Filed by Automated Filing Services Inc. (604) 609-0244 - Form 5D





     

FORM 5D

  ESCROW AGREEMENT  

  (VALUE SECURITY)  

 THIS AGREEMENT is made as of the 19th day of December, 2003

	AMONG: 	U.S. GEOTHERMAL INC. (formerly U.S. COBALT INC.)
        a Delaware corporation having an office at 1509 Tyrell Lane, Suite B,
        Boise, Idaho, 83706

      (the “Issuer”) 

	 	 
	AND: 	PACIFIC CORPORATE TRUST COMPANY, having an office
        at 10th Floor, 625 Howe Street, Vancouver, British Columbia, V6C 3B8

      (the “Escrow Agent”) 

	 	 
	AND: 	 
	 	EACH OF THE UNDERSIGNED SECURITYHOLDERS OF THE ISSUER 
        (a “Securityholder” or “you”)

      (collectively, the “Parties”) 



This Agreement is being entered into by the Parties
  under TSX Venture Exchange (the “Exchange”) Policy 5.4 -
  Escrow, Vendor Consideration and Resale Restrictions (the “Policy”)
  in connection with a Qualifying Transaction. The Issuer is a Tier 2 Issuer
  as described in Policy 2.1 - Minimum Listing Requirements. 

 For good and valuable consideration, the Parties agree
  as follows: 

PART 1          ESCROW
  

1.1          Appointment
  of Escrow Agent  

 The Issuer and the Securityholders appoint the Escrow Agent
  to act as escrow agent under this Agreement. The Escrow Agent accepts the appointment.


	 
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 1.2          Deposit of Escrow
  Securities in Escrow 

	(1)	You are depositing the securities (“escrow
        securities”) listed opposite your name in Schedule “A”
        with the Escrow Agent to be held in escrow under this Agreement. You will
        immediately deliver or cause to be delivered to the Escrow Agent any share
        certificates or other evidence of these securities which you have or which
        you may later receive. 

	 	 
	(2) 	If you receive any other securities (“additional escrow securities”):
    
	 	 


	 	(a) 	as a dividend or other distribution on escrow securities; 
	 	 	 
	 	(b) 	on the exercise of a right of purchase, conversion
        or exchange attaching to escrow securities, including securities received
        on conversion of special warrants; 

	 	 	 
	 	(c) 	on a subdivision, or compulsory or automatic conversion
        or exchange of escrow securities; or 

	 	 	 
	 	(d) 	from a successor issuer in a business combination,
        if Part 6 of this Agreement applies,

	 	 	 
	 	you will deposit them in
        escrow with the Escrow Agent. You will deliver or cause to be delivered
        to the Escrow Agent any share certificates or other evidence of those
        additional escrow securities. When this Agreement refers to escrow securities,
        it includes additional escrow securities. 

	 	 


	(3) 	You will immediately deliver to the Escrow Agent
        any replacement share certificates or other evidence of additional escrow
        securities issued to you. 



1.3           Direction to
  Escrow Agent 

 The Issuer and the Securityholders direct the Escrow Agent
  to hold the escrow securities in escrow until they are released from escrow
  under this Agreement. 

 PART 2           RELEASE OF
  ESCROW SECURITIES  

 2.1           Release Provisions



The provisions of Schedule(s) B(2) Value Security Escrow Agreement for Tier 2 Issuer and B(1) Value Security Escrow Agreement for Tier 1 Issuer are incorporated into and form part of this Agreement.


 2.2          Additional Escrow
  Securities  


If you acquire additional escrow securities in connection with the transaction to which this agreement relates, those securities will be added to the securities already in escrow, to increase


	 
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 the number of remaining escrow securities. After that, all
  of the escrow securities will be released in accordance with the applicable
  release schedule. 

 2.3           Additional Requirements
  for Tier 2 Surplus Escrow Securities  

 Where securities are subject to a Tier 2 Surplus Security
  Escrow Agreement Schedule B(4), the following additional conditions apply:

	(1) 	The escrow securities will be cancelled if the asset,
        property, business or interest therein in consideration of which the securities
        were issued, is lost, or abandoned, or the operations or development of
        such asset, property or business is discontinued. 

	 	 
	(2) 	The Escrow Agent will not release escrow securities
        from escrow under schedule B(4) unless the Escrow Agent has received,
        within the 15 days prior to the release date, a certificate from the Issuer
        that: 

	 	 


	 	(a) 	is signed by two directors or officers of the Issuer;
      

	 	 	 
	 	(b)	 is dated not more than 30 days prior to the release
        date; 

	 	 	 
	 	(c) 	states that the assets for which the escrow securities
        were issued (the “Assets”) were included as assets on the balance
        sheet of the Issuer in the most recent financial statements filed by the
        Issuer with the Exchange; and 

	 	 	 
	 	(d) 	states that the Issuer has no reasonable knowledge
        that the Assets will not be included as assets on the balance sheet of
        the Issuer in the next financial statements to be filed by the Issuer
        with the Exchange.

	 	 	 


	(3) 	If, at any time during the term of this Agreement,
        the Escrow Agent is prohibited from releasing escrow securities on a release
        date specified schedule B(4) as a result of section 2.3(2) above, then
        the Escrow Agent will not release any further escrow securities from escrow
        without the written consent of the Exchange. 

	 	 
	(4) 	If as a result of this section 2.3, the Escrow Agent
        does not release escrow securities from escrow for a period of five years,
        then: 

	 	 


	 	 (a) 
	the Escrow Agent will deliver a notice to the Issuer,
        and will include with the notice any certificates that the Escrow Agent
        holds which evidence the escrow securities; and 

      
	 	 	 
	 	 (b)

	 the Issuer and the Escrow Agent will take such action as is necessary
        to cancel the escrow securities. 

      
	 	 	 


	 (5) 

	For the purposes of cancellation of escrow securities
        under this section, each Securityholder irrevocably appoints the Escrow
        Agent as his or her attorney, with authority to appoint substitute attorneys,
        as necessary. 

      




	 
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 2.4           Delivery of
  Share Certificates for Escrow Securities 

 The Escrow Agent will send to each Securityholder any share
  certificates or other evidence of that Securityholder’s escrow securities
  in the possession of the Escrow Agent released from escrow as soon as reasonably
  practicable after the release. 

 2.5          
  Replacement Certificates 

 If, on the date a Securityholder’s escrow securities
  are to be released, the Escrow Agent holds a share certificate or other evidence
  representing more escrow securities than are to be released, the Escrow Agent
  will deliver the share certificate or other evidence to the Issuer or its transfer
  agent and request replacement share certificates or other evidence. The Issuer
  will cause replacement share certificates or other evidence to be prepared and
  delivered to the Escrow Agent. After the Escrow Agent receives the replacement
  share certificates or other evidence, the Escrow Agent will send to the Securityholder
  or at the Securityholder’s direction, the replacement share certificate
  or other evidence of the escrow securities released. The Escrow Agent and Issuer
  will act as soon as reasonably practicable. 

