Exhibit 10.4


                             POWER TECHNOLOGY, INC.
                            PLACEMENT AGENT AGREEMENT

                                                       Dated as of: May 10, 2005

Newbridge Securities Corporation
1451 Cypress Creek Road, Suite 204
Fort Lauderdale, Florida 33309


Ladies and Gentlemen:

         The  undersigned,  Power  Technology,  Inc., a Nevada  corporation (the
"Company"),  hereby agrees with Newbridge Securities Corporation (the "Placement
Agent") and Cornell Capital  Partners,  LP, a Delaware Limited  Partnership (the
"Investor"), as follows:

         1. Offering.  The Company hereby engages the Placement  Agent to act as
its exclusive placement agent in connection with the Standby Equity Distribution
Agreement of even date herewith (the "Standby Equity  Distribution  Agreement"),
pursuant to which the Company shall issue and sell to the Investor, from time to
time, and the Investor  shall  purchase from the Company (the  "Offering") up to
Five Million Dollars ($5,000,000) of the Company's common stock (the "Commitment
Amount"),  par value $0.001 per share (the "Common  Stock"),  at price per share
equal to the  Purchase  Price,  as that term is  defined in the  Standby  Equity
Distribution Agreement.  The Placement Agent services shall consist of reviewing
the terms of the Standby Equity Distribution  Agreement and advising the Company
with respect to those terms.

         All  capitalized  terms used herein and not  otherwise  defined  herein
shall  have  the  same  meaning  ascribed  to  them  as in  the  Standby  Equity
Distribution Agreement. The Investor will be granted certain registration rights
with  respect  to the Common  Stock as more fully set forth in the  Registration
Rights Agreement between the Company and the Investor dated the date hereof (the
"Registration Rights Agreement").  The documents to be executed and delivered in
connection  with the  Offering,  including,  but not limited,  to the  Company's
latest  Quarterly  Report  on Form  10-QSB  as  filed  with  the  United  States
Securities  and  Exchange  Commission,   this  Agreement,   the  Standby  Equity
Distribution  Agreement,  the  Registration  Rights  Agreement,  and the  Escrow
Agreement  dated the date  hereof  (the  "Escrow  Agreement"),  are  referred to
sometimes  hereinafter  collectively as the "Offering  Materials." The Company's
Common Stock  purchased by the Investor  hereunder or to be issued in connection
with the conversion of any  debentures are sometimes  referred to hereinafter as
the  "Securities."  The  Placement  Agent  shall  not be  obligated  to sell any
Securities.

         2. Compensation.

             A. The Company shall issue to the Placement Agent 442,477 shares of
Common Stock (the  "Placement  Agent's  Shares").  The Placement  Agent shall be
entitled  to  "piggy-back"  registration  rights with  respect to the  Placement


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Agent's  Shares,  which shall be triggered  upon  registration  of any shares of
Common Stock by the Company pursuant to the Registration  Rights Agreement dated
the date hereof.

         3. Representations, Warranties and Covenants of the Placement Agent.

             A. The  Placement  Agent  represents,  warrants  and  covenants  as
follows:

                  (i) The Placement  Agent has the necessary power to enter into
this Agreement and to consummate the transactions contemplated hereby.

                  (ii) The execution and delivery by the Placement Agent of this
Agreement and the consummation of the transactions  contemplated herein will not
result in any  violation  of, or be in conflict  with,  or  constitute a default
under, any agreement or instrument to which the Placement Agent is a party or by
which the Placement Agent or its properties are bound, or any judgment,  decree,
order or, to the Placement Agent's  knowledge,  any statute,  rule or regulation
applicable to the Placement Agent. This Agreement when executed and delivered by
the Placement Agent, will constitute the legal, valid and binding obligations of
the Placement  Agent,  enforceable in accordance  with their  respective  terms,
except  to the  extent  that (a) the  enforceability  hereof or  thereof  may be
limited by bankruptcy,  insolvency,  reorganization,  moratorium or similar laws
from time to time in effect and affecting the rights of creditors generally, (b)
the enforceability hereof or thereof is subject to general principles of equity,
or (c) the  indemnification  provisions  hereof or thereof  may be held to be in
violation of public policy.

                  (iii)  Upon  receipt  and  execution  of this  Agreement,  the
Placement Agent will promptly forward copies of this Agreement to the Company or
its counsel and the Investor or its counsel.

                  (iv)  The  Placement  Agent  will not  intentionally  take any
action  that it  reasonably  believes  would  cause the  Offering to violate the
provisions of the Securities Act of 1933, as amended (the "Securities Act"), the
Securities  Exchange Act of 1934 (the "Exchange  Act"), the respective rules and
regulations  promulgated  thereunder (the "Rules and Regulations") or applicable
"Blue Sky" laws of any state or jurisdiction.

                  (v)  The   Placement   Agent  is  a  member  of  the  National
Association of Securities  Dealers,  Inc., and is a broker-dealer  registered as
such under the Exchange Act and under the securities laws of the states in which
the  Securities  will be  offered  or  sold by the  Placement  Agent  unless  an
exemption for such state  registration is available to the Placement  Agent. The
Placement  Agent is in  material  compliance  with  the  rules  and  regulations
applicable to the  Placement  Agent  generally  and  applicable to the Placement
Agent's participation in the Offering.


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         4. Representations and Warranties of the Company.

