<PAGE>

Exhibit 10.1

                          Strategic Alliance Agreement

         This Strategic Alliance Agreement is made this 8th day of October 2003,
by and between USA Technologies,  Inc., a Pennsylvania  corporation ("USA"), and
Conopco,  Inc.  dba  Unilever  Home & Personal  Care North  America,  a New York
corporation ("Unilever").

                                   Background

         USA is a provider of an unattended  laundry  injection  system known as
e-Suds, all as more fully described in Exhibit "A" hereto ("USA e-Suds System").
Unilever is a provider of laundry detergent and  conditioners,  all as described
in  Exhibit  "B"  ("Unilever  Products").  As more fully set forth  herein,  the
parties have entered into a strategic  alliance pursuant to which Unilever shall
act as a supplier of Unilever  Products to USA for use in the USA e-Suds  System
at the point of  consumption  in  colleges  and  universities  across the United
States.

                                    Agreement

         NOW THEREFORE, intending to be legally bound hereby, the parties hereto
agree as follows:


<PAGE>

         1. Sale of Unilever  Products.  During the term of this Agreement,  USA
agrees to purchase from Unilever and Unilever agrees to sell to USA the Unilever
Products for dispensing through the USA e-Suds Systems to be located in colleges
and universities across the United States. USA agrees to pay Unilever $35.36 per
5 gal. box (168 3.8oz.  Doses) of laundry  detergent  and $138.40 per 5 gal. Box
(640 1oz. Doses) of conditioner.  USA will monitor usage of Unilever Products at
the various locations and order Unilever Products as necessary. Each purchase of
Unilever  Product shall be governed by Unilever's  standard  terms of sale.  USA
shall be entitled to a 2% early payment discount calculated on the gross invoice
for  payments  received  within  19 days  for  checks  and  within  29 days  for
electronic  funds  transfers.  Unilever  agrees  (at its  cost) to  deliver  the
Unilever Products directly to the laundry operators as reasonably  instructed by
USA; provided, however, each such operator shall have no more than one location.

         Any  damaged  or  unusable  Unilever  Products  received  by a  laundry
operator  for use with a USA e-Suds  System will be  returned  to  Unilever  and
credited to USA in accordance  with  Unilever's  Unsaleable  Merchandise  Policy
attached hereto as Exhibit "C".

     USA agrees that the fee per box of laundry detergent and conditioner may be
increased  by  Unilever  in the event of a price  increase  to  Unilever  by its
suppliers.  The pricing will be reviewed each semester and any increase shall be
conditioned  upon Unilever's  production of documentation to USA that reasonably
substantiates the increase in costs to Unilever.

2.       Unilever Payments.

                  A.  Investment  Payments.  Subject to the  provisions  of this
         Section  2,  Unilever  shall pay to USA a fee based  upon the number of
         injections of Unilever  Products in the USA e-Suds  Systems  during the
         term hereof as set forth below (the "Investment Payments").



<PAGE>

                                                  Number of Forecasted
Semester              Cost Per Injection              Installations*

Spring 2004                $.1443                          -0-
Fall 2004                  $.1443                        2,000
Spring 2005                $ 0.07                        4,950
Fall 2005                  $ 0.07                       10,000
Spring 2006                $ 0.05                       24,000
Fall 2006                  $ 0.05                       50,000
Spring 2007                $0.045                       67,500
Fall 2007                  $0.045                      100,000
Spring 2008                $ 0.04                      152,500
Fall 2008                  $ 0.04                      250,000

*To be installed by February 1st and September 1st of each semester.

The  "Spring"  semester  means the four months of  February  through May and the
"Fall" semester means the eight months of June through January.  For purposes of
the above,  the cost per each  injection  does not change  based on the  product
dispensed.  The cost per  injection  applies  separately to detergent as well as
conditioner. For example, if a student injects detergent and conditioner for one
load of wash, it is counted as two (2) injections.

