Document:

Employment Contract

                                     between

                     Advanced Medical Institute Pty Limited

                              (ABN 56 095 238 645)

                                       and

                                 Dr Jack Vaisman

<PAGE>

                                    Contents

Clause
number    Heading                                                         Page

1         Dictionary                                                         1

2         Identity of the Employer and Employee                              1

3         Commencement                                                       1

4         Duration of Employment                                             1

5         The Position                                                       1

6         Location of Employment                                             2

7         Travel                                                             2

8         Conduct and Performance                                            2

9         Performance Standards and Review                                   2

10        Conflicts of Interest and Code of Conduct                          3

11        Hours of Work                                                      3

12        Base Salary Package                                                4

13        Bonus                                                              4

14        Refund of expenses and provision of allowances                     5

15        Annual Leave                                                       5

16        Long Service Leave                                                 5

17        Sick Leave                                                         5

18        Policies and Procedures                                            6

19        Occupational Health and Safety                                     6

20        Anti-discrimination and Harassment                                 6

21        Use of Employer's Facilities                                       7

22        Termination Upon Prior Notice                                      7

23        Summary Termination                                                8

24        Appointment to and Resignation from Offices                        9

25        Suspension                                                         9

26        Confidential Information and Insider Trading                      10

                                       i
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27        Return of Property and Documents upon Termination                 11

28        Post-Employment Restrictions                                      11

29        Entire Agreement                                                  11

30        No Representations and Warranties                                 11

31        Governing Law and Jurisdiction                                    11

32        Independent Legal Advice                                          12

          Schedule A                                                        14
          Job Description                                                   14

          Schedule B                                                        15
          Confidential Information                                          15

          Schedule C                                                        16
          Post-Employment Restrictions                                      16

                                       ii
<PAGE>

                               Employment Contract

1     Dictionary

1.1   For the purpose of this contract, the following terms have the meanings
      set out below.

      "Employment" means the employment of the Employee by the Employer.

      "Document" means any record of information.

      "Position" means the position of Chief Executive Officer and Managing
      Director of the Employer.

      "Related Body Corporate" has the same meaning as that set out in section
      50 of the Corporations Act 2001.

1.2   Other terms may be specially defined elsewhere in this contract.

2     Identity of the Employer and Employee

2.1   The Employer is Advanced Medical Institute Pty Limited (ABN 56 095 238
      645) of Level 1, 204-218 Botany Road, Alexandria NSW 2015.

2.2   The Employee is Dr Jack Vaisman of 131/18 Waverley Road, Bondi Junction
      NSW 2022.

2.3   The Employee will promptly notify the Employer in writing of any change to
      the residential address of the Employee.

3     Commencement

3.1   The Employee has been employed by the Employer or its associated companies
      since 1 March 1993.

3.2   The parties have agreed to amend the terms and conditions of the
      Employment, with effect from 1 July 2005 ("Effective Date"), and to set
      out in this contract the terms and conditions of the Employment in effect
      on and from the Effective Date.

4     Duration of Employment

The Employment will continue indefinitely until terminated by either party in
accordance with the terms of this contract.

5     The Position

5.1   The Employee will be employed in the position of Chief Executive Officer
      and Managing Director.

5.2   In the Position, the Employee will report directly to the Employer's board
      of directors.

<PAGE>

5.3   A description of the duties and responsibilities of the Position is set
      out in Schedule A. This description is not intended to be exhaustive and
      the Employer may require the Employee to perform other duties in addition
      to or instead of those set out in Schedule A.

5.4   The Employee warrants that the Employee is not subject to any direct or
      indirect restrictions on the Employee's ability to fully perform the
      duties of the Position and will not be breaching any obligation to a third
      party by entering into this contract.

6     Location of Employment

6.1   The Employment will initially be based at the Employer's workplace at
      Level 1, 204-218 Botany Road, Alexandria NSW 2015.

6.2   The Employer may change the base of the Employment to any location within
      the Sydney Metropolitan Area at any time by giving the Employee at least
      one month's notice in writing. In the event of such relocation, the
      Employee will not be entitled to any additional remuneration.

7     Travel

7.1   The Employee acknowledges that the nature of the position requires
      frequent and unscheduled travel.

7.2   The Employee must engage in such travel without any additional
      remuneration and as required by the Employer. All reasonable and proper
      expenses associated with such travel will be borne by the Employer in
      accordance with clause 13.

8     Conduct and Performance

8.1   The Employee must:

      (a)   comply with the lawful directions of the Employer;

      (b)   serve the Employer and fulfil the duties of the Position honestly,
            faithfully and in a professional manner;

      (c)   use the Employee's best efforts to promote the business of the
            Employer;

      (d)   fully and truthfully answer any questions asked by the Employer
            regarding the Employment; and

      (e)   fully report to the Employer all business opportunities which may
            advantage the Employer and any significant threats to the Employer's
            business as soon as these come to the attention of the Employee.

8.2   The Employee warrants that the Employee is not subject to any restrictions
      on the Employee's ability to perform the duties of the Position.

9     Performance Standards and Review

9.1   The Employee must answer fully and truthfully all questions relating to
      the Employee's performance and conduct.

9.2   The Employee must attend and participate in all performance interviews,
      and complete any performance related questionnaires or appraisal forms.