 2.6           Release upon
  Death 

	(1) 	If a Securityholder dies, the Securityholder’s
        escrow securities will be released from escrow. The Escrow Agent will
        deliver any share certificates or other evidence of the escrow securities
        in the possession of the Escrow Agent to the Securityholder’s legal
        representative provided that: 

	 	 


	 	(a) 	the legal representative of the deceased Securityholder
        provides written notice to the Exchange of the intent to release the escrow
        securities as at a specified date which is at least 10 business days and
        not more than 30 business days prior to the proposed release; and 

	 	 	 
	 	(b)	 the Exchange does not provide notice of its objection
        to the Escrow Agent prior to 10:00 a.m. (Vancouver time) or 11:00 a.m.
        (Calgary time) on such specified date. 

	 	 	 


	(2) 	Prior to delivery the Escrow Agent must receive: 
	 	 


	 	(a) 	a certified copy of the death certificate; and 
	 	 	 
	 	(b) 	any evidence of the legal representative’s status
        that the Escrow Agent may reasonably require. 



2.7           Exchange Discretion
  to Terminate  

 If the Escrow Agent receives a request from the Exchange to
  halt or terminate the release of escrow securities from escrow, then the Escrow
  Agent will comply with that request, and will not release any escrow securities
  from escrow until it receives the written consent of the Exchange. 

	 
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 2.8           Discretionary
  Applications  

 The Exchange may consent to the release from escrow of escrow
  securities in other circumstances and on terms and on conditions it deems appropriate.
  Securities may be released from escrow provided that the Escrow Agent receives
  written notice from the Exchange. 

 PART 3           EARLY RELEASE
  ON CHANGE OF ISSUER STATUS  

 3.1          Early Release
  – Graduation to Tier 1 

	(1) 	When a Tier 2 Issuer becomes a Tier 1 Issuer, the
        release schedule for its escrow securities changes. 

	 	 
	(2)	 If the Issuer reasonably believes that it meets
        the Minimum Listing Requirements of a Tier 1 Issuer as described in Policy
        2.1 – Minimum Listing Requirements, the Issuer may make
        application to the Exchange to be listed as a Tier 1 Issuer. The Issuer
        must also concurrently provide notice to the Escrow Agent that it is making
        such an application. 

	 	 
	(3)	 If the graduation to Tier 1 is accepted by the Exchange,
        the Exchange will issue an Exchange Bulletin confirming final acceptance
        for listing of the Issuer on Tier 1. Upon issuance of this Bulletin the
        Issuer must immediately: 

	 	 


	 	(a)	 issue a news release: 
	 	 	 


	 	 	(i) 	disclosing that it has been accepted for graduation to Tier 1; and 
	 	 	 	 
	 	 	(ii) 	disclosing the number of escrow securities to be
        released and the dates of release under the new schedule; and 

	 	 	 	 
	 	(b)	 provide the news release, together with a copy
      of the Exchange Bulletin, to the Escrow Agent. 
	 	 	 	 


	(4) 	Upon completion of the steps in section 3.1(3) above,
        the Issuer’s release schedule will be replaced as follows: 





	Applicable Schedule Pre-Graduation	Applicable Schedule Post-Graduation
	Schedule B(2)	Schedule B(1)




	(5) 	Within 10 days of the Exchange Bulletin confirming
        the Issuer’s listing on Tier 1, the Escrow Agent must release any
        escrow securities from escrow securities which under the new release schedule
        would have been releasable at a date prior to the Exchange Bulletin. 



PART 4           DEALING WITH
  ESCROW SECURITIES  

 4.1           Restriction
  on Transfer, etc.  

 Unless it is expressly permitted in this Agreement, you will
  not sell, transfer, assign, mortgage, enter into a derivative transaction concerning,
  or otherwise deal in any way with your escrow 

	 
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 securities or any related share certificates or other evidence
  of the escrow securities. If a Securityholder is a private company controlled
  by one or more Principals of the Issuer, the Securityholder may not participate
  in a transaction that results in a change of its control or a change in the
  economic exposure of the Principals to the risks of holding escrow securities.


 4.2          Pledge,
  Mortgage or Charge as Collateral for a Loan  

 Subject to Exchange acceptance, you may pledge, mortgage or
  charge your escrow securities to a financial institution as collateral for a
  loan, provided that no escrow securities or any share certificates or other
  evidence of escrow securities will be transferred or delivered by the Escrow
  Agent to the financial institution for this purpose. The loan agreement must
  provide that the escrow securities will remain in escrow if the lender realizes
  on the escrow securities to satisfy the loan. 

 4.3          
  Voting of Escrow Securities  

 Although you may exercise voting rights attached to your escrow
  securities, you may not, while your securities are held in escrow, exercise
  voting rights attached to any securities (whether in escrow or not) in support
  of one or more arrangements that would result in the repayment of capital being
  made on the escrow securities prior to a winding up of the Issuer. 

 4.4          
  Dividends on Escrow Securities  

 You may receive a dividend or other distribution on your escrow
  securities, and elect the manner of payment from the standard options offered
  by the Issuer. If the Escrow Agent receives a dividend or other distribution
  on your escrow securities, other than additional escrow securities, the Escrow
  Agent will pay the dividend or other distribution to you on receipt. 

 4.5          
  Exercise of Other Rights Attaching to Escrow Securities  

 You may exercise your rights to exchange or convert your escrow
  securities in accordance with this agreement. 

 PART 5          
  PERMITTED TRANSFERS WITHIN ESCROW  

 5.1          
  Transfer to Directors and Senior Officers

	(1)	 You may transfer escrow
        securities within escrow to existing or, upon their appointment, incoming
        directors or senior officers of the Issuer or any of its material operating
        subsidiaries, if the Issuer’s board of directors has approved the
        transfer and provided that: 

	 	 	 
	 	(a)	 you make application to transfer under the Policy
        at least 10 business days and not more than 30 business days prior to
        the date of the proposed transfer; and 

	 	 	 
	 	(b)	 the Exchange does not provide notice of its objection
        to the Escrow Agent prior to 10:00 a.m. (Vancouver time) or 11:00 a.m.
        (Calgary time) on such specified date. 





	 
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	(2)
   	Prior to the transfer the
        Escrow Agent must receive:

         

	 	(a)

          
	a certified copy of the
        resolution of the board of directors of the Issuer approving the transfer;

         

	 	(b)

          
	a certificate signed by
        a director or officer of the Issuer authorized to sign, stating that the
        transfer is to a director or senior officer of the Issuer or a material
        operating subsidiary and that any required acceptance from the Exchange
        the Issuer is listed on has been received;

         

	 	(c)

          
	an acknowledgment in the
        form of Form 5E signed by the transferee; and

         

	 	(d)

          
	a transfer power of attorney,
        completed and executed by the transferor in accordance with the requirements
        of the Issuer’s transfer agent.

         

	5.2          
      Transfer to Other Principals
  
	(1)
   	You may transfer escrow
        securities within escrow:

         

	 	(a)

          
	to a person or company that
        before the proposed transfer holds more than 20% of the voting rights
        attached to the Issuer’s outstanding securities; or

         

	 	(b)

          
	to a person or company that
        after the proposed transfer

         

	 	 	(i)

          
	will hold more than 10% of the voting
        rights attached to the Issuer’s outstanding securities, and

         

	 	 	(ii)

          
	has the right to elect or appoint one
        or more directors or senior officers of the Issuer or any of its material
        operating subsidiaries,

      provided that:

         

	 	(c)

          
	you make an application
        to transfer under the Policy at least 10 business days and not more than
        30 business days prior to the date of the proposed transfer; and

         

	 	(d)

          
	the Exchange does not provide
        notice of its objection to the Escrow Agent prior to 10:00 a.m. (Vancouver
        time) or 11:00 a.m. (Calgary time) on such specified date.

