Court Order. In the event  documents  related to the Technology or
other documents  relating to this Agreement are subpoenaed or otherwise required
to be  produced  or made  available  to a third  party  by  order  of a court or
governmental  administrative  agency, the disclosing party shall promptly notify
the other in writing and allow twenty (20) days from  receipt by the  disclosing
party of such notice, for response by the disclosing party before producing such
documents.  Each party will  cooperate  with the other in obtaining a protective
court  order  or  take  such  other  action  as may  be  appropriate  under  the
circumstances.


ARTICLE  8 -  Indemnification
-----------------------------

         CONTRACTOR will protect, defend, indemnify and hold EPRIsolutions,  and
any  EPRIsolutions-arranged  cofunder(s),  harmless  from and against any claim,
lawsuit or other proceeding,  loss, cost,  liability or expense (including court
costs and reasonable fees of attorneys and other  professionals)  arising out of
or  resulting  from:  (i) any claim that the  exercise of the rights  granted to
EPRIsolutions  herein  infringes any proprietary  right of any third party,  and
(ii) any  negligent  act or failure to act of  CONTRACTOR,  its  subcontractors,
agents,  or  employees  in  connection  with or related to the  Services  or the
performance thereof under this Agreement,  except for losses, costs, liabilities
or expenses due to  EPRIsolutions',  or any  EPRIsolutions-arranged  cofunder's,
negligence.

                                       4
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ARTICLE  9 -  Insurance
-----------------------

         9.1  Evidence of Coverage Immediately  after the effective date of this
agreement  and  prior  to  commencing   work,   CONTRACTOR,   and  each  of  its
subcontractors  shall furnish to  EPRIsolutions  certificates of insurance,  the
types and amounts of coverage in limits not less than those  specified below and
expiration   date(s)  of  each   applicable   policy.   CONTRACTOR   shall  name
EPRIsolutions  as  additional  insured  under  each  applicable  policy  and the
certificate shall include a provision requiring  CONTRACTOR's  insurers or their
agents  to  give  EPRIsolutions   thirty  (30)  days  written  notice  prior  to
cancellation, nonrenewal, or material alteration of any policy. CONTRACTOR shall
notify  EPRIsolutions  immediately of any  cancellation or change in coverage in
such  policy  or  policies.  The  cost of such  insurance  shall be borne by the
CONTRACTOR.

         Certificates of Insurance  identifying the Purchase Order shall be sent
to:

                                      EPRIsolutions, Inc.
                                      Attn:  Contracts Manager
                                      3412 Hillview Avenue
                                      Palo Alto, CA  94304

         9.2  Social Insurance.  CONTRACTOR and  EPRIsolutions  shall obtain and
maintain Workers' Compensation insurance, State Disability insurance, and/or all
other Social  Insurance for their  respective  employees in accordance  with the
statutory  requirements  of the  jurisdiction  in  which  the  Services  will be
performed.

         9.3  Liability  Insurance. CONTRACTOR  shall carry  Commercial  General
Liability insurance,  including Contractual Liability insurance, covering all of
CONTRACTOR's  operations  under  this  Agreement,  with  minimum  limits of five
hundred  thousand   dollars   ($500,000)  per  occurrence,   including   without
limitation, bodily injury, personal injury, and property damage.


ARTICLE  10 - Term and Termination
----------------------------------

         10.1 Term.  The term of this Agreement is set forth in the Schedule and
will continue until the expiration date therein or until the date of termination
as provided below.

         10.2 Termination.   This  Agreement may be terminated for any reason by
EPRIsolutions upon thirty (30) days' written notice to CONTRACTOR.

              (a)  in  the  event  of   default   due  to   non-performance   or
non-delivery by the CONTRACTOR,  CONTRACTOR is obligated to return all milestone
payments or advance funds made to CONTRACTOR by EPRIsolutions.

         10.3  Survival.  Upon such  termination  all  rights  and duties of the
parties toward each other shall cease except:

              (a)  that  EPRIsolutions  shall be obliged to pay,  within  thirty
(30) days of the effective date of termination,  all amounts owing to CONTRACTOR
for earned but unpaid Services and related  expenses (if any) in accordance with
the provisions hereof; and

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              (b)  the  provisions  of Article 2 (Price  and Funds  Limitation),
Article 3 (Invoicing and Payments), Article 5 (CONTRACTOR's  Representations and
Covenants),    Article   6   (Intellectual    Property   Rights),    Article   7
(Confidentiality), Article 8 (Indemnification) Article 9 (Insurance), Article 12
(Dispute Resolution), Article 14 (Property) and Article 15 (Miscellaneous) shall
survive termination of this Agreement.