<PAGE>

9.3   The Employee's performance will be reviewed by the Employer throughout the
      Employment and at least once every year of service on or about 31
      December.

9.4   The Employee must meet the minimum performance standards usually
      applicable to a chief executive officer for a similar size organisation.
      If the Employee fails to meet these standards, the Employer may take
      disciplinary action against the Employee. This disciplinary action may
      include the termination of the Employment.

9.5   The performance standards represent minimum requirements only and are not
      intended to constitute an exhaustive list of the performance measures
      which will be used by the Employer to assess the Employee.

9.6   The Employer may review and amend these minimum performance standards at
      the beginning of each financial year or at any other time after
      consultation with the Employee.

10    Conflicts of Interest and Code of Conduct

10.1  The Employee must not undertake any activity (including paid or unpaid
      work) which may either compromise or give rise to a conflict with either:

      (a)   the Employee's duties and responsibilities under this contract; or

      (b)   the business interests of the Employer,

      unless the Employee has obtained the prior consent of the Employer in
      writing. The Employer acknowledges that the Employee has disclosed his
      business relationship with Yayasan On-Clinic, a business which operates an
      Indonesian business which is similar to the Employer's Australian
      business, and the Employee's ownership of certain intellectual property in
      fields similar to the Employer's business. The Employer acknowledges and
      agrees that the Employee is entitled to licence that intellectual property
      to a third party outside Australia and be involved in businesses similar
      to the Employer's business outside Australia. The Employer also
      acknowledges that the Employee is engaged in medication formulation and
      development separate tot eh Employee's employment with the Employer and
      that the Employee (or his nominee) will own any intellectual property
      relating from such activities.

10.2  The Employee must immediately and fully disclose in writing to the
      Employer any potential or actual conflicts of interest.

10.3  The Employee is not prevented by this clause from:

      (a)   any reasonable involvement in any professional or educational
            activity or body; or

      (b)   trading in any shares or stock of any company which is listed on a
            recognised stock exchange for the purpose of investment only,
            provided that such shares or stock do not exceed 5% of the company's
            issued capital, excepting shares in the Employer (in respect of
            which the Employee continues nevertheless to be subject to all other
            relevant obligations, including under statute and in equity).

10.4  The obligations contained in this clause are not intended to detract from
      the Employee's express and implied obligations to act in good faith and
      fidelity towards the Employer.

11    Hours of Work

The Employee is engaged on a full time basis and is expected to devote the
Employee's full time and attention to the business of the Employer during normal
working hours, and when necessary, after such hours without further remuneration
or time off in lieu.

<PAGE>

12    Base Salary Package

12.1  The Employer will provide a gross base salary package of $350,000 per
      annum plus employer superannuation contributions in accordance with clause
      12.3.

12.2  The Employer will pay the base salary to the Employee in fortnightly
      instalments into a bank account nominated by the Employee. The instalments
      will be paid in arrears.

12.3  In accordance with the federal Superannuation Guarantee Scheme, the
      Employer will make employer superannuation contributions for the benefit
      of the Employee into a complying superannuation fund. The employer
      superannuation contributions will be the minimum amount required for the
      Employer to avoid the payment of a superannuation guarantee charge.

12.4  The level of the Employee's gross base salary package will be reviewed by
      the Employer annually on or about 31 December. In undertaking this review
      the Employer may have regard to any matter in its absolute discretion,
      including but not limited to the performance of the Employee, the
      performance of the Employer, the prevailing economic conditions, the
      Employer's business requirements and its capacity to pay. This review will
      not necessarily lead to an increase in base salary.

13    Bonus

13.1  The Employee is eligible to participate in a discretionary bonus scheme
      operated by the Employer ("the Scheme").

13.2  Under the Scheme, the Employee may receive a bonus following the
      completion of each calendar year, to be determined at the sole and
      absolute discretion of the Employer, which bonus will only be payable if
      the Employee remains employed by the Employer as at the date the bonus, if
      any, is to be paid.

13.3  The bonus will be payable within 3 months after the end of the relevant
      calendar year.

13.4  The Employer may take into account such matters which it believes to be
      relevant, which may include the individual performance of the Employee as
      well as the overall performance of the Employer.

13.5  No bonus will be payable in relation to a financial year unless the
      Employer's overall financial performance exceeds the minimum target set by
      the board. The minimum financial target applying to the current calendar
      year ending 31 December 2005 will be consolidated Net Income of the
      Employer (before income tax expenses and excluding any capital profits
      received from sale of assets), as determined in accordance with the
      applicable Australian accounting standards, of A$1.5 million.

13.6  The conferral and value of any bonus under the Scheme will at all times be
      within the sole and absolute discretion of the Employer.

13.7  Notwithstanding the foregoing, providing the Employee's overall
      performance is excellent, it is envisaged that the Employee's bonus for
      the current calendar year ending 31 December 2005 will be an amount of up
      to 7% of that portion of the Employer's Net Income (before income tax
      expenses and excluding any capital profits received from sale of assets)
      that is above the target amount set under clause 13.5 for that calendar
      year.