         

	(2)
   	Prior to the transfer the
        Escrow Agent must receive:

         

	 	(a)

          
	a certificate signed by
        a director or officer of the Issuer authorized to sign, stating that:

         

	 	 	(i)
	the transfer is to a person or company
        that the officer believes, after reasonable investigation, holds more
        than 20% of the voting rights attached to the Issuer’s outstanding
        securities before the proposed transfer; or



	 
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	 	 	(ii) 	the transfer is to a person
        or company that: 

          

	 	 	 	(A) 	the officer believes, after reasonable investigation,
        will hold more than 10% of the voting rights attached to the Issuer’s
        outstanding securities; and

          

	 	 	 	(B) 	has the right to elect or appoint one or more directors
        or senior officers of the Issuer or any of its material operating subsidiaries
        

          

	 	 	 	after the proposed transfer;
        and

          

	 	 	(iii) 	any required approval from
        the Exchange or any other exchange on which the Issuer is listed has been
        received; 

          

	 	(b) 	an acknowledgment in the
        form of Form 5E signed by the transferee; and 

          

	 	(c) 	a transfer power of attorney,
        completed and executed by the transferor in accordance with the requirements
        of the Issuer’s transfer agent. 



5.3           Transfer upon
  Bankruptcy

	(1)	 You may transfer escrow
        securities within escrow to a trustee in bankruptcy or another person
        or company entitled to escrow securities on bankruptcy provided that:
        

          

	 	(a) 	you make application to
        transfer under the Policy at least 10 business days and not more than
        30 business days prior to the date of the proposed transfer; and 

          

	 	(b) 	the Exchange does not provide
        notice of its objection to the Escrow Agent prior to 10:00 a.m. (Vancouver
        time) or 11:00 a.m. (Calgary time) on such specified date.

          

	(2) 	Prior to the transfer, the
        Escrow Agent must receive: 

          

	 	(a) 	a certified copy of either
        

          

	 	 	(i) 	the assignment in bankruptcy filed with the Superintendent
        of Bankruptcy, or 

          

	 	 	(ii) 	the receiving order adjudging the Securityholder
        bankrupt; 

          

	 	(b) 	a certified copy of a certificate
        of appointment of the trustee in bankruptcy; 

          

	 	(c) 	a transfer power of attorney,
        duly completed and executed by the transferor in accordance with the requirements
        of the Issuer’s transfer agent; and 

          

	 	(d) 	an acknowledgment in the
        form of Form 5E signed by 



	 
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	 	 	(i) 	the trustee in bankruptcy or 

        
	 	 	(ii) 	on direction from the trustee, with evidence of that
        direction attached to the acknowledgement form, another person or company
        legally entitled to the escrow securities.

      


5.4          Transfer Upon
  Realization of Pledged, Mortgaged or Charged Escrow Securities

	(1) 	You may transfer escrow
        securities you have pledged, mortgaged or charged under section 4.2 to
        a financial institution as collateral for a loan within escrow to the
        lender on realization provided that: 

          

	 	(a) 	you make application to transfer under the Policy at
        least 10 business days and not more than 30 business days prior to the
        date of the proposed transfer; and

          

	 	(b) 	the Exchange does not provide notice of its objection
        to the Escrow Agent prior to 10:00 a.m. (Vancouver time) or 11:00 a.m.
        (Calgary time) on such specified date.

          

	(2) 	Prior to the transfer the
        Escrow Agent must receive: 

          

	 	(a) 	a statutory declaration of an officer of the financial
        institution that the financial institution is legally entitled to the
        escrow securities; 

          

	 	(b) 	evidence that the Exchange has accepted the pledge,
        mortgage or charge of escrow securities to the financial institution;
        

          

	 	(c) 	a transfer power of attorney, executed by the transferor
        in accordance with the requirements of the Issuer’s transfer agent;
        and 

          

	 	(d) 	an acknowledgement in the form of Form 5E signed
        by the financial institution. 



5.5          Transfer to Certain
  Plans and Funds

	(1) 	You may transfer escrow securities
        within escrow to or between a registered retirement savings plan (RRSP),
        registered retirement income fund (RRIF) or other similar registered plan
        or fund with a trustee, where the beneficiaries of the plan or fund are
        limited to you and your spouse, children and parents provided that:

          

	 	(a) 	you make application to transfer under the Policy at
        least 10 business days and not more than 30 business days prior to the
        date of the proposed transfer; and 

          

	 	(b) 	the Exchange does not provide notice of its objection
        to the Escrow Agent prior to 10:00 a.m. (Vancouver time) or 11:00 a.m.
        (Calgary time) on such specified date. 

          

	(2) 	Prior to the transfer the
        Escrow Agent must receive: 



	 
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	 	(a) 	evidence from the trustee of the transferee plan
        or fund, or the trustee’s agent, stating that, to the best of the
        trustee’s knowledge, the annuitant of the RRSP or RRIF or the beneficiaries
        of the other registered plan or fund do not include any person or company
        other than you and your spouse, children and parents; 

          

	 	(b) 	a transfer power of attorney, executed by the transferor
        in accordance with the requirements of the Issuer’s transfer agent;
        and 

          

	 	(c) 	an acknowledgement in the form of Form 5E signed by the trustee of the
      plan or fund. 


5.6          Effect of Transfer
  Within Escrow  

 After the transfer of escrow securities within escrow, the
  escrow securities will remain in escrow and released from escrow under this
  Agreement as if no transfer has occurred, on the same terms that applied before
  the transfer. The Escrow Agent will not deliver any share certificates or other
  evidence of the escrow securities to transferees under this Part 5. 

 5.7          Discretionary
  Applications 

 The Exchange may consent to the transfer within escrow of
  escrow securities in other circumstances and on such terms and conditions as
  it deems appropriate. 

 PART 6           BUSINESS
  COMBINATIONS  

 6.1          Business Combinations
   

 This Part applies to the following (“business combinations”):

	(a) 	a formal take-over bid for all outstanding securities
        of the Issuer or which, if successful, would result in a change of control
        of the Issuer 

	(b) 	a formal issuer bid for all outstanding equity securities of the Issuer
    
	(c) 	a statutory arrangement 
	(d) 	an amalgamation 
	(e) 	a merger 
	(f) 	a reorganization that has an effect similar to an amalgamation or merger


 6.2          Delivery to Escrow
  Agent

	(1) 	You may tender your escrow securities to a person
        or company in a business combination. At least five business days prior
        to the date the escrow securities must be tendered under the business
        combination, you must deliver to the Escrow Agent: 



	 
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	 	(a) 	a written direction signed by you that directs the
        Escrow Agent to deliver to the depositary under the business combination
        any share certificates or other evidence of the escrow securities and
        a completed and executed cover letter or similar document and, where required,
        transfer power of attorney completed and executed for transfer in accordance
        with the requirements of the Issuer’s depository, and any other documentation
        specified or provided by you and required to be delivered to the depositary
        under the business combination; 

          

	 	(b) 	written consent of the Exchange; and 

          

	 	(c) 	any other information concerning the business combination
        as the Escrow Agent may reasonably require. 