                  B.  Pre-Investment   Payments.  In  order  to  facilitate  the
acceptance of the USA e-Suds Systems into the  marketplace,  Unilever  agrees to
make  a  nonrefundable  payment  to  USA  as  described  below  ("Pre-Investment
Payment").  USA shall  distribute  the  Pre-Investment  Payments  to the various
operators to optimize the performance of the e-Suds business.  USA distributions
of  Pre-Investment  Payments  may also  include  but are not limited to operator
subsidies,  trade  events,  trade  advertising,  and/or other  pertinent  market
development fees.  Distributions of  Pre-Investment  payments will be limited to
operators who agree to allow  branding of their machines with the Unilever "all"
logo.  Branding  will be with a sign that includes the "all" logo and the slogan
"You can have it all" that is on the order of 3 inches by 10 inches. These signs
will be provided at  Unilever's  expense but  installed  by the  operators  in a
manner as approved by Unilever.  The  Pre-Investment  Payment for the  injection
fees shall be paid in advance of each semester as set forth below:


<PAGE>

Semester          Pre-Investment Payment             Payment Date
--------          ----------------------             ------------

Fall 2003         $  200,000.00                      12/15/2003
Spring 2004                   -                               -
Fall 2004         $   72,037.00                      11/15/2004
Spring 2005       $  145,530.00                      03/15/2005
Fall 2005         $  249,480.00                      11/15/2005
Spring 2006       $  519,750.00                      03/15/2006
Fall 2006         $  631,496.25                      11/15/2006
Spring 2007       $  935,550.00                      03/15/2007
Fall 2007         $1,268,190.00                      11/15/2007
Spring 2008       $2,079,000.00                      03/15/2008

         Beginning with Fall 2004 semester, the Pre-Investment Payments shall be
decreased (but not increased) by multiplying the relevant Pre-Investment Payment
by the following formula (the "Fulfillment Index"):

                  [# of installed washing machines on the first day of the month
                  in which  the  calculation  is made  times  the  average  # of
                  injections per machine for the prior semester]
                  ----------------------------------

                  [# of machines forecasted for the current semester times 693]

USA shall  calculate  and  deliver to  Unilever a  detailed  calculation  of the
Fulfillment Index and Pre-Investment Payment, as adjusted, by each February 15th
and September 15th during the term of this Agreement.

                  C.   Sales  in   Excess   of   Pre-Investment   Payment.   The
Pre-Investment Payment shall be credited towards the Investment Payment based on
the actual  injections  made during the applicable  semester(s) at the rates set
forth in Section A, above. When the  Pre-Investment  Payment is entirely offset,
USA will  invoice  Unilever  for the amount of the  Investment  Payment due as a
result of such excess.  USA will provide such invoice on a quarterly  basis with
payment due by Unilever within thirty (30) days of receipt of the invoice.

         3. USA Duties.  During the term of this  Agreement,  USA,  working with
existing  operators,  will  provide,  place,  network  and manage new USA e-Suds
Systems in colleges and  universities  located in the United States.  The e-Suds
services made available by USA will include:


<PAGE>

         o        Processing non-cash transactions

         o        Selling  detergent and conditioner  (consumables) at the point
                  of consumption

         o        Monitoring of  consumable  volume to ensure  efficient  supply
                  chain management

         o        Monitoring of machine status to ensure  machines are operating
                  at top performance

         o        Usage reporting to include  consumables usage on a college and
                  university  basis  by  product  SKU o Online  availability  of
                  machines

         o        E-mail notification to student machine users when wash and dry
                  cycles are complete

         o        Prioritizing,   managing   and   reporting   of  the   machine
                  installation schedule

         o        Calculating  the  formula  described  in  Section  2.B and the
                  amount of  Investment  Payment due each  semester  pursuant to
                  Section 2.C

         o        Managing initial  investment fund  transactions and continuing
                  operations with USA e-Suds systems operators

         o        All gang  controllers  included  in the system will be branded
                  with a sign that includes the all logo and the slogan "You can
                  have it all"  that is a  maximum  size of 2.5  inches  by 6.75
                  inches. These signs will be provided at Unilever's expense but
                  installed by USA and/or the operators.

         o        All  e-mail  alerts  for the  system  will be  branded  with a
                  message  that  includes  the all logo and the slogan  "You can
                  have it all". Unilever will provide these messages to USA.

         o        Using  its best  efforts  to obtain  access  for  Unilever  to
                  laundry  operators   facilities  and  systems  for  additional
                  branding opportunities,  at Unilever's expense, including, but
                  not limited to, laundry machines, websites, keycards, banners,
                  and liquid box packaging

         o        Insuring that the correct dosage of detergent is injected into
                  the machine as directed from time to time by Unilever

