IOWA DEPARTMENT OF ECONOMIC DEVELOPMENT
ENTERPRISE ZONE (EZ) PROGRAM AGREEMENT


   =====================================================================
       EZ AGREEMENT NUMBER:                  05-EZ-37

       APPLICATION APPROVAL DATE:            June 28, 2005

       AGREEMENT EFFECTIVE DATE:             June 28, 2005

       ENTERPRISE ZONE NAME:               Kossuth County/Algona EZ-1

                             Hydrogen Engine Center
       ZONE CERTIFICATION DATE:                 October 17, 2002
       ZONE EXPIRATION DATE:                    October 17, 2012

   =====================================================================

         THIS  ENTERPRISE  ZONE ("EZ")  AGREEMENT  is made by and among the IOWA
DEPARTMENT  OF ECONOMIC  DEVELOPMENT,  200 East Grand Avenue,  Des Moines,  Iowa
50309  ("Department" or "IDED"),  Kossuth County  ("Community"),  114 West State
Street, Algona, Iowa 50511, and Hydrogen Engine Center ("Business"), 602 E. Fair
St., Algona, Iowa 50511.

         WHEREAS,  the purpose of the Enterprise  Zone Program is to promote new
economic development in economically distressed areas; and

         WHEREAS,  the Community has designated and the Department has certified
the Enterprise Zone identified above; and

         WHEREAS,  eligible businesses locating or located in an enterprise zone
are  authorized  under this  program  to  receive  certain  tax  incentives  and
assistance  and  Business  has located,  or will  locate,  within the  certified
Enterprise Zone; and

         WHEREAS,   the  Enterprise   Zone   Commission   responsible   for  the
above-identified  Zone has recommended approval and the Department has found the
Business's application to be consistent with the Act's eligibility requirements;
and

         NOW THEREFORE,  in  consideration  of the mutual promises  contained in
this  Agreement  and  other  good and  valuable  consideration,  it is agreed as
follows:

                                    ARTICLE I
                                   DEFINITIONS

         As used in this Agreement, the following terms shall apply:

         1.1 "Act"  means 2003 Iowa Code  sections  15E.191  through  15E.196 as
amended by 2004 Iowa Acts, Senate File 2290.

         1.2.  "Agreement  Effective Date" means the date this Agreement becomes
effective and the Business is authorized to receive program benefits.

         1.3 "Agreement Expiration Date" means the date this Agreement ceases to
be in force and effect. This Agreement shall remain in effect while the Business
initially  satisfies its job creation  requirements and then for a ten (10) year
job maintenance requirement period as specified under Article 4.1.

         1.4  "Application  Approval  Date" means the date, as identified in the
text box  above,  on which the  Director  of the IDED  approved  the  Business's
Enterprise Zone application.

                                      -7-
<PAGE>
      EZ Agreement # 05-EZ-37
      Hydrogen Engine Center
      Page 2 of 9

         1.5 "Annual Base Rent" means the  Business'  annual lease payment minus
taxes, insurance, and operating or maintenance expenses.

         1.6 "Application Approval Date" means the date, as identified above, on
which the Director of the IDED approved the Business'  Application for Financial
Assistance.

         1.7     "Board" means the IDED Board.

         1.8 "Commission" or "Enterprise  Zone Commission"  means the enterprise
zone  commission  established  by the Community  responsible  for the designated
enterprise zone.

         1.9 "Enterprise Zone" means the site within the Community  certified by
the Board for the purpose of attracting private  investment within  economically
distressed counties or areas of cities within the state.

         1.10  "Full-time  Equivalent  (FTE)  Job" means the  employment  of one
person:

         a) For 8 hours per day for a 5-day,  40-hour  workweek for 52 weeks per
year, including paid holidays, vacations and other paid leave, or
         b) For the number of hours or days per week,  including  paid holidays,
vacations and other paid leave,  currently  established by schedule,  custom, or
otherwise,  as  constituting a week of full-time work for the kind of service an
individual performs for an employing unit

         1.11 "Project" means the activity,  or set of activities,  described in
this Agreement and the Application for Financial Assistance approved by IDED.