 6.3           Delivery to
  Depositary

	(1) 	As soon as reasonably practicable,
        and in any event no later than three business days after the Escrow Agent
        receives the documents and information required under section 6.2, the
        Escrow Agent will deliver to the depositary, in accordance with the direction,
        any share certificates or other evidence of the escrow securities, and
        a letter addressed to the depositary that

          

	 	(a) 	identifies the escrow securities that are being tendered;
        

          

	 	(b) 	states that the escrow securities are held in escrow;
        

          

	 	(c) 	states that the escrow securities are delivered only
        for the purposes of the business combination and that they will be released
        from escrow only after the Escrow Agent receives the information described
        in section 6.4;

          

	 	(d) 	if any share certificates or other evidence of the
        escrow securities have been delivered to the depositary, requires the
        depositary to return to the Escrow Agent, as soon as practicable, the
        share certificates or other evidence of escrow securities that are not
        released from escrow into the business combination; and 

          

	 	(e) 	where applicable, requires the depositary to deliver
        or cause to be delivered to the Escrow Agent, as soon as practicable,
        share certificates or other evidence of additional escrow securities that
        you acquire under the business combination. 



6.4          Release of Escrow
  Securities to Depositary

	(1) 	The Escrow Agent will release
        from escrow the tendered escrow securities provided that: 

          

	 	(a) 	you or the Issuer make application to release the
        tendered securities under the Policy on a date at least 10 business days
        and not more than 30 business days prior to the date of the proposed release
        date; and 



	 
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	(b) 	the Exchange does not provide
        notice of its objection to the Escrow Agent prior to 10:00 a.m. (Vancouver
        time) or 11:00 a.m. (Calgary time) on such specified date; 

          

	(c) 	the Escrow Agent receives
        a declaration signed by the depositary or, if the direction identifies
        the depositary as acting on behalf of another person or company in respect
        of the business combination, by that other person or company, that 

          

	 	(i) 	the terms and conditions of the business combination
        have been met or waived; and 

          

	 	(ii) 	the escrow securities have either been taken up and
        paid for or are subject to an unconditional obligation to be taken up
        and paid for under the business combination.



6.5           Escrow of New
  Securities

	(1) 	If you receive securities
        (“new securities”) of another issuer (“successor
        issuer”) in exchange for your escrow securities, the new securities
        will be subject to escrow in substitution for the tendered escrow securities,
        unless, immediately after completion of the business combination, 

          

	 	(a) 	the successor issuer is an exempt issuer as defined
        in the National Policy; 

          

	 	(b) 	the escrow holder was subject to a Value Security
        Escrow Agreement and is not a Principal of the successor issuer; and 

          

	 	(c) 	the escrow holder holds less than 1% of the voting
        rights attached to the successor issuer’s outstanding securities.
        (In calculating this percentage, include securities that may be issued
        to the escrow holder under outstanding convertible securities in both
        the escrow holders securities and the total securities outstanding.) 



6.6          Release from Escrow
  of New Securities

	(1) 	The Escrow Agent will send
        to a Securityholder share certificates or other evidence of the Securityholder’s
        new securities as soon as reasonably practicable after the Escrow Agent
        receives

          

	 	(a) 	a certificate from the successor
        issuer signed by a director or officer of the successor issuer authorized
        to sign 

          

	 	 	(i) 	stating that it is a successor issuer to the Issuer
        as a result of a business combination; 

          

	 	 	(ii) 	containing a list of the securityholders whose new
        securities are subject to escrow under section 6.5; 



	 
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	 	 	(iii) 	containing a list of the securityholders whose new
        securities are not subject to escrow under section 6.5; 

          

	 	(b) 	written confirmation from
        the Exchange that it has accepted the list of Securityholders whose new
        securities are not subject to escrow under section 6.5; and 

          

	(2) 	The escrow securities of
        the Securityholders whose securities are not subject to escrow under section
        6.5, will be released, and the Escrow Agent will send any share certificates
        or other evidence of the escrow securities in the possession of the Escrow
        Agent in accordance with section 2.4. 

          

	(3) 	If your new securities are
        subject to escrow, unless subsection (4) applies, the Escrow Agent will
        hold your new securities in escrow on the same terms and conditions, including
        release dates, as applied to the escrow securities that you exchanged.
        

          

	(4) 	If the Issuer is a Tier
        2 Issuer and the successor issuer is a Tier 1 Issuer, the release provisions
        in section 3.1(4) relating to graduation will apply. 



PART 7           RESIGNATION
  OF ESCROW AGENT  

 7.1          Resignation of
  Escrow Agent

	(1) 	If the Escrow Agent wishes to resign as escrow agent,
        the Escrow Agent will give written notice to the Issuer and the Exchange.
        

          

	(2) 	If the Issuer wishes to terminate the Escrow Agent
        as escrow agent, the Issuer will give written notice to the Escrow Agent
        and the Exchange. 

          

	(3) 	If the Escrow Agent resigns or is terminated, the
        Issuer will be responsible for ensuring that the Escrow Agent is replaced
        not later than the resignation or termination date by another escrow agent
        that is acceptable to the Exchange and that has accepted such appointment,
        which appointment will be binding on the Issuer and the Securityholders.
        

          

	(4) 	The resignation or termination of the Escrow Agent
        will be effective, and the Escrow Agent will cease to be bound by this
        Agreement, on the date that is 60 days after the date of receipt of the
        notices referred to above by the Escrow Agent or Issuer, as applicable,
        or on such other date as the Escrow Agent and the Issuer may agree upon
        (the “resignation or termination date”), provided that the resignation
        or termination date will not be less than 10 business days before a release
        date. 

          

	(5) 	If the Issuer has not appointed a successor escrow
        agent within 60 days of the resignation or termination date, the Escrow
        Agent will apply, at the Issuer’s expense, to a court of competent
        jurisdiction for the appointment of a successor escrow agent, and the
        duties and responsibilities of the Escrow Agent will cease immediately
        upon such appointment.

          

	(6) 	On any new appointment under this section, the successor
        Escrow Agent will be vested 



	 
	FORM 5D	ESCROW AGREEMENT	Page 13

	(as at August 2002)	 	 







 with the same powers, rights, duties
  and obligations as if it had been originally named herein as Escrow Agent, without
  any further assurance, conveyance, act or deed. The predecessor Escrow Agent,
  upon receipt of payment for any outstanding account for its services and expenses
  then unpaid, will transfer, deliver and pay over to the successor Escrow Agent,
  who will be entitled to receive, all securities, records or other property on
  deposit with the predecessor Escrow Agent in relation to this Agreement and
  the predecessor Escrow Agent will thereupon be discharged as Escrow Agent.

	(7) 	If any changes are made to Part 8 of this Agreement
        as a result of the appointment of the successor Escrow Agent, those changes
        must not be inconsistent with the Policy and the terms of this Agreement
        and the Issuer to this Agreement will file a copy of the new Agreement
        with the Exchange. 



PART 8           OTHER CONTRACTUAL
  ARRANGEMENTS  

 8.1           Escrow Agent
  Not a Trustee  

 The Escrow Agent accepts duties and responsibilities under
  this Agreement, and the escrow securities and any share certificates or other
  evidence of these securities, solely as a custodian, bailee and agent. No trust
  is intended to be, or is or will be, created hereby and the Escrow Agent shall
  owe no duties hereunder as a trustee. 