13.8  The Employer may vary the terms of or cancel the Scheme at any time.

<PAGE>

14    Refund of expenses and provision of allowances

14.1  Any business expenses which the Employee necessarily incurs for the
      purpose of carrying out the duties of the Position will be reimbursed by
      the Employer provided that:

      (a)   the expenses are reasonable and related directly to the Employer's
            business;

      (b)   the Employee has provided the Employer with itemised receipts of
            these expenses, and any other additional evidence of these expenses
            as it may reasonably require; and

      (c)   the Employee complies with any other policy or procedure published
            by the Employer from time to time regarding the reimbursement of
            expenses.

14.2  In addition to the Employee's base remuneration and bonus, the Employer
      will provide the Employee with a car allowance of $35,000 per annum.

15    Annual Leave

15.1  The Employee is entitled to take annual holidays in accordance with the
      provisions of the Annual Holidays Act 1944 (NSW).

15.2  The Employee is not entitled to annual leave loading.

15.3  The Employer has the right to direct the Employee to take accrued annual
      leave by giving one month's notice.

15.4  The Employee acknowledges that the Employer may take into account its
      business requirements when either accepting or rejecting an application
      from the Employee to take annual holidays at a particular time.

15.5  Whilst on such leave, the Employee will not engage in any conduct which is
      inconsistent with the Employee's duties and responsibilities under this
      contract.

15.6  The parties agree and acknowledge that the Employee's accrued annual leave
      as at the date of this contract totals 120 days.

16    Long Service Leave

16.1  The Employee is entitled to take long service leave in accordance with the
      provisions of the Long Service Leave Act 1955 (NSW).

16.2  The Employee acknowledges that the Employer may take into account its
      business requirements when either accepting or rejecting an application
      from the Employee to take long service leave at a particular time.

16.3  Whilst on such leave, the Employee will not engage in any conduct which is
      inconsistent with the Employee's duties and responsibilities under this
      contract.

16.4  The parties agree and acknowledge that the Employee's commencement of
      employment for the purpose of calculating long service leave entitlements
      was 1 March 1993.

17    Sick Leave

17.1  The Employee will be entitled to 8 days' sick leave on full remuneration
      per year of service, provided that, when taking sick leave, at the first
      available opportunity the Employee:

<PAGE>

      (a)   promptly notifies the Employer of the proposed absence on sick
            leave, the reason for taking the sick leave, and the expected
            duration of the absence;

      (b)   upon request, provides the Employer with a medical certificate
            signed by a registered medical practitioner which sets out the
            reason for the Employee's absence and the expected duration of
            absence; and

      (c)   the Employee provides the Employer with any other medical evidence
            in relation to the sick leave as required by the Employer.

17.2  Untaken sick leave will accumulate from year to year up to a total
      accumulation of 100 days. The Employer and the Employee agree and
      acknowledge that the Employee has accumulated 100 days as at the date of
      this contract.

17.3  The Employee will not be entitled to receive any payment for untaken sick
      leave days upon termination or at any other time.

18    Policies and Procedures

18.1  The Employee must comply with the employment policies and procedures of
      the Employer as published and amended by the Employer from time to time.

18.2  The Employer will notify the Employee in writing of any changes to its
      employment policies and procedures.

19    Occupational Health and Safety

19.1  The Employee must:

      (a)   safely attend to the duties of the Position;

      (b)   familiarise himself with all occupational health and safety laws and
            the regulations which are relevant to the duties of the Position,
            and also the occupational health and safety policies and procedures
            of the Employer;

      (c)   comply with the above and take steps to ensure that the employees of
            the Employer comply with the above;

      (d)   immediately notify the board of directors of any potential or actual
            occupational health and safety risks;

      (e)   take a pro-active interest in eliminating or reducing health and
            safety risks to the Employee and to others in the workplace; and

      (f)   co-operate with the Employer in its efforts to comply with
            occupational health and safety requirements.

20    Anti-discrimination and Harassment

20.1  The Employer is an equal opportunity employer and will not tolerate
      unlawful discrimination or harassment at its workplace.

20.2  The Employee must at all times comply with and ensure that the employees
      of the Employer comply with the anti-discrimination and harassment
      policies of the Employer.

20.3  The Employee must immediately notify the board of directors as soon the
      Employee becomes aware of any unlawful discrimination or harassment.

<PAGE>

21    Use of Employer's Facilities

21.1  The Employer may provide the Employee with access to certain facilities,
      including email and Internet services, computer systems, telephone
      services (mobile and landline), facsimile machines and photocopy
      facilities ("the Facilities").

21.2  The Facilities are provided for use in connection with the business of the
      Employer only. The Employee will reimburse the Employer for any costs
      incurred as a result of any use of the Facilities that is not related to
      the business of the Employer, including the following:

      o     personal calls on mobile phones;

      o     personal interstate or overseas phone calls;

      o     personal facsimile charges; and

      o     personal photocopy costs.

21.3  The use of the Facilities will be monitored by the Employer and the
      Employee consents to this monitoring. The Employee acknowledges that any
      personal messages received or sent on the Facilities will not be regarded
      as confidential.

21.4  The Employee must not use the Facilities to access, download, copy,
      circulate, send, receive, or otherwise communicate:

      o     hateful or abusive material;

      o     offensive material (including jokes or games);

      o     defamatory material;

      o     material which would offend anti-discrimination and/or harassment
            laws; or

      o     pornography.

      The Employee must also actively discourage anyone else from sending the
      Employee this type of material.

21.5  The Employee must not use the Facilities to infringe the copyright of
      others. For example, copying and distributing licensed software may be in
      breach of copyright and may expose the Employee and the Employer to legal
      action.