         1.12  "Project  Completion"  means  (1) the first  date upon  which the
average annualized  production of finished product for the preceding  ninety-day
period  at the  manufacturing  facility  operated  by the  Business  within  the
Enterprise  Zone is at least fifty percent of the initial design capacity of the
facility;  or (2) for  existing  or  non-manufacturing  facilities,  the date of
completion of all improvements included in the Project.

         1.13 "Project  Jobs" means the 41 new Full-time  Equivalent  (FTE) jobs
created by the location or expansion of the Business in the Enterprise Zone.

                                   ARTICLE II
                            ENTERPRISE ZONE BENEFITS

         2.1 Benefits  Available.  The  following  Enterprise  Zone benefits are
available to the Business under this Agreement:

         (a)  Supplemental  New Jobs  Credit.  As provided in Iowa Code  section
15.331,  the Business is eligible to claim a  supplemental  new jobs credit from
withholding  in an amount  equal to 1 1/2 percent of the gross wages paid by the
Business.  The  supplemental  new jobs credit available under this program is in
addition  to and not in lieu of the  program  and  withholding  credit  of 1 1/2
percent authorized under Iowa Code chapter 260E.

         Additional  new jobs  created by the  project,  beyond  those that were
agreed to in Article IV,  Section 4.1 of this  Agreement,  are  eligible for the
additional 1 1/2 percent  withholding  credit as long as those  additional  jobs
meet the local  Enterprise  Zone wage  eligibility  criteria and are an integral
part or a  continuation  of the  Project.  Approval  and  administration  of the
supplemental new jobs credit shall follow existing procedures  established under
Iowa Code chapter 260E.

         (b) Value-Added  Property Tax Exemption.  The Community has approved an
exemption from taxation all or a portion of the value added to the property upon
which the Business  locates or expands in the Enterprise  Zone and which is used
in the operation of the Business.  The amount of the exemption is as detailed in
Attachment  C,  "County  Board  of  Supervisors  or  City  Council"   Resolution
Authorizing Property Tax Exemptions for the Enterprise Zone."

<PAGE>
      EZ Agreement # 05-EZ-37
      Hydrogen Engine Center
      Page 3 of 9


         (c)  Investment  Tax Credit.  The Business may claim an investment  tax
credit as provided in Iowa Code section 15.333.  An investment tax credit may be
claimed of up to a maximum of ten percent (10%) of the new  investment  which is
directly related to the Project Jobs created by the location or expansion of the
Business in the  Enterprise  Zone.  The Business may not claim an investment tax
credit for capital  expenditures  above the amount stated in Article IV, Section
4.3 of this  Agreement.  The  credit  is to be taken in the year the  qualifying
asset is placed in service.  Any credit in excess of the tax  liability  for the
tax year may be credited to the tax liability  for the following  seven years or
until depleted, whichever occurs earlier.

         The capital expenditures eligible for the investment tax credit are:

         (i)  The purchase price of real property and any existing buildings and
              structures located on the real property.
         (ii) The cost of  improvements  made to real property  which is used in
              operation of the Business.
        (iii) The  costs of manufacturing machinery and equipment and computers,
              as defined in Iowa Code  section  427A.1(1)  "e" and "j" which are
              purchased  for use in the  operation of the Business and which the
              purchase price have been  depreciated in accordance with generally
              accepted accounting principles.
         (iv) Ten  (10)  years  of  Annual  Base  Rent  payments   provided  the
              cumulative  cost of these payments does not exceed the cost of the
              land and the  third-party  developer's  costs to build or renovate
              the building.