ARTICLE  11 - Notices
---------------------

         All  notices  or  communications   required  or  permitted  under  this
Agreement shall be in writing and personally  delivered or sent by registered or
certified mail or by telecopy or facsimile  transmission  to the address of each
party  as set  forth  herein  or to such  other  address  as  either  party  may
substitute by written notice to the other.

EPRIsolutions, Inc.                             PowerCo US, Inc.
Attn:  Contracts Manager                        Attn:  Mr. David Moard
3412 Hillview Avenue                            5000 Robert J. Mathews Parkway
P. O. Box 10412                                 El Dorado Hills, CA  95762
Palo Alto, CA  94303                            FAX No.:  916-933-8177
FAX No.:  650-855-8588


Article  12 - Dispute Resolution
--------------------------------

         If a dispute arises out of or relating to this Agreement, or any breach
thereof,  and if such dispute cannot be settled through direct negotiation,  the
parties  shall  submit  the  dispute  to  nonbinding  mediation  with a mediator
mutually  agreed upon by the  parties.  The  mediation  may be  initiated by the
written  request of either  party to the other party and shall  commence  within
fifteen  (15) days of receipt of such  notice,  unless  otherwise  agreed by the
parties.  In the event of the failure of any  mediation,  the  dispute  shall be
submitted to and settled by arbitration  conducted in the County of Santa Clara,
California,  in  accordance  with  the  rules  then in  effect  of the  American
Arbitration  Association by one (1) arbitrator appointed in accordance with such
rules.  The award rendered by the  arbitrators  shall be final and binding,  and
judgment  may be  entered  upon it in any  court  having  jurisdiction  thereof.
Notwithstanding  the foregoing,  the parties may apply to any court of competent
jurisdiction for a temporary restraining order, preliminary injunction, or other
interim or conservatory relief, as necessary, without breach of this arbitration
agreement and without any  abridgment of the powers of the  arbitrators.  Unless
otherwise  directed by CONTRACTOR in writing,  EPRIsolutions  shall  continue to
perform its obligations hereunder during any arbitration or litigation.


ARTICLE  13 - Publicity Releases
--------------------------------

         13.1 Prior  Approval.  CONTRACTOR may not issue any publicity  releases
(including  news releases and  advertising)  relating to this  Agreement and the
Services performed  hereunder (other than a brief announcement upon execution of
this  Agreement)  without  the prior  written  approval of  EPRIsolutions.  Such
approval shall not be unreasonably  withheld.  Any inquiry  CONTRACTOR  receives
from news media concerning this Agreement will be referred to the  EPRIsolutions
Public Information Department for coordination prior to response.

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         13.2 Credit  to   EPRIsolutions.    Any   technical   paper,   article,
publication,  or announcement of advances  generated in connection with Services
performed under this Agreement,  during the Period of Performance or thereafter,
shall give credit to  EPRIsolutions.  Nothing contained in this subarticle shall
be deemed to grant  CONTRACTOR  any license  with  respect to the results of the
Services.


ARTICLE  14 - Property
----------------------

         14.1 Prior Approval. No equipment shall be purchased with EPRIsolutions
funds,  nor shall  any  improvement,  modification  or  construction  of real or
personal  property be made with  EPRIsolutions  funds,  unless such  purchase or
expenditure  has  been  specifically   approved  in  writing  by  EPRIsolutions.
Authorization   for   purchase   shall  not  be   granted,   except  in  unusual
circumstances, for equipment that can have general application to services other
than the Services  hereunder.  Any property  purchased  pursuant to this Article
shall be used only for the performance of the Services.

         14.2 Title.  Title to all tangible  property,  which is purchased  with
EPRIsolutions funds during the performance of this Agreement,  shall vest at the
time of acquisition in  EPRIsolutions.  CONTRACTOR shall identify,  maintain and
dispose of EPRIsolutions property as instructed by EPRIsolutions.