21.6  The Employee must not use unauthorised software on the Employer's computer
      or download software from the Internet.

21.7  The Employee must also comply with any policies distributed by the
      Employer regarding the use of the Facilities.

22    Termination Upon Prior Notice

22.1  Either Party may terminate the Employment by giving the other not less
      than 12 months' prior notice.

22.2  Where the Employee is required to work out a period of notice, the
      Employer may direct the Employee during some or all of the notice period:

      (a)   not to attend the office;

<PAGE>

      (b)   not to contact clients, customers, suppliers, employees or
            contractors of the Employer;

      (c)   not to perform the duties of the Position;

      (d)   to perform the duties of the Position from home;

      (e)   to assist the Employer to arrange a proper handover of the duties of
            the Position, including clients or customers and businesses; or

      (f)   any combination of the above,

      provided always that:

      (i)   this is done for the primary purpose of protecting the business of
            the Employer; and

      (ii)  the Employee continues to receive remuneration under this contract
            (or where this remuneration includes commission or bonuses) a
            reasonable assessment of the remuneration under this contract that
            the Employee would have received if this direction was not given.

22.3  If the Employee gives the Employer notice of termination for the purpose
      of commencing work with a competitor of the Employer, or otherwise
      competing with the Employer, the Employee must:

      (a)   immediately upon giving notice disclose full details of this purpose
            so as to enable the Employer to take steps to protect its business,
            and arrange the hand over of the Position's duties (including
            clients, suppliers and business) to another employee; and

      (b)   comply with any directions given by the Employer for the purpose of
            giving effect to (a) above.

      The obligation set out in this sub-clause above is not intended to detract
      from the Employee's general obligation to immediately disclose any
      conflict of interest to the Employer.

22.4  The Employer may also terminate the Employment by either:

      (a)   making a payment in lieu of the entire notice period; or

      (b)   requiring the Employee to work part of the notice period and making
            a payment in lieu of the balance of the notice period.

      In either case the Employment will be terminated upon the making of the
      payment in lieu of notice.

22.5  Subject to the following subclause, any payment in lieu of notice will be
      calculated by reference to the remuneration which the Employee would have
      earned under this contract if the Employee worked the Employee's normal
      hours throughout the notice period (or part thereof).

23    Summary Termination

23.1  The Employer may terminate the Employment at any time without prior notice
      if the Employee:

      (a)   is guilty of serious misconduct (including, but not limited to
            theft, fraud, and assault);

      (b)   is grossly negligent or otherwise incompetent in the performance of
            the duties of the Position;

<PAGE>

      (c)   commits a serious or persistent breach of the terms of this
            contract;

      (d)   refuses to carry out a lawful and reasonable instruction that is
            consistent with this contract;

      (e)   becomes bankrupt or suspends payment or compounds with or assigns
            the Employee's estate for the benefit of his creditors;

      (f)   commits a crime or other civil wrong, which in the reasonable
            opinion of the Employer, may seriously impact on the Employee's
            ability to perform the duties of the Position or is likely to
            significantly damage the reputation or business of the Employer; or

      (g)   is either repeatedly absent from work or absent from work for a
            period of five (5) consecutive days without proper explanation or
            the consent of the Employer.

23.2  The Employee may terminate the Employment without prior notice if the
      Employer commits a serious breach of this contract.

24    Appointment to and Resignation from Offices

24.1  The Employer may, during the Employment, request that the Employee hold
      offices with the Employer or a Related Body Corporate of the Employer.
      Unless otherwise agreed in writing, these offices will be held without any
      further remuneration to the Employee.

24.2  On termination of the Employment for any reason, the Employee must, at the
      request of the Employer, resign from any office (including the office of
      director) held by the Employee in the Employer or in any Related Body
      Corporate, without claim for compensation.

24.3  The Employee will not be entitled to a benefit under this contract or
      otherwise in connection with the termination of the Employment, if the
      giving of the benefit will give rise to a breach of Part 2D.2 of the
      Corporations Act 2001, any other provision of that Act, or any other
      applicable statute, rule or regulation that limits or restricts the giving
      of such benefits. Further, the Employer is under no obligation to seek or
      obtain the approval of its shareholders in general meeting for the purpose
      of overcoming any such limitation or restriction.

25    Suspension

25.1  If the Employer suspects that the Employee has been involved in any
      improper conduct or involved in any other conduct which in the reasonable
      opinion of the Employer requires proper investigation, the Employer may do
      the following for the purposes of conducting this investigation:

      (a)   suspend the Employee from any requirement to perform the duties and
            responsibilities of the Position for a period not exceeding two
            weeks;

      (b)   direct the Employee not to attend the workplace or contact fellow
            employees or any other party involved in the conduct which is being
            investigated;

      (c)   appoint any person to conduct the investigation; and

      (d)   direct the Employee to provide any assistance and answer any
            questions, required for the investigation.

25.2  During the period of suspension the Employee will continue to receive the
      remuneration set out under this agreement.

<PAGE>

25.3  Any suspension under this clause will not be treated as disciplinary
      action by the Employer, but will be instituted solely for the purpose of
      conducting an investigation.