 8.2          Escrow
  Agent Not Responsible for Genuineness  

 The Escrow Agent will not be responsible or liable in any
  manner whatever for the sufficiency, correctness, genuineness or validity of
  any escrow security deposited with it. 

 8.3          Escrow
  Agent Not Responsible for Furnished Information 

 The Escrow Agent will have no responsibility for seeking,
  obtaining, compiling, preparing or determining the accuracy of any information
  or document, including the representative capacity in which a party purports
  to act, that the Escrow Agent receives as a condition to a release from escrow
  or a transfer of escrow securities within escrow under this Agreement. 

 8.4          
  Escrow Agent Not Responsible after Release  

 The Escrow Agent will have no responsibility for escrow securities
  that it has released to a Securityholder or at a Securityholder’s direction
  according to this Agreement. 

 8.5          
  Indemnification of Escrow Agent  

 The Issuer and each Securityholder hereby jointly and severally
  agree to indemnify and hold harmless the Escrow Agent, its affiliates, and their
  current and former directors, officers, employees and agents from and against
  any and all claims, demands, losses, penalties, costs, expenses, fees and liabilities,
  including, without limitation, legal fees and expenses, directly or indirectly
  arising out of, in connection with, or in respect of, this Agreement, except
  where same result directly and principally from gross negligence, wilful misconduct
  or bad faith on the part 

	 
	FORM 5D	ESCROW AGREEMENT	Page 14

	(as at August 2002)	 	 










 of the Escrow Agent. This indemnity survives the release of
  the escrow securities, the resignation or termination of the Escrow Agent and
  the termination of this Agreement. 

 8.6          Additional Provisions
   

 (1) The Escrow Agent will be protected in acting and relying
  reasonably upon any notice, direction, instruction, order, certificate, confirmation,
  request, waiver, consent, receipt, statutory declaration or other paper or document
  (collectively referred to as “Documents”) furnished to it and
  purportedly signed by any officer or person required to or entitled to execute
  and deliver to the Escrow Agent any such Document in connection with this Agreement,
  not only as to its due execution and the validity and effectiveness of its provisions,
  but also as to the truth or accuracy of any information therein contained, which
  it in good faith believes to be genuine. 

 (2) The Escrow Agent will not be bound by any notice of a
  claim or demand with respect thereto, or any waiver, modification, amendment,
  termination or rescission of this Agreement unless received by it in writing,
  and signed by the other Parties and approved by the Exchange, and, if the duties
  or indemnification of the Escrow Agent in this Agreement are affected, unless
  it has given its prior written consent. 

 (3) The Escrow Agent may consult with or retain such legal
  counsel and advisors as it may reasonably require for the purpose of discharging
  its duties or determining its rights under this Agreement and may rely and act
  upon the advice of such counsel or advisor. The Escrow Agent will give written
  notice to the Issuer as soon as practicable that it has retained legal counsel
  or other advisors. The Issuer will pay or reimburse the Escrow Agent for any
  reasonable fees, expenses and disbursements of such counsel or advisors. 

 (4) In the event of any disagreement arising under the terms
  of this Agreement, the Escrow Agent will be entitled, at its option, to refuse
  to comply with any and all demands whatsoever until the dispute is settled either
  by a written agreement among the Parties or by a court of competent jurisdiction.


 (5) The Escrow Agent will have no duties or responsibilities
  except as expressly provided in this Agreement and will have no duty or responsibility
  under the Policy or arising under any other agreement, including any agreement
  referred to in this Agreement, to which the Escrow Agent is not a party. 

 (6) The Escrow Agent will have the right not to act and will
  not be liable for refusing to act unless it has received clear and reasonable
  documentation that complies with the terms of this Agreement. Such documentation
  must not require the exercise of any discretion or independent judgment. 

 (7) The Escrow Agent is authorized to cancel any share certificate
  delivered to it and hold such Securityholder’s escrow securities in electronic,
  or uncertificated form only, pending release of such securities from escrow.


 (8) The Escrow Agent will have no responsibility with respect
  to any escrow securities in respect of which no share certificate or other evidence
  or electronic or uncertificated form of 

	 
	FORM 5D	ESCROW AGREEMENT	Page 15

	(as at August 2002)	 	 











these securities has been delivered to it, or otherwise received by it.


 8.7          Limitation of
  Liability of Escrow Agent  

 The Escrow Agent will not be liable to any of the Parties
  hereunder for any action taken or omitted to be taken by it under or in connection
  with this Agreement, except for losses directly, principally and immediately
  caused by its bad faith, wilful misconduct or gross negligence. Under no circumstances
  will the Escrow Agent be liable for any special, indirect, incidental, consequential,
  exemplary, aggravated or punitive losses or damages hereunder, including any
  loss of profits, whether foreseeable or unforeseeable. Notwithstanding the foregoing
  or any other provision of this Agreement, in no event will the collective liability
  of the Escrow Agent under or in connection with this Agreement to any one or
  more Parties, except for losses directly caused by its bad faith or wilful misconduct,
  exceed the amount of its annual fees under this Agreement or the amount of three
  thousand dollars ($3,000.00), whichever amount shall be greater. 

 8.8           Remuneration
  of Escrow Agent 

 The Issuer will pay the Escrow Agent reasonable remuneration
  for its services under this Agreement, which fees are subject to revision from
  time to time on 30 days' written notice. The Issuer will reimburse the Escrow
  Agent for its expenses and disbursements. Any amount due under this section
  and unpaid 30 days after request for such payment, will bear interest from the
  expiration of such period at a rate per annum equal to the then current rate
  charged by the Escrow Agent, payable on demand. 

 8.9           Additional Escrow
  Release Requirements  

 (1) Notwithstanding that the escrow release provisions set
  forth in Section 2.1 shall have been satisfied, the following additional restrictions
  shall apply to the escrow securities:


	 	(a) 	no more than two-thirds of the original number of
          escrow securities deposited into escrow by Vulcan Power Company under
          this Agreement shall be released prior to the commencement of construction
          of a power plant at the at the Issuer’s Raft River geothermal project
          in Cassia County, Idaho; 

            

	 	(b) 	all of the escrow securities deposited into escrow
          by the individuals named below shall be released from escrow upon satisfaction
          of the release provisions set forth in Section 2.1 except for that number
          of escrow securities set forth in column A below, which will continue
          to be held in escrow under this Agreement and released in two tranches
          as set forth in columns B below and C below: 

            



	 	A	B	C
	   Name	Total	First Tranche	Second Tranche
	Daniel Kunz	314,290	235,750	78,540
	Douglas Glaspey	285,720	214,300	71,420




	 
	FORM 5D	ESCROW AGREEMENT	Page 16

	(as at August 2002)	 	 






 


  	 	A	B	C
	   Name	Total	First Tranche	Second Tranche
	Paul Larkin	171,425	128,560	42,865
	Ron Bourgeois	171,425	128,560	42,865
	John Walker	57,140	42,830	14,310
	      Total:	1,000,000	750,000	250,000


   

	 	 	The first tranche will be released at such time as
        the Issuer has: (i) obtained all material permits and licenses necessary
        to authorize the Issuer, or an affiliate of the Issuer, to begin construction
        of a 10 megawatt power plant, (ii) entered into a power purchase agreement
        to sell at standard commercial prices the power to be generated by such
        power plant, and (iii) entered into a power transmission agreement to
        transmit the power to be generated by such power plant, provided all of
        the foregoing shall have occurred by June 19, 2005. 