         14.3 Identification.   CONTRACTOR  shall identify each item of property
that has a unit cost of $1,000  or more by a label.  A copy of the then  current
property  list shall be  provided  to  EPRIsolutions'  Corporate  Audit  Manager
annually  during the term of this Agreement and upon  completion of the Services
or termination of this Agreement.


ARTICLE  15 - Miscellaneous
---------------------------

         15.1 Governing  Law. This Agreement  shall be governed by and construed
in accordance  with the laws of the State of  California,  without  reference to
conflict of law principles.

         15.2 Assignment.   This  Agreement may not be assigned,  in whole or in
part, by either party without the prior written consent of the other party.

         15.3 Benefit.   Subject to  Subarticle  15.2 above,  this  Agreement is
binding  upon and  shall  inure to the  benefit  of the  parties  hereto,  their
representatives, successors and permitted assigns.

         15.4 Waiver.  No failure or  successive  failures on the part of either
party, its successors or assigns,  to enforce any covenant or agreement,  and no
waiver or  successive  waivers  on its or their  part of any  condition  of this
Agreement  shall  operate  as  a  discharge  of  such  covenant,  agreement,  or
condition,  or render the same invalid, or impair the right of either party, its
successors  and  assigns,  to  enforce  the same in the event of any  subsequent
breach or breaches by the other party hereto, its successors or assigns.

         15.5 Subcontract Flow-Down Requirements. Except as otherwise authorized
in writing by  EPRIsolutions,  CONTRACTOR will assure that the provisions listed
below are  inserted in all  subcontracts  related to this  Agreement so that the
provisions are  applicable to the  subcontractor  and its  employees:  Article 2
(Price  and Funds  Limitation),  Article  5  (CONTRACTOR's  Representations  and
Covenants),    Article   6   (Intellectual    Property   Rights),    Article   7
(Confidentiality), Article 8 (Indemnification) Article 9 (Insurance), Article 12
(Dispute Resolution), Article 13 (Publicity Releases), Article 14 (Property) and
Article 15 (Miscellaneous).

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         15.6 Entire Agreement.  This Agreement,  including the Schedule and all
other exhibits, attachments or schedules attached hereto, constitutes the entire
Agreement  between  the parties  and  supersedes  all  previous  agreements  and
understandings  relating to the subject matter hereof. This Agreement may not be
altered,  amended, or modified except by a written instrument signed by the duly
authorized representatives of both parties.

         15.7 Effective  Date.  This Agreement shall be effective as of the date
of commencement of the term as set forth in the Schedule.


         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives.


PowerCo US, Inc.                            EPRIsolutions, Inc.

By:  _________________________________      By:  _______________________________

Print Name:  _________________________      Print Name:  Diane M. Babcock

Title:  ______________________________      Title:  Contracts Manager

Date: ________________________________      Date: ______________________________


                                       8
<PAGE>

SA-SCHED
                                                              Proj. No.:  053649



                         SCHEDULE TO SERVICES AGREEMENT

                                     between

                               EPRIsolutions, Inc.

                                       and

                                PowerCo US, Inc.

                                (EC-P1204/C3714)

                 "Assessment of 3 kW Stirling Engine/Generator"

    This Schedule to Services  Agreement  between  EPRIsolutions and CONTRACTOR,
hereby  incorporates  by reference  those terms and  conditions of the Agreement
between the parties.


1.     Scope of Services

       1.1      Introduction
                ------------

                PowerCo the  marketing  and  business  development  arm of Ocean
                Power  has the  North  American  rights  to sell and  distribute
                Stirling engines for the distributed  generation  market.  Sigma
                Elektroteknisk  of Norway is a developer of Stirling  engines in
                Europe and is a  subsidiary  of Ocean Power.  EPRIsolutions  and
                Ocean  Power  /PowerCo  wish  to  collaborate  on the  test  and
                evaluation of market entry Stirling Engines and pilot the market
                introduction of beta systems to North American energy companies.

                As part of the first  phase of the  market  entry roll out plan,
                EPRIsolutions  wishes to conduct a  technology  assessment,  and
                baseline  testing  and  validation  of  a  Sigma  beta  Stirling
                engine-generator.   Such  tests  and  assessments  will  provide
                information for energy  companies  considering  participation in
                the beta  program  and  provide  data on the  robustness  of the
                technology;  its ability to achieve targeted  performance goals,
                and operational characteristics.