26    Confidential Information and Insider Trading

26.1  "Confidential Information" means the following information which is
      obtained by the Employee during the course of or as a result of the
      Employment:

      (a)   information which is marked "Confidential" or which is described or
            treated by the Employer as confidential;

      (b)   information of a business sensitive nature;

      (c)   personal information as defined in the Privacy Act 1988 (Cth);

      (d)   trade secrets; and

      (e)   without limiting the generality of the above, the information which
            is listed in Schedule B of this Contract.

26.2  Confidential Information is not confined to information of the Employer,
      but may also include information of its Related Bodies Corporate, clients,
      suppliers, contractors and employees and information of the Employer's
      customers, contractors, suppliers, clients and their Related Bodies
      Corporate.

26.3  Confidential Information will not include information which is or becomes
      readily available in the public domain otherwise than as a result of the
      breach of an obligation of confidence by the Employee.

26.4  The Employee must not use or disclose Confidential Information during or
      after the Employment except in the following circumstances:

      (a)   the Employer has given its prior written consent; or

      (b)   in the proper course of performing the duties of the Position and
            for the benefit of the Employer; or

      (c)   to the extent required by law.

26.5  Without limiting generality of the above, the Employee must not disclose
      Confidential Information to other employees of the Employer unless these
      employees are authorised by the Employer to receive this information and
      need to know this information to perform their duties to the Employer.

26.6  The Employee must immediately notify the Employer if the Employee suspects
      that Confidential Information has been improperly used or disclosed.

26.7  The Employee must take all reasonable steps to prevent the unauthorised
      disclosure or use of Confidential Information.

26.8  The Employee must execute all confidentiality agreements with the Employer
      which are designed to protect Confidential Information which comes to the
      attention of the Employee as a result of the Employment, as reasonably
      required by the Employer from time to time.

26.9  The Employee must not copy or remove from the Employer's premises any
      Document which contains Confidential Information except for the purpose of
      properly performing the duties of the Position and for the benefit of the
      Employer.

<PAGE>

26.10 The Employee acknowledges that the Employee is likely to have access to
      material non-public information regarding the Employer or its Related
      Bodies Corporate and that insider trading restrictions may apply to the
      Employee as a result of obtaining such information. The Employee
      acknowledges and agrees that the Employee will comply with all legal
      obligations which the Employee has in relation to such restrictions in
      respect of such information.

27    Return of Property and Documents upon Termination

27.1  Upon the termination of the Employment, the Employee must immediately
      deliver to the Employer without any further demand:

      (a)   all Documents and other property of the Employer; and

      (b)   without limiting the generality of (a) above, all Documents which
            contain any Confidential Information, documents in the Employee's
            possession or control relating in any way to any Confidential
            Information.

28    Post-Employment Restrictions

28.1  The Employee will comply with the post-employment restrictions which are
      set out in Schedule C to this contract.

28.2  The Employment is conditional upon the Employee complying with the
      post-employment restrictions. The Employee acknowledges that the
      Employee's remuneration under this contract incorporates consideration for
      the post-employment restrictions.

28.3  The Employee acknowledges that during the Employment, the Employee has or
      will become possessed of Confidential Information regarding the business
      of the Employer and its Related Bodies Corporate, clients, customers and
      suppliers, and the disclosure or use of such information may materially
      harm the Employer or its Related Bodies Corporate. The Employee agrees
      that the post-employment restraints contained in Schedule C are reasonable
      and necessary for the protection of the business of the Employer and its
      Related Bodies Corporate.

29    Entire Agreement

This contract constitutes the entire agreement relating to the Employment on and
from 1 July 2005 and supersedes all prior agreements, contracts, negotiations
and representations whether in writing or oral in relation to the Employment
after 30 June 2005. This contract may only be amended by agreement in writing
signed by both parties. For the avoidance of doubt, this contract does not
constitute a guarantee of employment with the Employer for any period, including
up to 30 June 2005.

30    No Representations and Warranties

The Employee acknowledges that in entering into this contract, the Employee has
not relied on any representations or warranties about its subject matter, except
as provided in this contract.

31    Governing Law and Jurisdiction

The Employment is governed by the laws in force in New South Wales and both the
Employer and the Employee irrevocably submit to the non-exclusive jurisdiction
of the courts of New South Wales.

<PAGE>

32    Independent Legal Advice

32.1  The Employee acknowledges that the Employee has had a reasonable
      opportunity to obtain independent legal advice regarding the contents of
      this contract.

32.2  The Employee acknowledges that the Employee has had sufficient time to
      review the contents of this contract and further, understands the contents
      of this contract.

32.3  The Employee acknowledges that the Employee has not been placed under any
      undue pressure to enter into this contract.

<PAGE>

Signed for and on behalf of             )
Advanced Medical Institute Pty          )
Limited                                 )
by its sole director/Authorized Officer )

                                              /s/ Tony Khan
                                              ----------------------------------
                                              Signature of Authorized Officer

                                              Tony Khan
                                              ----------------------------------
                                              Name of Authorized Officer (please
                                              print)

Signed by                               )
Dr Jack Vaisman                         )
in the presence of:                     )

/s/ Dilip Shrestha                            /s/ Jack Vaisman
-------------------------------------         ----------------------------------
Signature of witness                          Signature of Dr Jack Vaisman

Dilip Shrestha
-------------------------------------
Name of witness (please print)

<PAGE>

Schedule A

Job Description
--------------------------------------------------------------------------------

As chief executive officer and managing director, the Employee will have
significant responsibility for the performance of the Employer and will exercise
all powers vested in him by the Employer from time to time.