       The second tranche will be released at such time as
        the Issuer has: (i) obtained all material permits and licenses necessary
        to authorize the Issuer, or an affiliate of the Issuer, to begin construction
        of (or to expand its existing facility or authorization to) a 15 megawatt
        power plant, (ii) entered into a power purchase agreement to sell at standard
        commercial prices the power to be generated by such power plant, and (iii)
        entered into a power transmission agreement to transmit the power to be
        generated by such power plant, provided all of the foregoing shall have
        occurred by December 19, 2005; 

          

	 	(c) 	if the release criteria set forth in subsections 8.9
        (1) (a) or (b) above are not satisfied, the escrow securities subject
        to such criteria, as applicable, shall be returned to the Issuer and cancelled;

          

	 	(d) 	for the purposes of determining whether or not subsections
        8.9 (1) (a) and (b) above have or have not been satisfied, the Escrow
        Agent shall be entitled to rely on a statutory declaration of an independent
        director of the Issuer confirming that the release criteria set forth
        in subsection (a) or (b) have or have not been satisfied, as the case
        may be. The Escrow Agent shall promptly provide a copy of each statutory
        declaration that it receives pursuant to this subsection to the Issuer
        and to each holder of escrow securities under this Agreement. For the
        purposes hereof, a director is not independent if the director or a shareholder
        that has appointed the director will receive a release of escrowed securities
        as a consequence of the Escrow Agent relying on the statutory declaration
        sworn by such director; and 

          

	 	(e) 	the Escrow Agent shall wait five business days after
        receiving any statutory declaration pursuant to this section 8.9 before
        taking any action in respect thereof, other than sending copies of the
        statutory declaration to the Issuer and each holder of escrow securities
        under this Agreement.



	 
	FORM 5D	ESCROW AGREEMENT	Page 17

	(as at August 2002)	 	 







 PART 9           INDEMNIFICATION
  OF THE EXCHANGE  

 9.1           Indemnification

	(1) 	The Issuer and each Securityholder
        jointly and severally: 

          

	 	(a) 	release, indemnify and save harmless the Exchange
        from all costs (including legal cost, expenses and disbursements), charges,
        claims, demands, damages, liabilities, losses and expenses incurred by
        the Exchange; 

          

	 	(b) 	agree not to make or bring a claim or demand, or
        commence any action, against the Exchange; and 

          

	 	(c) 	agree to indemnify and save harmless the Exchange
        from all costs (including legal costs) and damages that the Exchange incurs
        or is required by law to pay as a result of any person’s claim, demand
        or action, 

          

	 	arising from any and every
        act or omission committed or omitted by the Exchange, in connection with
        this Agreement, even if said act or omission was negligent, or constituted
        a breach of the terms of this Agreement. 

          

	(2) 	This indemnity survives
        the release of the escrow securities and the termination of this Agreement.
      



PART 10           NOTICES 


 10.1          Notice to Escrow
  Agent 

 Documents will be considered to have been delivered to the
  Escrow Agent on the next business day following the date of transmission, if
  delivered by fax, the date of delivery, if delivered by hand during normal business
  hours or by prepaid courier, or 5 business days after the date of mailing, if
  delivered by mail, to the following: 

 Pacific Corporate Trust Company 

  10th Floor - 625 Howe Street 

  Vancouver, B.C.

  V6C 3B8 

  Attention:      Corporate Trust Department 

  Facsimile:       604-689-8144 

 10.2          
  Notice to Issuer  

 Documents will be considered to have been delivered to the
  Issuer on the next business day following the date of transmission, if delivered
  by fax, the date of delivery, if delivered by hand or by prepaid courier, or
  5 business days after the date of mailing, if delivered by mail, to the following:


	 
	FORM 5D	ESCROW AGREEMENT	Page 18

	(as at August 2002)	 	 







 U.S. Geothermal Inc. (formerly U.S. Cobalt Inc.) 

  1509 Tyrell Lane, Suite B 

  Boise, Idaho 83706 

  Attention: Mr. Daniel Kunz 

  Facsimile: 208-424-1030 

 10.3          Deliveries to
  Securityholders 

 Documents will be considered to have been delivered to a Securityholder
  on the date of delivery, if delivered by hand or by prepaid courier, or 5 business
  days after the date of mailing, if delivered by mail, to the address on the
  Issuer’s share register. 

 Any share certificates or other evidence of a Securityholder’s
  escrow securities will be sent to the Securityholder’s address on the Issuer’s
  share register unless the Securityholder has advised the Escrow Agent in writing
  otherwise at least ten business days before the escrow securities are released
  from escrow. The Issuer will provide the Escrow Agent with each Securityholder’s
  address as listed on the Issuer’s share register. 

 10.4          Change of Address

	(1) 	The Escrow Agent may change its address for delivery
        by delivering notice of the change of address to the Issuer and to each
        Securityholder. 

          

	(2) 	The Issuer may change its address for delivery by
        delivering notice of the change of address to the Escrow Agent and to
        each Securityholder. 

          

	(3) 	A Securityholder may change that Securityholder’s
        address for delivery by delivering notice of the change of address to
        the Issuer and to the Escrow Agent. 



10.5          Postal Interruption


 A party to this Agreement will not mail a Document if the
  party is aware of an actual or impending disruption of postal service. 

 PART 11           GENERAL
   

 11.1          Interpretation
  – “holding securities”  

 Unless the context otherwise requires, all capitalized terms
  that are not otherwise defined in this Agreement, shall have the meanings as
  defined in Policy 1.1 - Interpretation or
  in Policy 5.4 - Escrow, Vendor Consideration and Resale Restrictions.


 When this Agreement refers to securities that a Securityholder
  “holds”, it means that the Securityholder has direct or indirect beneficial
  ownership of or control or direction over the securities. 

	 
	FORM 5D	ESCROW AGREEMENT	Page 19

	(as at August 2002)	 	 







 11.2           Enforcement
  by Third Parties  

 The Issuer enters this Agreement both on its own behalf and
  as trustee for the Exchange and the Securityholders of the Issuer, and this
  Agreement may be enforced by either the Exchange, or the Securityholders of
  the Issuer, or both. 

 11.3          Termination,
  Amendment, and Waiver of Agreement

	(1) 	Subject to subsection 11.3(3),
        this Agreement shall only terminate: 

          

	 	(a) 
	with respect to all the
        Parties: 

          

	 	 	(i) 
	as specifically provided in this Agreement; 

          

	 	 	(ii) 
	subject to subsection 11.3(2), upon the agreement
        of all Parties; or 

          

	 	 	(iii) 
	when the Securities of all Securityholders have been
        released from escrow pursuant to this Agreement; and 

          

	 	(b) 
	with respect to a Party:
        

          

	 	 	(i) 
	as specifically provided in this Agreement; or 

          

	 	 	(ii) 
	if the Party is a Securityholder, when all of the
        Securityholder’s Securities have been released from escrow pursuant
        to this Agreement. 

          

	(2) 	An agreement to terminate
        this Agreement pursuant to section 11.3(1)(a)(ii) shall not be effective
        unless and until the agreement to terminate 

          

	 	(a) 
	is evidenced by a memorandum
        in writing signed by all Parties; 

          

	 	(b) 
	has been consented to in
        writing by the Exchange; and 

          

	 	(c) 
	has been approved by a majority
        of securityholders of the Issuer who are not Securityholders. 