       1.2      Objectives:
                ----------

                The  objective  of this  effort  is to test and  evaluate  Sigma
                Stirling Engine via testing of a 3 kW engine generator.

       1.3      Scope of Work/Task Description:
                ------------------------------

                A.    Task 1: Procure and ship a 3 kW Stirling  Engine.  In this
                      task PowerCo  will deliver and arrange  shipping of a 3 kW
                      Stirling engine to EPRI's EPRI-Peac facility in Knoxville,
                      Tn.  The  specification  for the  unit  and  the  standard
                      package is detailed in Attachment A. PowerCo's  conditions
                      for this unit are outlined in Attachment A.

                                       9
<PAGE>

                      Task 1  Deliverable:  Delivery of a 3 kW  Stirling  Engine
                      Generator to EPRI-Peac  test  facility.  Installation  and
                      Operating   Manual   identifying    detailed   performance
                      specifications   of   the   unit   including   anticipated
                      efficiency, thermal output and operational envelope.

                B.    Task 2: Baseline Tests of  Residential  Fuel Cell Systems.
                      EPRI-PEAC  under  contract to  EPRIsolutions  will conduct
                      baseline  tests  based  on a  test  plan  to be  developed
                      between the parties.

                      EPRIsolutions  will  develop  the test plan and  review it
                      with PowerCo prior to start of baseline testing. EPRI-Peac
                      will  conduct  baseline  testing:   including  performance
                      (efficiency), emissions, power quality and interconnection
                      tests related to IEEE 1547. The length of the test program
                      shall not exceed 6 months.

                      Task 2  Deliverable.  Test  plan  .  Monthly  test  report
                      summaries.

                C.    Task 3:  Reporting

                      EPRIsolutions  shall  prepare  and  deliver a draft  final
                      report at the conclusion of the testing effort. The report
                      shall include:

                      1.   A  description  of  the  Stirling  Engine  technology
                           (information to be provided by PowerCo)

                      2.   Status of the technology development effort

                      3.   Description of the 3 kW system test plan,  objectives
                           and test results.

                      4.   Test  data  and  operational   results  and  findings
                           including:

                           -   electrical and thermal efficiency

                           -   electrical    power    quality   and    transient
                               characteristics

                           -   thermal energy quality

                           -   start-up  and shut down characteristics

                           -   assessment of reliability and availability

                           -   Environmental    emissions   and   noise   (noise
                               measurements  may be misleading  given the engine
                               container enclosure)

                      5.   Assess     design    codes    and    standards    for
                           installation/operation

                      6.   Future R&D needs, issues and gaps prior to commercial
                           use.

                      7.   Description  of  the  beta  unit  program,  schedule,
                           pricing (PowerCo)

                      A draft  report  shall be  delivered to PowerCo for review
                      and comment prior to release to EPRIsolution's members.


2.     project management & Key personnel

       2.1      David Moard may be reached at 916-933-8100 and is the key person
                for performance of the Services under this Agreement.

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<PAGE>

       2.2      The designated  EPRIsolutions Project Manager for this Agreement
                is David Thimsen, who may be reached at 650-855-651-592-6799.


3.     Term

       The  period  of  performance  ("Term")  of this  Agreement  shall be from
       November 1, 2001 through  December 31, 2002,  unless  terminated  earlier
       under the provisions of Article 10 of the Agreement.


4.     FIRM FIXED PRICE

       4.1      The  total  Firm  Fixed  Price  is  $79,000  for  the  lease  of
                equipment, services and shipping costs.

       4.2      Milestone  Payment  Schedule:  Invoices  shall be  approved  for
                payment after  completion  and  acceptance  of the  Milestone(s)
                below.
<TABLE>
<CAPTION>
                Milestone                                                                 Date               Amount
                ---------                                                                 ----               ------
<S>                                                                                 <C>                     <C>
                Start of Project                                                    November 1, 2001        $35,550
                Delivery of Stirling Generator set                                    June 1, 2002          $35,550
                Six (6) months after delivery of Stirling Generator set             December 1, 2002         $7,900
</TABLE>

       4.3      All invoices shall make  reference to this Agreement  number No.
                EC-P1204/C3714  and  shall be  mailed  to  EPRIsolutions  at the
                following address:

                                    EPRIsolutions, Inc.
                                    Attn:  Accounts Payable
                                    3412 Hillview Avenue
                                    P.O. Box 10412
                                    Palo Alto, CA  94303


5.     Technical/Administrative Reports

       5.1      The CONTRACTOR shall submit to the EPRIsolutions Project Manager
                on a monthly basis  technical  progress  reports with respect to
                the  Services  in the format set forth in  Attachment  B to this
                Agreement.