Without limiting the generality of the foregoing, the Employee will be
responsible for oversight of the following:

      (a)   the strategic business operation and development of the Employer;

      (b)   monitoring the general non-strategic day to day business operations
            of the Employer (by supervising the performance of the Employer's
            chief operating officer and chief financial officer and the staff
            reporting to them);

      (c)   supervising the performance of the Employer's chief operating
            officer and chief financial officer;

      (d)   human resources including advertising, interviewing and engaging
            contractors (doctors and other service providers) and staff (sales,
            helpline, back office) for the operation of the business of the
            Employer;

      (e)   monitoring and reviewing staff and contractors;

      (f)   supervising and working with the chief financial officer with
            respect to his accounting, budgeting and information technology
            responsibilities;

      (g)   analysing the market, being involved in settling service rates and
            reviewing business performance;

      (h)   assisting with advertisement and call centre script preparation and
            review;

      (i)   preparing and reviewing business plans;

      (j)   engaging suppliers;

      (k)   assisting with premises and lease sourcing and review;

      (l)   compliance with legal obligations in respect of corporate governance
            and day to day business operations; and

      (m)   working closely with the Employer's contracted pharmacy, doctors,
            nurses, sales staff and call centre staff to ensure services are
            delivered to the highest standard and revenue and profit is
            maximised.

<PAGE>

Schedule B

Confidential Information
--------------------------------------------------------------------------------

      (a)   the names and addresses and other personal details of employees,
            contractors, clients and suppliers of the Employer or its Related
            Bodies Corporate (including without limitation doctors, nurses,
            sales staff, clinic staff, pharmacy contractors, medical equipment
            suppliers, pharmaceutical suppliers and information technology
            suppliers);

      (b)   the terms upon which the Employer or its Related Bodies Corporate
            contract with employees, contractors, clients and suppliers;

      (c)   financial results, business plans and forecasts of the Employer or
            its Related Bodies Corporate;

      (d)   the terms of this contract;

      (e)   know-how, trade secrets, ideas, concepts, technical and operational
            information, arising or used by the Employer or its Related Bodies
            Corporate in relation to their businesses including without
            limitation treatment methods and compositions, client databases and
            details, call centre scripts and direct sales scripts, outbound call
            scripts, treatment manuals and customer management software;

      (f)   information concerning the affairs or property of the Employer's
            business or the business of its Related Bodies Corporate or any
            business, property or transaction in which the Employer or its
            Related Bodies Corporate may be or may have been concerned or
            interested;

      (g)   information about the business methods of the Employer or its
            Related Bodies Corporate in the conduct of their businesses; and

      (h)   information which by its nature or by the circumstances of its
            disclosure, is or could reasonably be expected to be regarded as
            confidential to the Employer or any third party with whose consent
            or approval the Employer uses that information.

<PAGE>

Schedule C

Post-Employment Restrictions
--------------------------------------------------------------------------------

1.    For the purposes of this Schedule the following words have these meanings:

      "Customer" means any person who:

      (a)   is a customer of the Employer; or

      (b)   was a customer of the Employer within the Relevant Period; or

      (c)   was having discussions with the Employer at any time in the last
            three months of the Employment regarding becoming a customer.

      "Geographical Area" means New South Wales, Victoria, Queensland, Western
      Australia, South Australia, the Northern Territory, Tasmania, the
      Australian Capital Territory and any other place that the Employer or any
      of its Related Bodies Corporate was carrying on business at the
      Termination Date.

      "Relevant Period" means the last twelve months of the Employment up to and
      including the Termination Date, or if the period of the Employment was
      less than twelve months, that shorter period.

      "Restraint Period" means:

      (a)   a period of 2 years after the Termination Date; but if that period
            is held by a court of competent jurisdiction to be unenforceable,

      (b)   a period of 1 year after the Termination Date; but if that period is
            held by a court of competent jurisdiction to be unenforceable,

      (c)   a period of 6 months after the Termination Date; but if that period
            is held by a court of competent jurisdiction to be unenforceable,

      (d)   a period of 3 months after the Termination Date.

      "Restricted Business" means:

      (a)   the business of providing programmes for the treatment of impotence,
            premature ejaculation or sexual dysfunction in men and women; and

      (b)   any other business activity of a kind carried on in the Geographical
            Area by the Employer or a Related Body Corporate of the Employer in
            which the Employee was involved in the course of the Employment at
            any time during the Relevant Period.

      "Restricted Person" means any person:

      (a)   who is an employee, consultant or contractor of the Employer; or

      (b)   who was an employee, consultant or contractor of the Employer within
            the Relevant Period; or

      (c)   with whom the Employer was having discussions at any time in the
            last three months of the Employment regarding that person becoming
            an employee, consultant or contractor of the Employer.

      "Supplier" means any person who:

<PAGE>

      (a)   supplies the Employer or any of its Related Bodies Corporate with
            goods or services relating to Restricted Business including without
            limitation pharmaceutical services, pharmaceuticals, medical devices
            or equipment and medical services (including without limitation as a
            doctor or a nurse); or

      (b)   supplied the said goods or services to the Employer or any of its
            Related Bodies Corporate in the Relevant Period; or

      (c)   was having discussions with the Employer at any time in the last
            three months of the Employment regarding becoming a supplier of the
            said goods or services to the Employer.