             A. The Company represents and warrants as follows:

                  (i) The  execution,  delivery and  performance of each of this
Agreement,  the Standby Equity Distribution Agreement, the Escrow Agreement, and
the  Registration  Rights  Agreement  has  been  or will  be  duly  and  validly
authorized by the Company and is, or with respect to this Agreement, the Standby
Equity Distribution Agreement, the Escrow Agreement, and the Registration Rights
Agreement, will be a valid and binding agreement of the Company,  enforceable in
accordance  with  its  respective  terms,  except  to the  extent  that  (a) the
enforceability  hereof or  thereof  may be limited  by  bankruptcy,  insolvency,
reorganization,  moratorium  or  similar  laws from  time to time in effect  and
affecting the rights of creditors  generally,  (b) the enforceability  hereof or
thereof is subject to general  principles  of equity or (c) the  indemnification
provisions  hereof or thereof may be held to be in violation  of public  policy.
The Securities to be issued  pursuant to the  transactions  contemplated by this
Agreement  and  the  Standby  Equity  Distribution   Agreement  have  been  duly
authorized and, when issued and paid for in accordance with this Agreement,  the
Standby   Equity   Distribution   Agreement  and  the   certificates/instruments
representing  such  Securities,  will be valid and  binding  obligations  of the
Company,  enforceable in accordance with their respective  terms,  except to the
extent  that  (1) the  enforceability  thereof  may be  limited  by  bankruptcy,
insolvency,  reorganization,  moratorium  or  similar  laws from time to time in
effect  and   affecting  the  rights  of  creditors   generally,   and  (2)  the
enforceability thereof is subject to general principles of equity. All corporate
action  required  to be taken for the  authorization,  issuance  and sale of the
Securities has been duly and validly taken by the Company.

                  (ii) The Company has a duly authorized, issued and outstanding
capitalization  as set  forth  herein  and in the  Standby  Equity  Distribution
Agreement.  The Company is not a party to or bound by any instrument,  agreement
or other  arrangement  providing  for it to issue  any  capital  stock,  rights,
warrants, options or other securities, except for this Agreement, the agreements
described herein and as described in the Standby Equity  Distribution  Agreement
and the agreements described therein.  All issued and outstanding  securities of
the Company, have been duly authorized and validly issued and are fully paid and
non-assessable;  the holders  thereof have no rights of rescission or preemptive
rights with respect thereto and are not subject to personal  liability solely by
reason of being security  holders;  and none of such  securities  were issued in
violation  of the  preemptive  rights  of any  holders  of any  security  of the
Company.

                  (iii) The Common  Stock to be issued in  accordance  with this
Agreement and the Standby Equity Distribution Agreement has been duly authorized
and, when issued and paid for in accordance  with this Agreement and the Standby
Equity Distribution Agreement,  the  certificates/instruments  representing such
Common Stock will be validly issued, fully-paid and non-assessable;  the holders
thereof will not be subject to personal liability solely by reason of being such
holders;  such  Securities  are not and will not be  subject  to the  preemptive
rights of any holder of any security of the Company.

                  (iv) The  Company has good and  marketable  title to, or valid
and enforceable  leasehold  estates in, all items of real and personal  property
necessary to conduct its business  (including,  without limitation,  any real or
personal property stated in the Offering  Materials to be owned or leased by the


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Company), free and clear of all liens, encumbrances,  claims, security interests
and defects of any material nature whatsoever, other than those set forth in the
Offering Materials and liens for taxes not yet due and payable.

                  (v) There is no litigation or governmental  proceeding pending
or, to the best of the Company's knowledge, threatened against, or involving the
properties  or  business  of the  Company,  except as set forth in the  Offering
Materials.

                  (vi)  The  Company  has been  duly  organized  and is  validly
existing  as a  corporation  in good  standing  under  the laws of the  State of
Nevada. Except as set forth in the Offering Materials,  the Company does not own
or control,  directly  or  indirectly,  an  interest  in any other  corporation,
partnership,  trust, joint venture or other business entity. The Company is duly
qualified  or licensed  and in good  standing as a foreign  corporation  in each
jurisdiction   in  which  the   character  of  its   operations   requires  such
qualification or licensing and where failure to so qualify would have a material
adverse effect on the Company. The Company has all requisite corporate power and
authority,  and all material and necessary  authorizations,  approvals,  orders,
licenses,  certificates  and  permits  of and from all  governmental  regulatory
officials  and bodies  (domestic  and  foreign) to conduct its  businesses  (and
proposed  business) as described in the Offering  Materials.  Any disclosures in
the Offering  Materials  concerning the effects of foreign,  federal,  state and
local  regulation  on the  Company's  businesses  as currently  conducted and as
contemplated  are correct in all  material  respects  and do not omit to state a
material fact.  The Company has all corporate  power and authority to enter into
this Agreement,  the Standby Equity  Distribution  Agreement,  the  Registration
Rights  Agreement,  and the Escrow  Agreement,  to carry out the  provisions and
conditions hereof and thereof, and all consents,  authorizations,  approvals and
orders  required in connection  herewith and therewith  have been  obtained.  No
consent,  authorization  or order of, and no filing with, any court,  government
agency  or  other  body is  required  by the  Company  for the  issuance  of the
Securities  or  execution  and  delivery of the  Offering  Materials  except for
applicable federal and state securities laws. The Company,  since its inception,
has not incurred any liability  arising under or as a result of the  application
of any of the  provisions of the  Securities  Act, the Exchange Act or the Rules
and Regulations.