         4. Unilever Duties.  During the term of this Agreement,  Unilever shall
perform the following:


<PAGE>

                  A.  Supply the  Unilever  Products to USA from time to time as
described in Section 1 hereof;

                  B. Deliver to USA the Pre-Investment  Payments as set forth in
         Section 2 hereof;

                  C.  Deliver  to USA the  Investment  Payments  as set forth in
         Section 2 hereof; and

                  D. Provide the required engineering personnel and expertise to
         design and  implement  the cabinet  and pumping  lines into the washing
         machines  to be  used  by  the  USA  e-Suds  Systems  covered  by  this
         Agreement.

         5.  Technical  Collaboration.  Following the date hereof,  and upon the
     request of USA, USA and  Unilever  shall work  together to integrate  their
     respective  equipment  and systems so that a seamless USA e-Suds System can
     be  provided  to the  marketplace.  USA and  Unilever  shall  have  regular
     meetings to discuss development plans.

         6. Competition.

                  A.  During  the  term  hereof,   Unilever   shall  solely  and
         exclusively utilize the USA e-Suds System in the college and university
         market in the United  States for the  automated  delivery  of  Unilever
         Products to unattended  laundry  machines,  and shall not,  directly or
         indirectly, in any manner whatsoever, promote, utilize or recommend any
         other brand or type of service or products which are similar to the USA
         e-Suds System in such market.

                  B. During the term hereof,  USA shall  solely and  exclusively
         utilize  Unilever  Product for the USA e-Suds System in the college and
         university  market in the United States for the  automated  delivery of
         laundry detergents and conditioners to unattended laundry machines, and
         shall not, directly or indirectly,  in any manner whatsoever,  promote,
         utilize  or  recommend  any other  brand or type of  product  which are
         similar to Unilever Products in such market.

         7. Trademarks.


<PAGE>

                  A. During the course of its performance of this Agreement, USA
         shall  be  entitled  to  use  the   trademarks   of  Unilever  only  as
         specifically  provided in this  Agreement or as  otherwise  approved in
         writing by Unilever in advance.  USA acknowledges  that Unilever is the
         exclusive owner of such names and marks. USA further  acknowledges that
         USA has no other  license or similar  right with  respect to such marks
         and names, and covenants that it will neither claim nor assert any such
         right by reason of this Agreement or otherwise.

                  B.  During the course of its  performance  of this  Agreement,
         Unilever  shall  be  entitled  to use  the  trademarks  of USA  only as
         specifically  provided in this  Agreement or as  otherwise  approved in
         writing  by USA  in  advance.  Unilever  acknowledges  that  USA is the
         exclusive owner of such names and marks.  Unilever further acknowledges
         that  Unilever  has no other  license or similar  right with respect to
         such marks and names,  and  covenants  that it will  neither  claim nor
         assert any such right by reason of this Agreement or otherwise.

         8. Confidentiality.

                  A.  1.  Except  as  expressly  permitted  by  this  Agreement,
         Unilever shall not, directly or indirectly,  at any time from and after
         the date hereof, make any use of, exploit,  disclose, or divulge to any
         other  person,  firm or  corporation,  any  trade or  business  secret,
         information,    documents,    know-how,   data,   software,    samples,
         specifications,  formulae, technical descriptions,  method or means, or
         any other confidential  information concerning the business or policies
         of USA, or the USA e-Suds System, that Unilever learned as a result of,
         in  connection  with,  through  its  association  with,  or through its
         affiliation with USA, whether or not pursuant to this Agreement.

                           2. Except as expressly  permitted by this  Agreement,
                  USA shall not,  directly or  indirectly,  at any time from and
                  after the date hereof, make any use of, exploit,  disclose, or
                  divulge to any other person, firm or corporation, any trade or
                  business  secret,  information,   documents,  know-how,  data,
                  samples,  specifications,  formulae,  manufacturing processes,
                  technical   descriptions,   method  or  means,  or  any  other
                  confidential  information  concerning the business or policies
                  of Unilever,  or the Unilever Products,  that USA learned as a
                  result of, in connection with,  through its association  with,
                  or  through  its  affiliation  with  Unilever,  whether or not
                  pursuant to this Agreement.