      "Termination Date" means the date on which the Employment is terminated
      for any reason.

2.    A person will not constitute a Customer, Restricted Person, or Supplier as
      defined in clause 1 above unless the Employee either had material contact
      or dealings with that person in the course of the Employment, is likely to
      have developed a direct or indirect influence over that person as a result
      of the Employment, or had access to information regarding that person as a
      result of the Employment.

3.    The Employee will not at any time during the Restraint Period (without the
      Employer's prior written consent) directly or indirectly, on the
      Employee's own behalf or on behalf of any other person:

      (a)   in the Geographical Area participate in or be involved with the
            carrying on of Restricted Business;

      (b)   in the Geographical Area, in respect of Restricted Business, become
            employed by, or provide services to, or have any other business
            association with, a business carrying on Restricted Business,
            including but not limited to such a business in which any of Gary
            Aaron, Mark Ryan, Tim Kinsella, Graham Meehan and Ramsay Salis
            (which persons the Employee acknowledges are competitors of the
            Employer) or any person associated with any of them is participating
            or is involved;

      (c)   in the Geographical Area solicit Restricted Business from any
            Customer or Supplier;

      (d)   endeavour to entice a Customer or Supplier away from the Employer or
            otherwise interfere with the relationship which the Employer
            maintains or proposes to maintain with a Customer or Supplier;

      (e)   accept a request from a Customer to provide the Customer with
            services in the Geographical Area that would constitute Restricted
            Business;

      (f)   interfere with any transaction relating to Restricted Business in
            which the Employer is involved or proposes to be involved;

      (g)   attempt to entice away from the Employer any Restricted Person or
            otherwise interfere with the relationship which the Employer
            maintains or proposes to maintain with a Restricted Person;

      (h)   engage in any conduct which may tend to damage the business or
            business interests of the Employer; or

      (i)   counsel, procure or assist any person to do any of the acts referred
            to above.

4.    The restrictions imposed on the Employee under sub-clauses 3 (a) to (i)
      are separate and independent restrictions, apply concurrently, and are not
      intended to limit the operation, interpretation or severability of each
      other. Subject always to the operation of the Restraints of Trade Act 1976
      (NSW), each and every restriction in this Schedule will be taken to be a
      severable and independent restriction with the intent that, if they are,
      taken together, adjudged to go beyond what is reasonable in all the
      circumstances but would be adjudged reasonable with any one or more
      restrictions or parts of the restrictions deleted, the restrictions will
      be taken to apply as if those restrictions or parts of restrictions so
      adjudged unreasonable were deleted.

<PAGE>

5.    Nothing in this Schedule prevents the Employee from:

      (a)   being a holder for the purposes of investment only of a
            corporation's marketable securities quoted on a recognised stock
            exchange (providing the holding is limited to 5% or less of the
            corporation's issued capital); or

      (b)   reasonable involvement in any professional or educational activity
            or body.

6.    The Employee acknowledges that, if the Employee breaches clause 3 above,
      damages may not be a sufficient remedy and that the Employer will be
      entitled to claim injunctive and/or other equitable relief.

7.    The Employee acknowledges that the restrictions set out in this clause are
      reasonably necessary to protect the business of the Employer and its
      Related Bodies Corporate.EXHIBIT 10.1
                                                            OHIO Grant Agreement

                                    AGREEMENT

                                     BETWEEN

                                  STATE OF OHIO
                            DEPARTMENT OF DEVELOPMENT
                         COMMUNITY DEVELOPMENT DIVISION
                           OFFICE OF ENERGY EFFICIENCY
                    (hereinafter referred to as the GRANTOR)

                                       AND

                                  HydroGen Inc.
                               1801 Route 51 South
                            Jefferson Hills, PA 15025
                           FED. TAX I.D. #: 86-0965692
                    (hereinafter referred to as the GRANTEE)

                                       FOR

           SEP-Utilities/Power-Renewables-Advanced Energy Technologies

                          Beginning: September 1, 2005

                                       and

                              Ending: July 31, 2007

                               Grant Number: 06-05
                                 GRANT AGREEMENT
<PAGE>

      This Grant Agreement (the  "Agreement") is entered into by and between the
State of Ohio, Department of Development  (hereinafter  variously referred to as
the  "Grantor"),  located  at 77 South  High  Street,  Columbus,  Ohio 43215 and
HydroGen Inc., (hereinafter variously referred to as the "Grantee"),  located at
1801 Route 51 South,  Jefferson  Hills, PA 15025, for the purpose of undertaking
the project and activities as set forth in the "Scope of Work"  attached  hereto
and incorporated herein as Exhibit I (hereinafter  referred to as "the Project")
during the period September 1, 2005 through July 31, 2007.

Grantee Federal Tax ID No. 86-0965692                            Grant No. 06-05

                           STATEMENT OF THE AGREEMENT

In  consideration  of the mutual  promises and covenants  herein set forth,  the
parties hereto mutually agree that:

      1. Grant of Funds.  The State of Ohio,  Department of  Development  hereby
grants Federal funds in the amount of $1,250,000.00 for Grantee's performance of
the Project.