                  (vii)  There  has  been  no  material  adverse  change  in the
condition or prospects of the Company,  financial or otherwise,  from the latest
dates as of which such  condition or prospects,  respectively,  are set forth in
the Offering Materials,  and the outstanding debt, the property and the business
of the Company  conform in all  material  respects to the  descriptions  thereof
contained in the Offering Materials.

                  (viii)  Except as set  forth in the  Offering  Materials,  the
Company is not in breach of, or in default  under,  any term or provision of any
material indenture, mortgage, deed of trust, lease, note, loan or Standby Equity
Distribution  Agreement or any other material agreement or instrument evidencing
an obligation for borrowed money, or any other material  agreement or instrument
to which it is a party or by which it or any of its  properties  may be bound or
affected.  The Company is not in  violation  of any  provision of its charter or
by-laws or in violation of any franchise,  license, permit, judgment,  decree or
order, or in violation of any material statute, rule or regulation.  Neither the
execution  and delivery of the Offering  Materials  nor the issuance and sale or
delivery of the  Securities,  nor the  consummation  of any of the  transactions


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contemplated  in the Offering  Materials nor the  compliance by the Company with
the terms and provisions hereof or thereof, has conflicted with or will conflict
with,  or has  resulted  in or will  result in a breach of, any of the terms and
provisions  of, or has  constituted or will  constitute a default under,  or has
resulted in or will result in the creation or imposition of any lien,  charge or
encumbrance  upon any property or assets of the Company or pursuant to the terms
of any indenture,  mortgage, deed of trust, note, loan or any other agreement or
instrument  evidencing an obligation for borrowed  money, or any other agreement
or  instrument to which the Company may be bound or to which any of the property
or assets of the Company is subject except (a) where such default,  lien, charge
or encumbrance  would not have a material  adverse effect on the Company and (b)
as  described  in the  Offering  Materials;  nor will such action  result in any
violation  of the  provisions  of the  charter or the by-laws of the Company or,
assuming  the  due  performance  by  the  Placement  Agent  of  its  obligations
hereunder,  any  material  statute or any  material  order,  rule or  regulation
applicable  to the  Company of any court or of any  foreign,  federal,  state or
other regulatory authority or other government body having jurisdiction over the
Company.

                  (ix) Subsequent to the dates as of which  information is given
in  the  Offering  Materials,  and  except  as may  otherwise  be  indicated  or
contemplated  herein or  therein  and the  securities  offered  pursuant  to the
Standby  Equity  Distribution  Agreement and the Securities  Purchase  Agreement
between the  Investor and the Company  dated as of August 27, 2004,  the Company
has not (a) issued any  securities  or incurred  any  liability  or  obligation,
direct or contingent,  for borrowed  money,  or (b) entered into any transaction
other than in the  ordinary  course of  business,  or (c)  declared  or paid any
dividend or made any other  distribution  on or in respect of its capital stock.
Except as described in the Offering  Materials,  the Company has no  outstanding
obligations to any officer or director of the Company.

                  (x)  There  are no  claims  for  services  in the  nature of a
finder's or origination  fee with respect to the sale of the Common Stock or any
other  arrangements,  agreements or understandings that may affect the Placement
Agent's  compensation,  as determined by the National  Association of Securities
Dealers, Inc.

                  (xi)  Except as set forth in the SEC  Documents,  the  Company
owns or  possesses,  free and  clear of all  liens or  encumbrances  and  rights
thereto or therein by third parties,  the requisite  licenses or other rights to
use all  trademarks,  service marks,  copyrights,  service  names,  trade names,
patents,  patent  applications  and  licenses  necessary to conduct its business
(including,  without  limitation,  any such licenses or rights  described in the
Offering  Materials as being owned or possessed by the Company)  and,  except as
set forth in the Offering  Materials,  there is no claim or action by any person
pertaining  to, or  proceeding,  pending or  threatened,  which  challenges  the
exclusive  rights of the Company with respect to any trademarks,  service marks,
copyrights,  service  names,  trade  names,  patents,  patent  applications  and
licenses used in the conduct of the  Company's  businesses  (including,  without
limitation,  any such licenses or rights described in the Offering  Materials as
being owned or possessed  by the Company)  except any claim or action that would
not have a  material  adverse  effect  on the  Company;  the  Company's  current
products,  services or  processes  do not  infringe or will not  infringe on the
patents currently held by any third party.


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                  (xii)  Except as  described  in the  Offering  Materials,  the
Company  is not  under  any  obligation  to pay  royalties  or fees of any  kind
whatsoever  to any third party with respect to any  trademarks,  service  marks,
copyrights,  service names, trade names, patents, patent applications,  licenses
or technology it has developed, uses, employs or intends to use or employ, other
than to their respective licensors.

                  (xiii) Subject to the  performance  by the Placement  Agent of
its  obligations  hereunder the offer and sale of the Securities  complies,  and
will continue to comply,  in all material respects with the requirements of Rule
506 of Regulation D promulgated  by the SEC pursuant to the  Securities  Act and
any other applicable  federal and state laws,  rules,  regulations and executive
orders.  Neither the Offering  Materials nor any amendment or supplement thereto
nor any documents  prepared by the Company in connection  with the Offering will
contain any untrue  statement  of a material  fact or omit to state any material
fact required to be stated therein or necessary to make the statements  therein,
in light of the  circumstances  under which they were made, not misleading.  All
statements of material  facts in the Offering  Materials are true and correct as
of the date of the Offering Materials.