          

	(3) 	Notwithstanding any other
        provision in this Agreement, the obligations set forth in section 9.1
        shall survive the termination of this Agreement and the resignation or
        removal of the Escrow Agent. 

          

	(4) 	No amendment or waiver of
        this Agreement or any part of this Agreement shall be effective unless
        the amendment or waiver: 

          

	 	(a) 
	is evidenced by a memorandum
        in writing signed by all Parties; 

          

	 	(b) 
	has been approved in writing
        by the Exchange; and 



	 
	FORM 5D	ESCROW AGREEMENT	Page 20

	(as at August 2002)	 	 








	 	(c) 	has been approved by a majority of securityholders
        of the Issuer who are not Securityholders. 

          

	(5) 	No waiver of any of the
        provisions of this Agreement shall be deemed or shall constitute a waiver
        of any other provision (whether similar or not), nor shall any waiver
        constitute a continuing waiver, unless expressly provided. 



11.4          Severance of
  Illegal Provision 

 Any provision or part of a provision of this Agreement determined
  by a court of competent jurisdiction to be invalid, illegal or unenforceable
  shall be deemed stricken to the extent necessary to eliminate any invalidity,
  illegality or unenforceability, and the rest of the Agreement and all other
  provisions and parts thereof shall remain in full force and effect and be binding
  upon the parties hereto as though the said illegal and/or unenforceable provision
  or part thereof had never been included in this Agreement. 

 11.5          Further
  Assurances  

 The Parties will execute and deliver any further documents
  and perform any further acts reasonably requested by any of the Parties to this
  agreement which are necessary to carry out the intent of this Agreement. 

 11.6          Time


 Time is of the essence of this Agreement. 

 11.7          Consent
  of Exchange to Amendment  

 The Exchange must approve any amendment to this Agreement.


 11.8          Additional
  Escrow Requirements  

 A Canadian exchange may impose escrow terms or conditions
  in addition to those set out in this Agreement. 

 11.9          Governing
  Laws  

 The laws of the Province of British Columbia and the applicable
  laws of Canada will govern this Agreement. 

 11.10          Counterparts


 The Parties may execute this Agreement by fax and in counterparts,
  each of which will be considered an original and all of which will be one agreement.


 11.11           Singular and
  Plural 

	 
	FORM 5D	ESCROW AGREEMENT	Page 21

	(as at August 2002)	 	 











Wherever a singular expression is used in this Agreement, that expression is considered as including the plural or the body corporate where required by the context.


 11.12           Language 


 This Agreement has been drawn up in the English language at the request of
  all parties. Cet acte a été rédigé en anglais à
  la demande de toutes les parties. 

 11.13           Benefit and
  Binding Effect 


This Agreement will benefit and bind the Parties and their heirs, executors, administrators, successors and permitted assigns and all persons claiming through them as if they had been a Party to this Agreement.


 11.14           Entire Agreement
   


This is the entire agreement among the Parties concerning the subject matter set out in this Agreement and supersedes any and all prior understandings and agreements.


 11.15          Successor to
  Escrow Agent 


Any corporation with which the Escrow Agent may be amalgamated, merged or consolidated, or any corporation succeeding to the business of the Escrow Agent will be the successor of the Escrow Agent under this Agreement without any further act on its
part or on the part or any of the Parties, provided that the successor is recognized by the Exchange.



The Parties have executed and delivered this Agreement as of the date set out above.



PACIFIC CORPORATE TRUST COMPANY 


 ____________________________

  Authorized signatory 

 ____________________________

  Authorized signatory 


U.S. GEOTHERMAL INC. 


 ____________________________

  Authorized signatory 

 ____________________________

  Authorized signatory 

	 
	FORM 5D	ESCROW AGREEMENT	Page 22

	(as at August 2002)	 	 





If the Securityholder is an individual: 

	Signed, sealed and delivered by	)	 
	DANIEL KUNZ in the presence of:	)	 
	 	)	 
	  	)	 
	Name	)	 
	  	)	 
	Address	)	DANIEL KUNZ
	  	)	 
	 	)	 
	  	)	 
	Occupation	)	 


If the Securityholder is an individual: 

	Signed, sealed and delivered by	)	 
	DOUGLAS GLASPEY in the presence of:	)	 
	 	)	 
	  	)	 
	Name	)	 
	  	)	 
	Address	)	DOUGLAS GLASPEY
	  	)	 
	 	)	 
	  	)	 
	Occupation	)	 



If the Securityholder is an individual:


	Signed, sealed and delivered by	)	 
	PAUL LARKIN in the presence of:	)	 
	 	)	 
	  	)	 
	 	)	 
	Name	)	 
	  	)	 
	Address	)	PAUL LARKIN
	  	)	 
	 	)	 
	 	)	 
	  	)	 
	 	)	 
	Occupation	)	 


	 
	FORM 5D	ESCROW AGREEMENT	Page 23

	(as at August 2002)	 	 











If the Securityholder is an individual:


	Signed, sealed and delivered by	)	 
	RONALD BOURGEOIS in the presence of:	)	 
	 	)	 
	  	)	 
	Name	)	 
	  	)	 
	Address	)	RONALD BOURGEOIS
	  	)	 
	 	)	 
	  	)	 
	Occupation	)	 



If the Securityholder is an individual:


	Signed, sealed and delivered by	)	 
	JOHN WALKER in the presence of:	)	 
	 	)	 
	  	)	 
	Name	)	 
	  	)	 
	Address	)	JOHN WALKER
	  	)	 
	 	)	 
	  	)	 
	Occupation	)	 



VULCAN POWER COMPANY 


 _________________________________

  Authorized signatory 

 _________________________________

  Authorized signatory 

	 
	FORM 5D	ESCROW AGREEMENT	Page 24

	(as at August 2002)	 	 











Schedule “A” to Escrow Agreement 


 Securityholder 


Name: Daniel Kunz


 Signature: ____________________  

 Address for Notice:

	2997 Warm Springs Avenue
	Boise, Idaho
	83712  


 Securities:  

	Class and Type

      (i.e. Value Securities or Surplus 

      Securities 	Number	Certificate(s) (if applicable)
	common shares - value securities	2,365,880	 
	warrants – value securities	555,555	 


	 
	FORM 5D	ESCROW AGREEMENT	Page 25

	(as at August 2002)	 	 










 Securityholder 


Name: Douglas Glaspey


 Signature: ____________________  

 Address for Notice:

	3392 Maze Avenue
	Boise, Idaho
	83706  


 Securities: 

	Class and Type

      (i.e. Value Securities or Surplus 

      Securities 	Number	Certificate(s) (if applicable)
	common shares - value securities	1,014,649	 


	 
	FORM 5D	ESCROW AGREEMENT	Page 26

	(as at August 2002)	 	 










 Securityholder 


Name: Paul Larkin


 Signature: _______________ 

 Address for Notice: 

	2188 West 53rd Avenue
	Vancouver, B.C.
	V6P 1L7  


   Securities: 

	Class and Type

      (i.e. Value Securities or Surplus 

      Securities 	Number	Certificate(s) (if applicable)
	common shares - value securities	863,187	 


	 
	FORM 5D	ESCROW AGREEMENT	Page 27

	(as at August 2002)	 	 