<PAGE>

                           3. The  restrictions set forth in subsections 1 and 2
                  above  shall not apply to the  extent  that such  confidential
                  information either:(i) was known to the recipient prior to the
                  disclosure thereof by the disclosing party as shown by written
                  records; or (ii) is, or hereafter becomes,  other than through
                  the fault of the recipient, generally available to the public;
                  or (iii) is  disclosed  to the  recipient  by a third party in
                  under no obligation to keep such information confidential;  or
                  (iv)  is  developed  by  the  recipient  independently  of any
                  disclosures  made  hereunder,  as evidenced by the recipient's
                  written records.

                  B. Except relating to the design and implementation of cabinet
         and pumping  lines into  washing  machines to be used by the USA e-Suds
         Systems and as otherwise  expressly agreed to between USA and Unilever,
         all documents, data, know-how,  designs,  inventions,  names, method or
         means,   materials,   software  programs,   hardware,   configurations,
         information,  or any other  materials or data of any kind  furnished to
         Unilever by USA, or  developed by Unilever on behalf of USA or at USA's
         direction or for USA's use, or otherwise devised,  developed,  created,
         or invented in connection with Unilever's affiliation with USA, jointly
         or  otherwise,  and  which  relate  to the USA  e-Suds  System or USA's
         network  technology,  are and  shall  remain  the  sole  and  exclusive
         property  of  USA,  and  Unilever  shall  have  no  right  or  interest
         whatsoever  thereto,  including  but not  limited to any  copyright  or
         patent interest  whatsoever.  Unilever shall if requested,  execute any
         legal  instruments  deemed necessary by USA to carry out the foregoing.
         Except as  otherwise  expressly  agreed to between USA and Unilever all
         documents, data, know-how, designs, inventions, names, method or means,
         materials, software programs, hardware, configurations, information, or
         any other  materials or data of any kind  furnished to Unilever by USA,
         or developed by Unilever on behalf of USA or at USA's  direction or for
         USA's use, or otherwise  devised,  developed,  created,  or invented in
         connection with Unilever's  affiliation with USA, jointly or otherwise,
         and  relating to the design and  implementation  of cabinet and pumping
         lines into washing  machines to be used by the USA e-Suds Systems,  are
         and shall remain the sole and exclusive  property of Unilever,  and USA
         shall have no right or interest whatsoever  thereto,  including but not
         limited to any copyright or patent  interest  whatsoever.  USA shall if
         requested,  execute any legal instruments  deemed necessary by Unilever
         to carry out the  foregoing.  Notwithstanding  anything  else set forth
         herein,  in no event shall USA have any right,  title or interest in or
         to any  formulations  or  product  material  relating  to the  Unilever
         Products.


<PAGE>

                  C. Upon the termination or expiration of this Agreement, or at
         such earlier time as either party may request,  each party shall return
         to the other party such confidential  information within its possession
         or control.

                  D. Each party  agrees  that it will make  available  the other
         party's  confidential  information to persons  within its  organization
         only on a "need  to know"  basis  and that  all  persons  to whom  such
         confidential  information  is made  available will be made aware of the
         strictly  confidential nature of such confidential  information and the
         restrictions placed hereunder on the use thereof.

         9. Proprietary Software.

                  A.  Unilever   acknowledges   and  agrees  that  the  computer
         programs,   computer  software,   electronic  images,  computer  codes,
         computer  configurations,  and  sounds  ("Software")  contained  in  or
         utilized by the USA e-Suds System are proprietary  and  confidential to
         USA and protected  under United States  copyright law. USA shall retain
         all right, title and interest in and to the Software and the USA e-Suds
         System.  Unilever  shall not copy,  modify,  adopt,  translate,  merge,
         reverse engineer,  decompile,  or disassemble,  the Software or the USA
         e-Suds System,  or create any derivative works based on the Software or
         the USA e-Suds System.


<PAGE>

                  B. Unilever shall retain all right,  title and interest in and
         to the Unilever Products. USA shall not copy, modify, adopt, translate,
         merge,  reverse  engineer,  decompile,  or  disassemble,  the  Unilever
         Products,  or  create  any  derivative  works  based  on  the  Unilever
         Products.