                  (xiv) All  material  taxes which are due and payable  from the
Company  have been  paid in full or  adequate  provision  has been made for such
taxes on the books of the Company, except for those taxes disputed in good faith
by the Company

                  (xv) None of the Company nor any of its  officers,  directors,
employees or agents, nor any other person acting on behalf of the Company,  has,
directly  or  indirectly,  given or agreed to give any  money,  gift or  similar
benefit (other than legal price  concessions to customers in the ordinary course
of  business)  to any  customer,  supplier,  employee  or agent of a customer or
supplier,  or official or employee of any governmental agency or instrumentality
of any government  (domestic or foreign) or any political party or candidate for
office  (domestic  or foreign) or other person who is or may be in a position to
help or hinder the business of the Company (or assist it in connection  with any
actual or  proposed  transaction)  which (A) might  subject  the  Company to any
damage  or  penalty  in  any  civil,  criminal  or  governmental  litigation  or
proceeding, or (B) if not given in the past, might have had a materially adverse
effect on the assets,  business or operations of the Company as reflected in any
of the financial statements  contained in the Offering Materials,  or (C) if not
continued in the future, might adversely affect the assets, business, operations
or prospects of the Company in the future.

         5. Representations, Warranties and Covenants of the Investor.

             A. The Investor represents, warrants and covenants as follows:

                  (i) The  Investor has the  necessary  power to enter into this
Agreement and to consummate the transactions contemplated hereby.

                  (ii)  The  execution  and  delivery  by the  Investor  of this
Agreement and the consummation of the transactions  contemplated herein will not
result in any  violation  of, or be in conflict  with,  or  constitute a default
under,  any agreement or instrument to which the Investor is a party or by which
the Investor or its properties are bound, or any judgment,  decree, order or, to
the  Investor's  knowledge,  any statute,  rule or regulation  applicable to the
Investor.  This  Agreement  when executed and  delivered by the  Investor,  will


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constitute the legal, valid and binding obligations of the Investor, enforceable
in accordance  with their  respective  terms,  except to the extent that (a) the
enforceability  hereof or  thereof  may be limited  by  bankruptcy,  insolvency,
reorganization,  moratorium  or  similar  laws from  time to time in effect  and
affecting the rights of creditors  generally,  (b) the enforceability  hereof or
thereof is subject to general  principles of equity, or (c) the  indemnification
provisions hereof or thereof may be held to be in violation of public policy.

                  (iii) The Investor will promptly forward copies of any and all
due diligence questionnaires compiled by the Investor to the Placement Agent.

                  (iv) The Investor is an Accredited  Investor (as defined under
the Securities Act).

                  (v)  The  Investor  has  such   knowledge  and  experience  in
financial  and business  matters as to be capable of  evaluating  the merits and
risks of the prospective investment.

                  (vi)  The  Investor  has  been  given  the  opportunity  for a
reasonable  time  prior to the date  hereof to ask  questions  of,  and  receive
answers  from,  the  Company  or its  representatives  concerning  the terms and
conditions of the Offering, and other matters pertaining to this investment, and
has been given the opportunity for a reasonable time prior to the date hereof to
obtain such  additional  information in connection with the Company in order for
the Investor to evaluate the merits and risks of purchase of the Securities,  to
the extent the  Company  possesses  such  information  or can acquire it without
unreasonable  effort or expense.  The  Investor is not relying on the  Placement
Agent or any of its affiliates  with respect to the accuracy or  completeness of
the  Offering  Materials  or for any  economic  considerations  involved in this
investment.

         6. Certain Covenants and Agreements of the Company.

         The Company covenants and agrees at its expense and without any expense
to the Placement Agent as follows:

             A. To advise the  Placement  Agent and the Investor of any material
adverse change in the Company's financial condition, prospects or business or of
any  development  materially  affecting  the  Company  or  rendering  untrue  or
misleading  any material  statement in the Offering  Materials  occurring at any
time as soon as the Company is either informed or becomes aware thereof.

             B. To use its commercially  reasonable  efforts to cause the Common
Stock issuable in connection with the Standby Equity  Distribution  Agreement to
be qualified or registered for sale on terms consistent with those stated in the
Registration   Rights   Agreement  and  under  the   securities   laws  of  such
jurisdictions as the Placement Agent and the Investor shall reasonably  request.
Qualification,  registration and exemption charges and fees shall be at the sole
cost and expense of the Company.


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             C. Upon  written  request,  to provide and  continue to provide the
Placement  Agent and the Investor copies of all quarterly  financial  statements
and audited annual financial statements prepared by or on behalf of the Company,
other reports prepared by or on behalf of the Company for public  disclosure and
all documents delivered to the Company's stockholders.

             D. To deliver, during the registration period of the Standby Equity
Distribution  Agreement,  to the Investor upon the  Investor's  request,  within
forty five (45) days, a statement of its income for each such quarterly  period,
and its balance sheet and a statement of changes in  stockholders'  equity as of
the end of such quarterly  period,  all in reasonable  detail,  certified by its
principal  financial or accounting  officer;  (ii) within ninety (90) days after
the close of each fiscal year,  its balance sheet as of the close of such fiscal
year,   together  with  a  statement  of  income,  a  statement  of  changes  in
stockholders'  equity and a statement  of cash flow for such fiscal  year,  such
balance sheet, statement of income, statement of changes in stockholders' equity
and statement of cash flow to be in reasonable  detail and accompanied by a copy
of the  certificate  or  report  thereon  of  independent  auditors  if  audited
financial  statements are prepared;  and (iii) a copy of all documents,  reports
and information  furnished to its  stockholders at the time that such documents,
reports and information are furnished to its stockholders.