         (d) Additional  Research Activities Credit. The Business is eligible to
claim an additional  research activities credit as provided in Iowa Code section
15.335.  This benefit is a tax credit for increasing research activities in this
state  during the period the  Business  is  participating  in the  program.  For
purposes of claiming this credit, a business is considered to be  "participating
in the  program"  for a period  of ten (10)  years  from the date the  Business'
application was approved by the  Department.  The credit may equal up to six and
one-half  percent  (6.5%) of the  State's  apportioned  share of the  qualifying
expenditures for increasing research activities and is in addition to the credit
authorized in Iowa Code sections 422.10 and 422.33(5).  Any tax credit in excess
of the tax  liability  may be refunded to the Business  with interest or, at its
election, credited to its tax liability the following year.

         (e)  Refund Of Sales,  Service  And Use Taxes  Paid To  Contractors  Or
Subcontractors.  The Business is eligible for a refund of sales, service and use
taxes paid to contractors and  subcontractors as authorized in Iowa Code section
15.331A.

         (i)  The  Business  may  apply  for a refund of the sales and use taxes
              paid under Iowa Code  chapters  422 and 423 for gas,  electricity,
              water or sewer utility services, goods, wares, or merchandise,  or
              on  services  rendered,  furnished,  or  performed  to  or  for  a
              contractor  or  subcontractor  and  used in the  fulfillment  of a
              written  contract  relating to the  construction or equipping of a
              facility within the Enterprise Zone.
         (ii) Taxes attributable to intangible property and furniture and
              furnishings shall not be refunded.

         To  receive  a refund  of the  sales,  service  and use  taxes  paid to
contractors or subcontractors,  the Business must, within one year after project
completion, make an application to the Iowa Department of Revenue (IDR).

         2.2 Duration Of Benefits.  The Enterprise Zone designation shall remain
in effect for ten years following the date of certification.  Any state or local
incentives  or  assistance  that may be conferred  must be conferred  before the
designation  expires.  However,  the benefits of the incentive or assistance may
continue beyond the expiration of the Enterprise Zone designation.

         2.3 Benefits Not Available.  The following Enterprise Zone benefits are
not available to the Business under this agreement:

         (a)  Refund of Taxes  Attributable  to Racks,  Shelving,  and  Conveyor
Equipment.  The Business is eligible for a refund of sales and use taxes paid on
the purchase of racks,  shelving,  and conveyor  equipment as authorized in Iowa
Code section 15.331A.  The Business may apply for a refund of Iowa sales and use
taxes paid on the purchase of racks, shelving, and conveyor equipment to be used
in a warehouse  or  distribution  center.  In order to receive  the refund,  the
Business  shall submit the required  forms to IDED.  IDED will review the refund
<PAGE>
      EZ Agreement # 05-EZ-37
      Hydrogen Engine Center
      Page 4 of 9

request to ensure  that the  issuance  of a refund  would not  exceed  statutory
limits and then forward the refund request to the IDR for processing.


                                   ARTICLE III
                   REPRESENTATIONS AND WARRANTIES OF BUSINESS

         To induce the Department and the Community to authorize Enterprise Zone
benefits referred to in this Agreement,  the Business represents,  covenants and
warrants that:

         3.1 Authority. The Business is a corporation duly organized and validly
existing under the laws of its state of  incorporation  and is in good standing,
and has complied with all applicable  laws of the State of Iowa. The Business is
duly authorized and empowered to execute and deliver this Agreement.  All action
on the Business's part (e.g. where required, appropriate resolution of its Board
of  Directors)  for the  execution  and  delivery  of this  Agreement,  has been
effectively taken.

         3.2  Business   Information.   All  financial  statements  and  related
materials concerning the Business and the Project provided to the Department and
the Community are true and correct in all material  respects and  completely and
accurately  represent the subject matter thereof as of the effective date of the
statements and related  materials,  and no material  adverse change has occurred
since that date.

         3.3 Application. The contents of the application the Business submitted
to the  Department  for  Enterprise  Zone program  benefits  (Attachment A) is a
complete and accurate  representation  of the Business and the Project as of the
date of  submission  and  there  has  been no  material  adverse  change  in the
organization,  operation,  business prospects, fixed properties or key personnel
of the Business  since the date the Business  submitted its  application  to the
Department.