         10. Expenses.  Unless otherwise  specifically agreed to by the parties,
any and all expenses, costs, obligations,  or liabilities whatsoever incurred by
the parties in connection  with the performance of this Agreement shall be borne
solely and exclusively by the party incurring such expense,  cost, obligation or
liability.

         11.      Term.

                  A.  This  Agreement  shall  commence  on the date  hereof  and
terminate  upon  the  expiration  of the  2008  Fall  semester.  Notwithstanding
anything else set forth  herein,  if and whenever any party hereto shall default
in the performance of any of the provisions of this  Agreement,  and the default
shall continue  unremedied  for a period of sixty-days  after receipt of written
notice  by the party in  default,  then upon the  expiration  of said  sixty-day
period,  the party  giving  said  notice  may,  at its  option,  terminate  this
Agreement by written notice of termination to the defaulting party. In addition,
Unilever may terminate this Agreement  immediately if the  Fulfillment  Index is
equal to or less  than  0.90  for two  consecutive  semesters.  Any  failure  to
terminate  hereunder  shall not constitute a condonation or waiver of subsequent
defaults. In the event of any such termination, other than any payment otherwise
due  hereunder  which  is  attributable  to the  period  prior  to such  date of
termination, and except as provided otherwise hereunder, this Agreement shall be
null and void and of no further effect.  The termination of this Agreement shall
not limit, modify or affect any cause of action that may otherwise exist for any
breach of this Agreement by either party hereto.


<PAGE>

                  B. Rights of First  Refusal.  If at any time within five years
following the expiration of this Agreement  pursuant to subsection A. above, USA
shall  desire to have any  person or entity  other  than  Unilever  (the  "Third
Party"),  supply  products  similar to the Unilever  Products for use in the USA
e-Suds System in colleges and  universities  across the United States,  then USA
shall give prompt written  notice  (referred to in this Section as the "Notice")
of that desire to Unilever,  together with a copy of a bona fide binding written
proposal.  Unilever shall have the right, but not the obligation,  within thirty
(30) days after  receipt of the Notice,  to elect to be the supplier of Unilever
Products to the USA e-Suds  System upon the terms and at the prices set forth in
the  proposal.  In the event  Unilever  desires to  exercise  its right of first
refusal,  Unilever  must provide  written  notice of that election to USA within
said thirty (30) day period  after the  receipt of the Notice.  Non-delivery  of
written notice by Unilever within the thirty (30) day period shall be conclusive
of the  fact  that  Unilever  chooses  not to  exercise  its  rights  hereunder;
provided,  however,  such  failure to exercise  such right shall not  extinguish
Unilever's  right of first refusal for  subsequent  periods during the five year
period  following the expiration of this Agreement.  In the event Unilever fails
to exercise its option,  then USA may proceed with the proposal only pursuant to
the price and upon all of the terms and conditions  thereof.  This  subsection B
shall not be applicable if this Agreement is terminated pursuant to subsection A
due to a breach by Unilever hereby.

                  C. Notwithstanding  anything else set forth herein, all of the
terms and  conditions  of Sections 7, 8, 9 11.B,  13 and 17 hereof shall survive
the expiration or termination of this Agreement.

         12. Relationship of Parties. USA, on the one hand, and Unilever, on the
other,  acknowledge  and  agree  that each of them are  independent  contractors
hereunder,  and that nothing contained in this Agreement shall deem to have made
them  partners,  joint  venturers,  or  otherwise.  In this  regard,  except  as
specifically  provided otherwise herein,  neither of their respective  officers,
employees,  or agents shall be employees,  officers, or agents of the other, and
neither  party  shall have the power or the  authority  to  obligate or bind the
other.

         13.      Indemnification.


<PAGE>

                  A. USA agrees to  reimburse,  indemnify  and hold Unilever (as
well as its employees and agents) harmless from and against all losses,  claims,
attorney's fees, liabilities,  costs, damages, judgements,  settlements,  and/or
expenses  which  Unilever (or its  employees or agents)  sustains or incurs as a
result of the breach of this  Agreement  by USA,  and/or from the  negligent  or
willful acts or omissions of USA in the  performance of this  Agreement,  and/or
arising from or in connection with the use by a location of USA's e-Suds System.
USA's  obligations  under this Section  shall  survive the  termination  of this
Agreement.