             E. To comply with the terms of the Offering Materials.

             F. To ensure that any transactions between or among the Company, or
any of its officers,  directors and affiliates be on terms and  conditions  that
are no less favorable to the Company,  than the terms and conditions  that would
be available in an "arm's length" transaction with an independent third party.

         7. Indemnification and Limitation of Liability.

             A. The Company  hereby  agrees that it will  indemnify and hold the
Placement   Agent  and  each  officer,   director,   shareholder,   employee  or
representative of the Placement Agent and each person controlling, controlled by
or under common  control with the Placement  Agent within the meaning of Section
15 of the  Securities  Act or Section 20 of the  Exchange Act or the SEC's Rules
and Regulations  promulgated thereunder (the "Rules and Regulations"),  harmless
from and against any and all loss,  claim,  damage,  liability,  cost or expense
whatsoever (including, but not limited to, any and all reasonable legal fees and
other  expenses and  disbursements  incurred in connection  with  investigating,
preparing to defend or defending any action,  suit or proceeding,  including any
inquiry or investigation, commenced or threatened, or any claim whatsoever or in
appearing  or  preparing  for  appearance  as a witness in any  action,  suit or
proceeding,  including any inquiry, investigation or pretrial proceeding such as
a deposition)  to which the Placement  Agent or such  indemnified  person of the
Placement  Agent may become subject under the Securities  Act, the Exchange Act,
the Rules and  Regulations,  or any other  federal  or state law or  regulation,
common law or otherwise,  arising out of or based upon (i) any untrue  statement
or alleged  untrue  statement of a material  fact  contained in (a) Section 4 of
this  Agreement,  (b) the Offering  Materials  (except those written  statements
relating to the  Placement  Agent  given by the  Placement  Agent for  inclusion
therein),  (c) any  application  or  other  document  or  written  communication
executed  by the  Company or based upon  written  information  furnished  by the
Company filed in any jurisdiction in order to qualify the Common Stock under the
securities laws thereof, or any state securities  commission or agency; (ii) the
omission or alleged omission from documents described in clauses (a), (b) or (c)


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above of a material fact required to be stated  therein or necessary to make the
statements  therein not misleading;  or (iii) the breach of any  representation,
warranty,  covenant  or  agreement  made by the Company in this  Agreement.  The
Company further agrees that upon demand by an indemnified person, at any time or
from time to time, it will promptly  reimburse such  indemnified  person for any
loss, claim, damage,  liability, cost or expense actually and reasonably paid by
the  indemnified  person as to which the  Company  has  indemnified  such person
pursuant  hereto.  Notwithstanding  the foregoing  provisions of this  Paragraph
7(A),  any such  payment or  reimbursement  by the Company of fees,  expenses or
disbursements  incurred by an  indemnified  person in any  proceeding in which a
final  judgment by a court of competent  jurisdiction  (after all appeals or the
expiration  of time to appeal) is entered  against the  Placement  Agent or such
indemnified  person based upon specific finding of fact that the Placement Agent
or such  indemnified  person's gross  negligence or willful  misfeasance will be
promptly repaid to the Company.

             B. The  Placement  Agent hereby  agrees that it will  indemnify and
hold  the  Company  and  each  officer,  director,   shareholder,   employee  or
representative  of the Company,  and each person  controlling,  controlled by or
under common  control  with the Company  within the meaning of Section 15 of the
Securities  Act or Section 20 of the Exchange Act or the Rules and  Regulations,
harmless from and against any and all loss, claim,  damage,  liability,  cost or
expense whatsoever (including,  but not limited to, any and all reasonable legal
fees  and  other  expenses  and   disbursements   incurred  in  connection  with
investigating,  preparing to defend or defending any action, suit or proceeding,
including any inquiry or  investigation,  commenced or threatened,  or any claim
whatsoever  or in  appearing  or preparing  for  appearance  as a witness in any
action,  suit or proceeding,  including any inquiry,  investigation  or pretrial
proceeding such as a deposition) to which the Company or such indemnified person
of the Company may become  subject under the  Securities  Act, the Exchange Act,
the Rules and  Regulations,  or any other  federal  or state law or  regulation,
common law or otherwise, arising out of or based upon (i) the material breach of
any representation,  warranty, covenant or agreement made by the Placement Agent
in this Agreement,  or (ii) any false or misleading  information provided to the
Company  in  writing  by  one  of  the  Placement  Agent's  indemnified  persons
specifically for inclusion in the Offering Materials.


                                       9
<PAGE>

             C. The Investor  hereby agrees that it will  indemnify and hold the
Placement   Agent  and  each  officer,   director,   shareholder,   employee  or
representative of the Placement Agent, and each person  controlling,  controlled
by or under  common  control  with the  Placement  Agent  within the  meaning of
Section 15 of the  Securities Act or Section 20 of the Exchange Act or the Rules
and  Regulations,  harmless  from and against any and all loss,  claim,  damage,
liability,  cost or expense whatsoever  (including,  but not limited to, any and
all  reasonable  legal fees and other  expenses  and  disbursements  incurred in
connection with investigating, preparing to defend or defending any action, suit
or proceeding, including any inquiry or investigation,  commenced or threatened,
or any claim whatsoever or in appearing or preparing for appearance as a witness
in any action,  suit or  proceeding,  including  any inquiry,  investigation  or
pretrial  proceeding  such as a deposition) to which the Placement Agent or such
indemnified  person  of  the  Placement  Agent  may  become  subject  under  the
Securities  Act,  the  Exchange  Act,  the Rules and  Regulations,  or any other
federal or state law or regulation,  common law or otherwise,  arising out of or
based  upon (i) the  conduct  of the  Investor  or its  officers,  employees  or
representatives  in its  acting  as the  Investor  for the  Offering,  (ii)  the
material breach of any representation,  warranty,  covenant or agreement made by
the  Investor  in the  Offering  Materials,  or (iii)  any  false or  misleading
information provided to the Placement Agent by one of the Investor's indemnified
persons.