         3.4  Claims  And  Proceedings.   There  are  no  actions,  lawsuits  or
proceedings pending or, to the knowledge of the Business, threatened against the
Business affecting in any manner whatsoever its rights to execute this Agreement
or to otherwise comply with the obligations of the Business contained under this
Agreement. There are no actions, lawsuits or proceedings at law or in equity, or
before any governmental or administrative authority pending or, to the knowledge
of the  Business,  threatened  against or  affecting  the  Business'  ability to
proceed with the Project.

         3.5 Permits.  All necessary permits have been issued or will be applied
for in a timely manner with reasonable expectation that they will be issued.


                                   ARTICLE IV
                CONDITIONS TO RECEIPT OF ENTERPRISE ZONE BENEFITS

         The  Enterprise  Zone  Benefits  authorized  under  Article  II of this
Agreement  are  available to the  Business  provided  the  Business,  (and where
applicable, the Community) satisfies each of the following conditions:

         4.1 Job Creation And  Maintenance.  The Business shall create forty-one
(41)  full-time  positions  at the Project  site  within  three (3) years of the
Effective Date of this  Agreement.  The Business shall maintain the Project Jobs
for a period of ten (10) years from the date the  Business  first  meets its job
creation  obligation.  The Business shall develop and maintain a list of all the
Project Jobs.

         4.2 Average Wage.  The Business shall pay an average wage of $23.89/hr.
for the Project Jobs.

         4.3  Investment.  Within three (3) years of the Effective  Date of this
Agreement,  the Business  shall make a capital  investment of at least  $943,316
within the Enterprise Zone.

         4.4 Medical And Dental  Insurance.  The Business provides all full-time
employees with the option of choosing one of the following:
<PAGE>
      EZ Agreement # 05-EZ-37
      Hydrogen Engine Center
      Page 5 of 9

         (a)  The Business shall pay 80 percent of both of the following:

              (i) the cost of a standard medical insurance plan, and
             (ii) the cost of a standard dental insurance plan or an equivalent
                  plan;

         (b)  The Business  provides the employee  with a monetarily  equivalent
              plan to the plans provided in "a".

         4.5 Reserved for additional Commission standards

         4.6 Business  Retention.  The Business shall have and maintain  Project
operations  contemplated by this Agreement within the Community at least through
the Agreement Expiration Date.

         4.7  Records  And  Accounts.  The  Business  shall  maintain  job  data
information,  books,  records,  documents  and  other  evidence  concerning  the
Project,  in  sufficient  detail to permit the  Department  and the Community to
assess  compliance with the terms of this  Agreement.  The Business shall retain
the  aforementioned  records for a period of three (3) years from the  Agreement
Expiration Date.

         4.8  Access To  Records/Inspections.  The  Business  shall,  upon prior
reasonable  notice and at any time (during normal  business  hours),  permit the
Community and its representatives and the Department, its representatives or the
State Auditor to examine, audit and/or copy
         (i)  any plans and work details pertaining to the Project,
        (ii)  all of the Business' books,  records and accounts  relating to the
              Project, and
       (iii)  all other documentation or materials related to this Agreement.

         The  Business   shall  provide   proper   facilities  for  making  such
examination  and/or  inspection.  Records  of  the  Business  furnished  to  the
Department in connection with this Project are subject to the provisions of Iowa
Code chapter 22 and  administrative  rules adopted by the Department  concerning
public records and requests for confidential treatment of records.

         4.9 Notice Of  Proceedings.  The  Business  shall  promptly  notify the
Community  and  IDED  of the  initiation  of any  claims,  lawsuits,  bankruptcy
proceedings  or other  proceedings  brought  against  the  Business  which would
adversely impact the Project.