                  B. Unilever  agrees to  reimburse,  indemnify and hold USA (as
well as its employees and agents) harmless from and against all losses,  claims,
attorney's fees, liabilities,  costs, damages, judgements,  settlements,  and/or
expenses  which USA (or its employees or agents)  sustains or incurs as a result
of the breach of this  Agreement  by  Unilever,  and/or  from the  negligent  or
willful  acts or  omissions of Unilever in the  performance  of this  Agreement,
and/or  arising  from or in  connection  with the use by a location  of Unilever
Products.   Unilever's   obligations   under  this  Section  shall  survive  the
termination of this Agreement.

         14. Good Faith, Inspection Rights.

         A. USA and Unilever  shall  cooperate  with each other in good faith to
attempt to resolve any  business  issues which may arise in the future from time
to time.  In this regard,  the parties  shall take any  appropriate  actions and
execute  and  deliver  any  appropriate  documents  which  may be  necessary  or
appropriate to carry out the transactions contemplated by this Agreement.

         B. From time to time during the term of this Agreement, Unilever or its
designee,  upon prior written notice to USA and during regular business hours at
USA's offices, may inspect and make copies of all records maintained by or under
the  control of USA  relating  to USA's  books,  records and systems in order to
audit USA's  compliance  with this  Agreement,  including the prices  charged to
Unilever  hereunder;  provided,  however,  such inspections shall not take place
more than once every ninety (90) days.


<PAGE>

     15.  Notices.  Any  notices  or  consents  required  or  permitted  by this
Agreement  shall be in writing and shall be deemed  delivered  if  delivered  in
person or national overnight courier or sent by certified mail, postage prepaid,
return receipt requested,  as follows, unless such address is changed by written
notice hereunder:

                  If to USA:

                                    USA Technologies, Inc.
                                    100 Deerfield Lane, Suite 140
                                    Malvern, Pennsylvania 19355
                                    Attn. President

                  If to Unilever:

                                    Unilever Home & Personal Care North America
                                    33 Benedict Place
                                    Greenwich, Connecticut 06385
                                    Attn. President

                  With a  copy to:

                                    Conopco, Inc.
                                    390 Park Avenue
                                    New York, New York 10022
                                    Attn. General Counsel

         16.  Applicable  Law.  The  substantive  laws  of the  Commonwealth  of
Delaware  (without  regard to its  conflicts  of laws  rules)  shall  govern the
construction  of this  Agreement  and the rights  and  remedies  of the  parties
hereto. The headings of the Sections of this Agreement are for convenience only;
they form no part of this Agreement and shall not affect its interpretation.  If
any provision of this Agreement is held to be invalid, the same shall not affect
the remaining  provisions of this  Agreement  which shall continue in full force
and effect.

         17.  Arbitration.  All disputes,  controversies,  or  misunderstandings
whatsoever arising out of or in connection with this Agreement, shall be settled
and resolved by binding arbitration pursuant to the Commercial Arbitration Rules
of the American  Arbitration  Association.  The arbitration shall be convened in
the City of Wilmington , Delaware and shall be conducted by a single arbitrator.
The  costs  and  expenses  of the  arbitration,  as  well  as  the  arbitrator's
compensation  shall  be  paid by the  parties  as  shall  be  determined  by the
arbitrator.  The parties intend that this Section shall survive the  termination
of this Agreement.  The decision and award of the arbitrator  shall be final and
binding  upon the parties and  judgment may be entered on the award in any court
of competent jurisdiction.


<PAGE>

          18. Binding Effect.  This Agreement shall inure to the benefit of, and
shall be binding upon,  the respective  permitted  successors and assigns of the
parties hereto;  provided,  however,  that neither USA nor Unilever shall assign
this  Agreement  in whole or in part  without the prior  written  consent of the
other.  This  Agreement  constitutes  the entire  agreement  between the parties
hereto, and may only be amended or modified by a writing signed on behalf of the
parties hereto.



<PAGE>



         IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the day and year first above written.

USA TECHNOLOGIES, INC.              CONOPCO, INC.
                                    dba Unilever Home & Personal Care
                                    North America


By: /s/ Stephen Herbert             By: /s/ Bob Shipley
   --------------------                 --------------------
Name: Stephen Herbert               Name: Bob Shipley
Title: President                    Title:General Manager, Laundry
                                    and Homecare