             D. The  Placement  Agent hereby  agrees that it will  indemnify and
hold  the  Investor  and  each  officer,  director,  shareholder,   employee  or
representative of the Investor,  and each person  controlling,  controlled by or
under common  control with the Investor  within the meaning of Section 15 of the
Securities  Act or Section 20 of the Exchange Act or the Rules and  Regulations,
harmless from and against any and all loss, claim,  damage,  liability,  cost or
expense whatsoever (including,  but not limited to, any and all reasonable legal
fees  and  other  expenses  and   disbursements   incurred  in  connection  with
investigating,  preparing to defend or defending any action, suit or proceeding,
including any inquiry or  investigation,  commenced or threatened,  or any claim
whatsoever  or in  appearing  or preparing  for  appearance  as a witness in any
action,  suit or proceeding,  including any inquiry,  investigation  or pretrial
proceeding  such as a  deposition)  to which the  Investor  or such  indemnified
person of the Investor may become subject under the Securities Act, the Exchange
Act, the Rules and Regulations, or any other federal or state law or regulation,
common law or otherwise, arising out of or based upon the material breach of any
representation,  warranty,  covenant or agreement made by the Placement Agent in
this Agreement.

             E.  Promptly  after  receipt by an  indemnified  party of notice of
commencement  of any action covered by Section 7(A),  (B), (C) or (D), the party
to be indemnified shall,  within five (5) business days, notify the indemnifying
party of the commencement  thereof; the omission by one (1) indemnified party to
so notify the indemnifying party shall not relieve the indemnifying party of its
obligation to indemnify any other  indemnified  party that has given such notice
and shall not relieve the  indemnifying  party of any liability  outside of this
indemnification  if not  materially  prejudiced  thereby.  In the event that any
action is brought against the indemnified  party, the indemnifying party will be
entitled to participate  therein and, to the extent it may desire, to assume and
control  the  defense  thereof  with  counsel  chosen by it which is  reasonably
acceptable to the indemnified party. After notice from the indemnifying party to
such  indemnified  party of its election to so assume the defense  thereof,  the
indemnifying  party  will not be liable to such  indemnified  party  under  such
Section  7(A),  (B),  (C), or (D) for any legal or other  expenses  subsequently
incurred by such indemnified  party in connection with the defense thereof,  but
the  indemnified  party may, at its own expense,  participate in such defense by
counsel  chosen by it,  without,  however,  impairing the  indemnifying  party's


                                       10
<PAGE>

control  of  the  defense.   Subject  to  the  proviso  of  this   sentence  and
notwithstanding  any other  statement  to the  contrary  contained  herein,  the
indemnified  party or  parties  shall  have the right to choose its or their own
counsel  and  control  the  defense  of any  action,  all at the  expense of the
indemnifying  party  if (i) the  employment  of such  counsel  shall  have  been
authorized in writing by the  indemnifying  party in connection with the defense
of  such  action  at  the  expense  of  the  indemnifying  party,  or  (ii)  the
indemnifying  party shall not have employed counsel  reasonably  satisfactory to
such  indemnified  party to have charge of the  defense of such action  within a
reasonable  time  after  notice of  commencement  of the  action,  or (iii) such
indemnified  party or parties shall have reasonably  concluded that there may be
defenses available to it or them which are different from or additional to those
available  to one  or  all  of the  indemnifying  parties  (in  which  case  the
indemnifying  parties  shall not have the right to direct  the  defense  of such
action on behalf of the  indemnified  party or parties),  in any of which events
such  fees  and  expenses  of one  additional  counsel  shall  be  borne  by the
indemnifying party; provided, however, that the indemnifying party shall not, in
connection with any one action or separate but substantially  similar or related
actions in the same jurisdiction  arising out of the same general allegations or
circumstance,  be liable for the  reasonable  fees and expenses of more than one
separate  firm of attorneys  at any time for all such  indemnified  parties.  No
settlement of any action or  proceeding  against an  indemnified  party shall be
made without the consent of the indemnifying party.

             F. In order to  provide  for just  and  equitable  contribution  in
circumstances in which the indemnification  provided for in Section 7(A) or 7(B)
is due in accordance  with its terms but is for any reason held by a court to be
unavailable  on grounds of policy or  otherwise,  the Company and the  Placement
Agent shall contribute to the aggregate losses,  claims, damages and liabilities
(including  legal or other expenses  reasonably  incurred in connection with the
investigation  or defense of same) which the other may incur in such  proportion
so that the  Placement  Agent  shall be  responsible  for  such  percent  of the
aggregate of such losses,  claims,  damages and  liabilities  as shall equal the
percentage of the gross  proceeds  paid to the  Placement  Agent and the Company
shall be responsible for the balance;  provided,  however, that no person guilty
of  fraudulent  misrepresentation  within the  meaning  of Section  11(f) of the
Securities  Act shall be  entitled to  contribution  from any person who was not
guilty of such fraudulent misrepresentation.  For purposes of this Section 7(F),
any person controlling, controlled by or under common control with the Placement
Agent, or any partner, director, officer, employee,  representative or any agent
of any  thereof,  shall have the same rights to  contribution  as the  Placement
Agent and each person  controlling,  controlled by or under common  control with
the Company within the meaning of Section 15 of the Securities Act or Section 20
of the  Exchange  Act and each  officer of the Company and each  director of the
Company  shall have the same rights to  contribution  as the Company.  Any party
entitled to contribution will,  promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of which a claim
for  contribution  may be made against the other party under this Section  7(D),
notify such party from whom  contribution may be sought,  but the omission to so
notify  such party shall not  relieve  the party from whom  contribution  may be
sought from any  obligation  they may have  hereunder  or otherwise if the party
from whom contribution may be sought is not materially prejudiced thereby.