         4.10   Reports; Community Monitoring/Reporting.

         (a)  Authorization  for Release of Confidential  State Tax Information.
         The Business shall execute an Authorization for Release of Confidential
         State Tax  Information  form,  to permit IDED to receive the  Business'
         state tax information  directly from the Iowa Department of Revenue for
         purposes of annually  updating  the Iowa  Public  Return on  Investment
         Analysis for this Project.  The Business shall submit to IDED any other
         information  requested  by IDED to  update  the Iowa  Public  Return on
         Investment Analysis for this Project.

         a) Compliance Report.  The Business shall prepare,  sign and submit the
         following compliance report:

                  Report                                      Due Date
                  ------                                      --------

                  Compliance Report         January 30

         The Business shall,  for the length of its designation as an Enterprise
Zone  business,  certify  annually  to the  Community  and  the  Department  its
compliance with the  requirements of the Act.  Documentation  of compliance with
the  conditions  detailed  in  Article  IV shall  be  included  with the  annual
certification.

         4.11 Notice Of Business  Changes.  The Business  shall  provide  prompt
advance notice to the Community and the Department of any proposed change in the
Business  ownership,  structure or control which would  materially  and directly
affect the Project.
<PAGE>
      EZ Agreement # 05-EZ-37
      Hydrogen Engine Center
      Page 6 of 9

                                    ARTICLE V
                              DEFAULT AND REPAYMENT

         5.1 Events Of Default. Enterprise Zone benefits described in Article II
are only  available  to the Business to the extent the  Business  satisfies  the
conditions  described in Article IV. Any of the  following  shall  constitute an
Event of Default under this Agreement:

         (a)  Material  Misrepresentation.  If at any time  any  representation,
warranty or statement  made or furnished to the  Department or the Community by,
or on behalf of, the Business in connection with this Agreement or to induce the
Department or Community to be incorrect,  false,  misleading or erroneous in any
material respect when made or furnished.

         (b)  Breach Of  Agreement.  If there is a failure  of the  Business  to
comply  with  any of the  covenants,  terms  or  conditions  contained  in  this
Agreement.

         (c) Relocation Or Abandonment.  If there is a relocation or abandonment
of the  Business or jobs  created  under the Project and the  Business  fails to
renew  operation of the Business  within the Enterprise  Zone within 30 days. If
the  relocation  or  abandonment  is  due to a  natural  disaster  (e.g.  flood,
tornado),  the  Business  shall  have 120 days to renew  operations  within  the
Enterprise Zone.

         (d)  Insolvency Or  Bankruptcy.  If the Business  becomes  insolvent or
bankrupt, or admits in writing its inability to pay its debts as they mature, or
makes an assignment for the benefit of creditors, or the Business applies for or
consents to the appointment of a trustee or receiver for the Business or for the
major part of its  property;  or if a trustee or receiver is  appointed  for the
Business or for all or a substantial  part of the assets of the Business and the
order of such appointment is not discharged, vacated or stayed within sixty (60)
days after such  appointment;  or if  bankruptcy,  reorganization,  arrangement,
insolvency, or liquidation proceedings or other proceedings for relief under any
bankruptcy or similar law or laws for the relief of debtors,  are  instituted by
or against the Business  and, if instituted  against the Business,  is consented
to, or, if contested by the Business is not dismissed by the adverse  parties or
by an order, decree or judgment within sixty (60) days after such institution.

         5.2    Notice Of Default.

         (a) From  Department.  If, through the annual  certification  report or
other means,  the Department has reason to believe the Business is in default of
the terms of this  Agreement,  the  Department  will  issue a written  notice of
default to the  Business,  setting forth the nature of the default in reasonable
specificity,  and providing therein a reasonable period of time, which shall not
be less  than 30 days  from the date of the  notice  of  default,  in which  the
Business shall have an  opportunity to cure,  provided that cure is possible and
feasible. A copy of any Notice of Default will also be provided to the Community
and Department of Revenue.

         (b) From Community.  If, through  monitoring,  auditing or other means,
the  Community  has reason to believe the Business is in default of the terms of
this  Agreement,  the  Community  will issue a written  notice of default to the
Business, setting forth the nature of the default in reasonable specificity, and
providing  therein a reasonable  period of time, which shall not be less than 30
days from the date of the notice of default, in which the Business shall have an
opportunity to cure, provided that cure is possible and feasible.  A copy of any
Notice of Default  will also be provided to the  Department  and  Department  of
Revenue.