 Securityholder 


Name: Ronald Bourgeois


 Signature: _______________ 

 Address for Notice:

	3630 West 34th AAvenue
	Vancouver, British Columbia
	V6N 2L1  


  Securities: 

	Class and Type

      (i.e. Value Securities or Surplus 

      Securities 	Number	Certificate(s) (if applicable)
	common shares - value securities	821,425	 


	 
	FORM 5D	ESCROW AGREEMENT	Page 28

	(as at August 2002)	 	 










 Securityholder 

 Name: John Walker 

 Signature: _______________

	81 Chartwell Road
	Oakville, Ontario
	L6J 323  


  Securities: 

	Class and Type

      (i.e. Value Securities or Surplus 

      Securities 	Number	Certificate(s) (if applicable)
	common shares - value securities	73,807	 


	 
	FORM 5D	ESCROW AGREEMENT	Page 29

	(as at August 2002)	 	 










 Securityholder 

 Name: Vulcan Power Company

	Signature: 	 
	 	(Authorized signatory) 
	 	 
	 	 
	 	(Authorized signatory) 


 Address for Notice: 

	 
	 
	  


 Securities: 

	Class and Type

      (i.e. Value Securities or Surplus 

      Securities 	Number	Certificate(s) (if applicable)
	common shares - value securities	1,755,156	 
	warrants - value securities	2,420,217	 


	 
	FORM 5D	ESCROW AGREEMENT	Page 30

	(as at August 2002)	 	 










 SCHEDULE B(1) – TIER 1 VALUE SECURITY ESCROW AGREEMENT
   

 RELEASE OF SECURITIES  

 Timed Release 

	Release Dates	Percentage of Total

      Escrowed Securities to be

      Released 	Total Number of Escrowed

      Securities to be Released
	[Insert date of Exchange

      Bulletin]	1/4 of your escrow securities	 
	[Insert date 6 months

      following Exchange

      Bulletin] 	1/3 of your remaining

      escrow securities 	 
	[Insert date 12 months

      following Exchange

      Bulletin] 	1/2 of your remaining

      escrow securities 	 
	[Insert date 18 months

      following Exchange

      Bulletin] 	all of your remaining escrow

      securities 	 
	TOTAL	100%	 




	*	In the simplest case where there are no changes to
        the escrow securities initially deposited and no additional escrow securities,
        then the release schedule outlined above results in the escrow securities
        being released in equal tranches of 25%. 



	 
	FORM 5D	ESCROW AGREEMENT	Page 31

	(as at August 2002)	 	 










 SCHEDULE B(2) – TIER 2 VALUE SECURITY ESCROW AGREEMENT
   

 RELEASE OF SECURITIES  

 Timed Release 

	Release Dates	Percentage of Total Escrowed

      Securities to be Released 	Total Number of Escrowed

      Securities to be Released 
	December 19, 2003	1/10 of your escrowed

      securities 	689,410 shares

      297,577 warrants 
	June 19, 2004	1/6 of your remaining escrow

      securities 	1,034,116 shares

      446,365 warrants 
	December 19, 2004	1/5 of your remaining escrow

      securities 	1,034,116 shares

      446,365 warrants 
	June 19, 2005	1/4 of your remaining escrow

      securities 	1,034,116 shares

      446,365 warrants 
	December 19, 2005	1/3 of your remaining escrow

      securities 	1,034,116 shares

      446,365 warrants 
	June 19, 2006	1/2 of your remaining escrow

      securities 	1,034,116 shares

      446,365 warrants 
	December 19, 2006	all of your remaining escrow

      securities 	1,034,114 shares

      446,370 warrants 
	TOTAL	100%	6,894,104 shares

      2,975,772 warrants 




	*	In the simplest case where there are no changes to
        the escrow securities initially deposited and no additional escrow securities,
        the release schedule outlined above results in the escrow securities being
        released in equal tranches of 15% after completion of the release on the
        date of the Exchange Bulletin. 



	 
	FORM 5D	ESCROW AGREEMENT	Page 32

	(as at August 2002)	 	 










 SCHEDULE B(3) – TIER 1 SURPLUS SECURITY ESCROW AGREEMENT
   


RELEASE OF SECURITIES 


 Timed Release 

	Release Dates	Percentage of Total Escrowed

      Securities to be Released 	Total Number of Escrowed

      Securities to be Released 
	[Insert date of Exchange

      Bulletin] 	1/10 of your escrow securities	 
	[Insert date 6 months

      following Exchange

      Bulletin] 	1/6 of your remaining escrow

      securities 	 
	[Insert date 12 months

      following Exchange

      Bulletin] 	1/5 of your remaining escrow

      securities 	 
	[Insert date 18 months

      following Exchange 

      Bulletin] 	1/4 of your remaining escrow

      securities 	 
	[Insert date 24 months

      following Exchange 

      Bulletin] 	1/3 of your remaining escrow

      securities 	 
	[Insert date 30 months

      following Exchange 

      Bulletin] 	1/2 of your remaining escrow

      securities 	 
	[Insert date 36 months

      following Exchange 

      Bulletin] 	all of your remaining escrow

      securities 	 
	TOTAL	100%	 




	*	In the simplest case where there are no changes to
        the escrow securities initially deposited and no additional escrow securities,
        the release schedule outlined above results in the escrow securities being
        released in equal tranches of 15% after completion of the release on the
        date of the Exchange Bulletin. 



	 
	FORM 5D	ESCROW AGREEMENT	Page 33

	(as at August 2002)	 	 










 SCHEDULE B(4) – TIER 2 SURPLUS SECURITY ESCROW AGREEMENT
   


RELEASE OF SECURITIES 


 Timed Release 

	Release Dates	Percentage of Total

      Escrowed Securities to be

      Released 	Total Number of

      Escrowed Securities to be

      Released 
	[Insert date of Exchange

      Bulletin] 	no release	 
	[Insert date 6 months following

      Exchange Bulletin] 	1/20 of your escrow

      securities 	 
	[Insert date 12 months

      following Exchange Bulletin] 	1/19 of your remaining

      escrow securities 	 
	[Insert date 18 months

      following Exchange Bulletin] 	1/18 of your remaining

      escrow securities 	 
	[Insert date 24 months

      following Exchange Bulletin] 	1/17 of your remaining

      escrow securities 	 
	[Insert date 30 months

      following Exchange Bulletin] 	1/8 of your remaining

      escrow securities 	 
	[Insert date 36 months

      following Exchange Bulletin] 	1/7 of your remaining

      escrow securities 	 
	[Insert date 42 months

      following Exchange Bulletin] 	1/6 of your remaining

      escrow securities 	 
	[Insert date 48 months

      following Exchange Bulletin] 	1/5 of your remaining

      escrow securities 	 
	[Insert date 54 months

      following Exchange Bulletin] 	1/4 of your remaining

      escrow securities 	 
	[Insert date 60 months

      following Exchange Bulletin] 	1/3 of your remaining

      escrow securities 	 
	[Insert date 66 months

      following Exchange Bulletin] 	1/2 of your remaining

      escrow securities 	 
	[Insert date 72 months

      following Exchange Bulletin] 	all of your remaining escrow

      securities 	 
	TOTAL	100%	 


	 
	FORM 5D	ESCROW AGREEMENT	Page 34

	(as at August 2002)