                                       11
<PAGE>

             G. The  indemnity  and  contribution  agreements  contained in this
Section 7 shall remain operative and in full force and effect  regardless of any
investigation  made by or on behalf of any indemnified person or any termination
of this Agreement.

             H. The Company  hereby waives,  to the fullest extent  permitted by
law, any right to or claim of any  punitive,  exemplary,  incidental,  indirect,
special,  consequential or other damages (including, without limitation, loss of
profits)  against the Placement Agent and each officer,  director,  shareholder,
employee or representative  of the placement agent and each person  controlling,
controlled  by or under  common  control  with the  Placement  Agent  within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act or
the Rules and  Regulations  arising out of any cause  whatsoever  (whether  such
cause  be  based  in  contract,  negligence,  strict  liability,  other  tort or
otherwise).  Notwithstanding  anything to the  contrary  contained  herein,  the
aggregate  liability  of  the  Placement  Agent  and  each  officer,   director,
shareholder,  employee or  representative of the Placement Agent and each person
controlling,  controlled  by or under common  control with the  Placement  Agent
within the  meaning of  Section  15 of the  Securities  Act or Section 20 of the
Exchange  Act or the Rules and  Regulations  shall not exceed  the  compensation
received by the Placement Agent pursuant to Section 2 hereof. This limitation of
liability shall apply regardless of the cause of action, whether contract,  tort
(including,  without  limitation,  negligence) or breach of statute or any other
legal or equitable obligation.

         8. Payment of Expenses.

         The Company  hereby  agrees to bear all of the  expenses in  connection
with the Offering,  including,  but not limited to the  following:  filing fees,
printing and duplicating  costs,  advertisements,  postage and mailing  expenses
with respect to the transmission of Offering  Materials,  registrar and transfer
agent fees,  escrow agent fees and expenses,  fees of the Company's  counsel and
accountants, issue and transfer taxes, if any.

         9. Conditions of Closing.

         The  Closing  shall  be  held at the  offices  of the  Investor  or its
counsel.  The  obligations of the Placement  Agent hereunder shall be subject to
the continuing accuracy of the representations and warranties of the Company and
the  Investor  herein as of the date  hereof and as of the Date of Closing  (the
"Closing Date") with respect to the Company or the Investor, as the case may be,
as if it had been made on and as of such Closing Date; the accuracy on and as of
the Closing Date of the  statements of the officers of the Company made pursuant
to the provisions hereof; and the performance by the Company and the Investor on
and as of the Closing Date of its covenants and obligations hereunder and to the
following further conditions:

             A. Upon the effectiveness of a registration  statement covering the
Standby  Equity  Distribution  Agreement,  the Investor and the Placement  Agent
shall  receive  the  opinion  of Counsel  to the  Company,  dated as of the date
thereof, which opinion shall be in form and substance reasonably satisfactory to
the Investor, their counsel and the Placement Agent.

             B. At or prior to the Closing, the Investor and the Placement Agent
shall have been furnished such  documents,  certificates  and opinions as it may
reasonably  require for the purpose of enabling  them to review or pass upon the


                                       12
<PAGE>

matters referred to in this Agreement and the Offering Materials, or in order to
evidence   the   accuracy,   completeness   or   satisfaction   of  any  of  the
representations, warranties or conditions herein contained.

             C. At and  prior to the  Closing,  (i)  there  shall  have  been no
material  adverse change nor development  involving a prospective  change in the
condition or prospects or the business  activities,  financial or otherwise,  of
the Company from the latest dates as of which such condition is set forth in the
Offering  Materials;  (ii)  there  shall  have been no  transaction,  not in the
ordinary course of business except the  transactions  pursuant to the Securities
Purchase  Agreement entered into by the Company on the date hereof which has not
been disclosed in the Offering  Materials or to the Placement  Agent in writing;
(iii) except as set forth in the Offering Materials, the Company shall not be in
default  under any  provision  of any  instrument  relating  to any  outstanding
indebtedness  for which a waiver or extension has not been  otherwise  received;
(iv) except as set forth in the Offering  Materials,  the Company shall not have
issued any securities (other than those to be issued as provided in the Offering
Materials)  or declared or paid any  dividend  or made any  distribution  of its
capital  stock of any  class and  there  shall  not have been any  change in the
indebtedness  (long or short term) or  liabilities or obligations of the Company
(contingent or otherwise) and trade payable debt; (v) no material  amount of the
assets of the Company shall have been pledged or mortgaged,  except as indicated
in the Offering Materials;  and (v) no action, suit or proceeding,  at law or in
equity,  against the Company or affecting  any of its  properties  or businesses
shall be  pending  or  threatened  before  or by any court or  federal  or state
commission,  board or other administrative agency, domestic or foreign,  wherein
an unfavorable decision, ruling or finding could materially adversely affect the
businesses, prospects or financial condition or income of the Company, except as
set forth in the Offering Materials.