       5.2      EPRIsolutions   interim  and  final  reports   prepared  by  the
                CONTRACTOR   under  this   Agreement   shall  be   submitted  to
                EPRIsolutions  in the form of electronic  computer media such as
                floppy disk in accordance with the EPRIsolutions required format
                at the time of the report preparation.  Current format available
                at  website   www.epri.com   or  telephone   800-492-4882.   The
                electronic  files shall be virus  checked and  accompanied  by a
                hard  copy  printout  that  will be used  by  EPRIsolutions  for
                verification  purposes  only.  Failure  to  comply  with  report
                preparation requirements shall be corrected by CONTRACTOR at its
                sole expense.

       5.3      Unless an  exception  is granted  in  writing by  EPRIsolutions,
                CONTRACTOR shall use both units of modernized metric system (SI)
                and "English" or typical trade  measurement  equivalents  in all

                                       11
<PAGE>

                reports and technical  papers.  The more commonly used unit will
                be shown first, followed by the less common unit in parentheses.
                However,  express authority is provided for use of the following
                standard units of measurement without a metric equivalent:

                      Btu
                      Barrel (of oil or oil substitute)
                      Ton (short) of coal or coal equivalent
                      Standard Cubic Foot (gas) (60(degree)F at 1 atmosphere)


6.     FINAL RELEASE

       6.1      Upon completion of the Services,  and EPRIsolutions'  receipt of
                all deliverables in compliance with this Agreement,  or upon any
                earlier   termination   hereof,   Contractor   will  provide  to
                EPRIsolutions  a mutually  acceptable  release of  EPRIsolutions
                from all contract claims and obligations hereunder.

                                       12
<PAGE>

                                  Attachment A

                    PowerCo Stirling Engine Procurement Scope
                    -----------------------------------------

1.       PowerCo will provide a complete and functional 3 kW generator.

2.       PowerCo will ship the unit to EPRI-Peac test facility in Knoxville, Tn.

                   Stirling Engine Generator Specification package requirements:
                   ------------------------------------------------------------

                   A.    Complete  SI-76  Stirling  PCP with  burner  and engine
                         control

                   B.    Complete  container  with  separate  control  room  and
                         personnel  access  door.  Container  is an ISO shipping
                         container  (10' x 8'6"  x 8' L x H x W)  with  estimate
                         weight of 4500 lbs.

                   C.    110V basic installation (lighting)

                   D.    Cooling system with necessary pumps and cooler

                   E.    Computer control system for operation and data logging

                   H.    Natural gas system with piping and valves

                   I.    Safety system, pressure release and fire alarm

                   J.    Installation, and Operating Manuel.

3.       Title of the unit will remain with PowerCo.

4.       PowerCo will provide all  maintenance and service  requirements  during
         the 6-month lease period.

5.       Operating limits and specifications shall be provided and reviewed with
         the EPRI-Peac test engineer.

6.       PowerCo shall provide support as needed for installation, start-up, and
         normal operation.

         Additional Terms of Agreement

               1.  EPRIsolutions  is responsible  for  installation  per PowerCo
                   requirements.

               2.  EPRIsolutions shall make test data and information  available
                   to PowerCo via informal  monthly  reports and provide a final
                   report.

               3.  EPRIsolutions  will be responsible for the cost of any repair
                   of  equipment  as a result of  miss-use  outside  the  normal
                   operating  range.  PowerCo.  will review with  EPRI-PEAC test
                   engineer the normal operating limits for the system.

               4.  EPRIsolutions  will  receive an option in the form of Powerco
                   U.S.,  Inc. stock warrants for a value equal to the equipment
                   lease  $75,000.00,  exercisable after return of the equipment
                   to CONTRACTOR and any time after conclusion of the program at
                   the market value at the time of exercise.

                                       13