         5.3  Repayment.  If the Business has received  incentives or assistance
under the Act and fails to meet and maintain any one of the  requirements of the
Act, the Administrative  Rules or Article IV of this Agreement,  the Business is
subject to repayment of all or a portion of the incentives  and assistance  that
it has received.

         (a) Job  creation  shortfall.  If the  Business  does  not meet its job
creation requirement, repayment shall be calculated as follows:
                (i)   If  the  Business  has  met  50  percent  or  less  of the
                      requirement,  the Business shall repay the same percentage
                      in benefits as the Business failed to create in jobs.
<PAGE>
      EZ Agreement # 05-EZ-37
      Hydrogen Engine Center
      Page 7 of 9

                (ii)  If the Business has met more than 50 percent, but not more
                      than 75 percent of the  requirement,  the  Business  shall
                      repay  one-half  of  the  percentage  in  benefits  as the
                      Business failed to create in jobs.
                (iii) If the  Business has met more than 75 percent but not more
                      than 90 percent of the  requirement,  the  Business  shall
                      repay  one-quarter  of the  percentage  in benefits as the
                      Business failed to create in jobs.
                (iv)  If the  Business  has  not met the  minimum  job  creation
                      requirement  of ten (10) new full-time  jobs, the Business
                      shall repay all of the incentives  and assistance  that it
                      has received.

         (b) Wages and benefits.  If the Business  fails to comply with the wage
or benefit requirements, the Business shall not receive Enterprise Zone benefits
for each year during which the Business is not in compliance.

         (c)  Capital  Investment.  If the  Business  does not meet the  capital
investment requirement, repayment shall be calculated as follows:
                (i)   If  the  Business  has  met  50  percent  or  less  of the
                      requirement,  the Business shall repay the same percentage
                      in benefits as the Business failed to invest.
                (ii)  If the  Business has met more than 50 percent but not more
                      than 75 percent of the  requirement,  the  Business  shall
                      repay  one-half  of  the  percentage  in  benefits  as the
                      Business failed to invest.
                (iii) If the  Business has met more than 75 percent but not more
                      than 90 percent of the  requirement,  the  Business  shall
                      repay  one-quarter  of the  percentage  in benefits as the
                      Business failed to invest.
                (iv)  If  the  Business  has  not  met  the  minimum  investment
                      requirement  of $500,000 the  Business  shall repay all of
                      the incentives and assistance that it has received.

         (d)  Department  of  Revenue;  community  recovery.  Once  it has  been
established,  through the Business' annual certification,  monitoring,  audit or
otherwise,  that the  Business  is  required  to repay all or a  portion  of the
incentives  received,  the Department of Revenue and the Community shall collect
the amount owed. The Community has the  authority,  pursuant to the Act, to take
action to recover the value of taxes not  collected as a result of the exemption
provided  by the  Community  to the  Business.  Department  of  Revenue  has the
authority,  pursuant  to the  Act,  to  recover  the  value  of  state  taxes or
incentives  provided under the Act. The value of state incentives provided under
the Act includes applicable interest and penalties.

         5.4 Layoffs and Facility Closures. If the Business experiences a layoff
within the State of Iowa or closes any of its Iowa facilities prior to receiving
Enterprise  Zone  benefits,  the  Department  may reduce or  eliminate  all or a
portion of the benefits.  If a business experiences a layoff within the State of
Iowa or  closes  any of its Iowa  facilities  after  receiving  Enterprise  Zone
benefits,  the Business shall be subject to repayment of all or a portion of the
incentives and assistance that it has received.


                                   ARTICLE VI
                          GENERAL TERMS AND PROVISIONS

         6.1  Compliance  With Laws And  Regulations.  The Business shall comply
with all applicable State and federal laws, rules (including the  administrative
rules), ordinances, regulations and orders.