             D. If requested at Closing the  Investor  and the  Placement  Agent
shall receive a certificate  of the Company  signed by an executive  officer and
chief financial officer,  dated as of the applicable Closing, to the effect that
the conditions set forth in subparagraph (C) above have been satisfied and that,
as of the applicable closing,  the representations and warranties of the Company
set forth herein are true and correct.

             E. The Placement  Agent shall have no obligation to insure that (x)
any check,  note,  draft or other means of payment for the Common  Stock will be
honored,  paid or enforceable against the Investor in accordance with its terms,
(y) the Offering is exempt from the registration  requirements of the Securities
Act or any applicable  state "Blue Sky" law or (z) the Investor is an Accredited
Investor.

         10. Termination.

         This Agreement  shall be co-terminus  with, and terminate upon the same
terms and  conditions  as those set forth in, the  Standby  Equity  Distribution
Agreement.  The rights of the Investor and the  obligations of the Company under
the Registration Rights Agreement, and the rights of the Placement Agent and the
obligations  of the Company  shall  survive the  termination  of this  Agreement
unabridged.


                                       13
<PAGE>

         11. Miscellaneous.

             A. This  Agreement  may be executed in any number of  counterparts,
each of which shall be deemed to be an  original,  but all which shall be deemed
to be one and the same instrument.

             B. Any notice  required or permitted to be given hereunder shall be
given in writing  and shall be deemed  effective  when  deposited  in the United
States mail, postage prepaid, or when received if personally  delivered or faxed
(upon  confirmation  of receipt  received by the sending  party),  addressed  as
follows to such other address of which written notice is given to the others):

If to Placement Agent, to:       Newbridge Securities Corporation
                                 1451 Cypress Creek Road, Suite 204
                                 Fort Lauderdale, Florida 33309
                                 Attention:  Doug Aguililla
                                 Telephone:  (954) 334-3450
                                 Facsimile:  (954) 229-9937

If to the Company, to:           Power Technology, Inc.
                                 109 North Post Oak Lane, Suite 422
                                 Houston, Texas 77024
                                 Attention:  Bernard J. Walter
                                 Telephone:  (713) 621-4310
                                 Facsimile:  (713) 688-0622

With a copy to:                  Stephen A. Zrenda, Jr., P.C.
                                 100 N. Broadway, Suite 2440
                                 Oklahoma City, OK 73102
                                 Attention:  Stephen A. Zrenda, Jr.
                                 Telephone:  (405) 235-2111
                                 Facsimile:  (405) 235-2157

If to the Investor:              Cornell Capital Partners, LP
                                 101 Hudson Street - Suite 3700
                                 Jersey City, New Jersey 07302
                                 Attention:  Mark A. Angelo
                                             Portfolio Manager
                                 Telephone:  (201) 985-8300
                                 Facsimile:  (201) 985-8266


                                       14
<PAGE>

With copies to:                  Cornell Capital Partners, LP
                                 101 Hudson Street - Suite 3700
                                 Jersey City, New Jersey 07302
                                 Attention:  Troy J. Rillo, Esq.
                                             Senior Vice President
                                 Telephone:  (201) 985-8300
                                 Facsimile:  (201) 985-8266

             C.  This  Agreement  shall  be  governed  by and  construed  in all
respects  under the laws of the State of New Jersey,  without  reference  to its
conflict of laws rules or principles. Any suit, action, proceeding or litigation
arising  out of or relating to this  Agreement  shall be brought and  prosecuted
exclusively  in such federal or state court or courts  located in Hudson County,
New Jersey.  The parties hereby irrevocably and  unconditionally  consent to the
jurisdiction  and venue of the Superior  Court of New Jersey,  sitting in Hudson
County, New Jersey, and the United States District Court of New Jersey,  sitting
in Newark,  New Jersey,  and to service of process by  registered  or  certified
mail,  return receipt  requested,  or by any other manner provided by applicable
law, and hereby  irrevocably and  unconditionally  waive any right to claim that
any suit, action, proceeding or litigation so commenced has been commenced in an
inconvenient forum.

             D.  This  Agreement  and the  other  agreements  referenced  herein
contain  the entire  understanding  between  the  parties  hereto and may not be
modified or amended  except by a writing  duly signed by the party  against whom
enforcement of the modification or amendment is sought.

             E. If any provision of this  Agreement  shall be held to be invalid
or unenforceable, such invalidity or unenforceability shall not affect any other
provision of this Agreement.



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                                       15
<PAGE>

         IN WITNESS WHEREOF,  the parties hereto have executed this Agreement as
of the date first written above.

                                             COMPANY:
                                             POWER TECHNOLOGY, INC.

                                             By:
                                                 ----------------------------
                                             Name:    Bernard J. Walter
                                             Title:   President


                                             PLACEMENT AGENT:
                                             NEWBRIDGE SECURITIES CORPORATION

                                             By:
                                                 ----------------------------
                                             Name:    Guy S. Amico
                                             Title:   President


                                             INVESTOR:
                                             CORNELL CAPITAL PARTNERS, LP

                                             By:      Yorkville Advisors, LLC
                                             Its:     General Partner

                                             By:
                                                 ----------------------------
                                             Name:    Mark A. Angelo
                                             Title:   Portfolio Manager




                                       16