         6.2 Termination.  This Agreement may be terminated by the Department or
the  Community:  (a) in the event of an unremedied  material Event of Default by
the Business under Article V of this Agreement;  (b) by mutual  agreement of all
parties.

         6.3 Survival Of Agreement.  If any portion of this Agreement is held to
be invalid or unenforceable, the remainder shall be valid and enforceable.

         6.4 Governing  Law. This  Agreement  shall be interpreted in accordance
with the law of the State of Iowa,  and any action  relating  to this  Agreement
shall only be commenced in the Iowa District Court for Polk County or the United
States District Court for the Southern District of Iowa.
<PAGE>
      EZ Agreement # 05-EZ-37
      Hydrogen Engine Center
      Page 8 of 9

         6.5  Modification.  This  Agreement  may only be  modified by a written
document signed by all Parties.

         6.6 Notices.  Whenever this Agreement requires or permits any notice or
written request by one party to another, it shall be in writing,  enclosed in an
envelope, addressed to the party to be notified at the address heretofore stated
(or at such  other  address  as may have been  designated  by  written  notice),
properly  stamped,  sealed and  deposited in the United  States  Mail.  Any such
notice  given  hereunder  shall be deemed  delivered  upon the earlier of actual
receipt or three (3) business days after posting. The Department may rely on the
addresses of the Business and Community set forth  heretofore,  as modified from
time to time, as being the addresses of the Community and Business.

         6.7  Waivers.  No waiver by a party of any Event of  Default  hereunder
shall  operate as a waiver of any other Event of Default or of the same Event of
Default on any future  occasion.  No delay on the part of a party in  exercising
any right or remedy  hereunder shall operate as a waiver  thereof.  No single or
partial  exercise  of any  right or  remedy  by a party  shall  preclude  future
exercise thereof or the exercise of any other right or remedy.

         6.8 Headings.  The headings in this  Agreement are intended  solely for
convenience  of reference and shall be given no effect in the  construction  and
interpretation of this Agreement.

         6.9  Integration.  This  Agreement  contains  the entire  understanding
between the Community,  Business and the Department and any representations that
may have been made before or after the signing of this Agreement,  which are not
contained  herein,  are nonbinding,  void and of no effect.  None of the parties
have relied on any such prior representation in entering into this Agreement.

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

         6.11 Documents  Incorporated By Reference.  The following documents are
hereby incorporated by reference:

         a. Attachment A, "Business's Application for Financial Assistance."
         b.  Attachment B, "Enterprise Zone Commission  Resolution Approving the
             Business' Enterprise Zone Application."
         c.  Attachment  C,  "County  Board  of   Supervisors  or  City  Council
             Resolution  Authorizing  Property Tax Exemptions for the Enterprise
             Zone."

         6.12 Order Of Priority. In the event of a conflict between documents of
this Agreement, the following order of priority shall govern:

         a.  Articles 1 through 6 herein.
         b.  Attachment A, "Business's Application for Financial Assistance."
         c.  Attachment B, "Enterprise Zone Commission  Resolution Approving the
             Business's Enterprise Zone Application."
         d.  Attachment  C,  "County  Board  of   Supervisors  or  City  Council
             Resolution  Authorizing  Property Tax Exemptions for the Enterprise
             Zone."

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the Effective Date first stated:

<PAGE>
      EZ Agreement # 05-EZ-37
      Hydrogen Engine Center
      Page 9 of 9



FOR THE COMMUNITY:                         FOR IDED:
Kossuth County

/s/ Eugene Elsbecker                        /s/ Mary Lawyer
---------------------------------          -------------------------------------
Signature                                  Mary Lawyer, Acting Director

Eugene Elsbecker, Chair
---------------------------------
Type or Print Name, Title



FOR THE BUSINESS:
Hydrogen Engine Center


/s/ Theodore Hollinger
---------------------------------
Signature

Theodore Hollinger [President]
---------------------------------
Type or Print Name, Title