      2.  Compliance.  The Project shall be performed in accordance with any and
all applicable local, state, and federal statutes,  constitutions,  regulations,
directives,  guidelines,  approved  state plans,  or other  requirements  of the
Grantor in effect at the time of the execution of this  Agreement or thereafter.
The Grantee accepts full  responsibility for payment of any and all unemployment
compensation,  insurance premiums,  workers' compensation  premiums,  income tax
deductions,  social security deductions,  and any and all other taxes or payroll
deductions  required for all employees  engaged by Grantee in the performance of
the work and activities  authorized by this Agreement.  The Grantee accepts full
responsibility for providing workers with proper safety equipment and taking any
and all  necessary  precautions  to  guarantee  the safety of workers or persons
otherwise affected.

      3.  Management of Moneys.  The funds  granted  herein shall be paid to the
Grantee  on a  reimbursement  basis  and  are to be  requested  with  supporting
financial documentation as set forth in Exhibit II. The Grantee shall record all
moneys  received  under this  Agreement  in a separate  account on the books and
records of the Grantee.  All payments to the Grantee under this Agreement are to
be used solely for the  Project.  All  requests for payment must be completed on
forms B.1 and B.2,  with payment to be made in  accordance  with Exhibit II. The
Grantee  shall not pledge said  moneys as  security  for any loan or debt of any
kind. If said money is not so used, it shall be returned to the Grantor.  In the
event that the total amount of the grant exceeds the cost of the project  during
the term of this  Agreement,  the  remaining  moneys  shall be  returned  to the
Grantor  within  sixty  (60)  days  of the  expiration  or  termination  of this
Agreement.
<PAGE>

      4. Limitation on Expenditure of Funds.  Expenses charged against the funds
granted  herein shall not be incurred by the Grantee except during the period of
this Agreement as set forth above,  and may be incurred only as necessary in the
performance of the Project.  All expenses incurred or obligated for the approved
program  must be  supported  by  approved  signed  contracts,  purchase  orders,
requisitions,  bills,  or  other  evidence  of  liability  consistent  with  the
Grantee's established procurement procedures. The Grantee shall require delivery
before payment is made for purchased goods, equipment,  or services,  unless the
Grantee  obtains  reasonably  satisfactory  security from the vendor for payment
made. The Grantee and Grantor shall act in accordance  with the provisions of 10
CFR 600.134 in  relationship to the use and disposition of any and all equipment
purchased with the funds granted to the Grantee hereunder.

      5.  Reports,  Records and  Evaluations.  The Grantee  shall  submit to the
Grantor reports detailing the expenditures of the funds granted pursuant to this
Agreement and such other  reports as may be reasonably  required by the Grantor,
including  the reports  listed,  and  according to the  schedule  set forth,  in
Exhibit II, which is attached  hereto,  made a part hereof and  incorporated  by
reference herein as if fully set forth herein.  The Grantor shall evaluate,  and
provide guidance to the Grantee in preparing all required reports,  records, and
evaluations to be submitted under the terms of this Agreement. Grantee staff and
Board members shall cooperate with authorized  personnel of the Grantor in their
program  monitoring and shall maintain,  and make available all programmatic and
performance  records  necessary for said  monitoring  within a reasonable  time.
Failure to submit any one of the  reports  listed in Exhibit II,  submission  of
erroneous  information  in said  reports,  failure  to  maintain  any one of the
records  listed in  Exhibit  II, or  failure to  correct  any  discrepancies  or
weaknesses  identified by the Grantor as a result of  examination of any reports
or records,  which continues for a period of thirty (30) days following  written
notice of such failure,  may be considered  grounds for  suspension of financial
assistance  and  termination  of  this  Agreement.   Using  generally   accepted
accounting  principles,  the  Grantee  shall  prepare  and  retain any books and
records  necessary to ensure  compliance  with the terms and  conditions of this
Agreement as set forth in Exhibit II.

      6.  Auditing  Standards.  The  Grantee  acknowledges  that this  Agreement
involves the use of federal  funds and as such is subject to audit by the agency
of the United States  government  granting  funds to the Grantor for purposes of
performing the Project. As directed by the Grantor,  the Project will be subject
to fiscal and compliance  audits in accordance with Generally  Accepted Auditing
Standards as  promulgated by OMB Circulars  A-110,  A-128,  or A-133  (whichever
applicable),  United States General  Accounting  Office Guidelines for Financial
and Compliance Audits of Federally Assisted Programs.

      7. Rights of  Inspection.  The Grantee shall permit the Grantor and/or its
agents,  including  but not  limited to the  Auditor of the State of Ohio,  upon
reasonable  notice from Grantor,  to inspect,  during normal business hours, any
books and records  necessary to ensure  compliance with the terms and conditions
of this Agreement as set forth in Exhibit II. Any such information determined to
be Trade Secrets  pursuant to ORC Section 1333.61 will be held as  confidential.
The Grantee warrants by executing this Agreement its  understanding  that rights
of inspection (i) extend to agents of the Grantor's  federal  agency,  including
but not limited to the Inspector  General's  Office,  the Government  Accounting
Office,  and the  Comptroller  General;  (ii)  include the rights to examine the
Grantee's corporate accounts or other accounts and/or funding sources within the

<PAGE>

control  and/or name of the  Grantee  when there is  evidence  (e.g.,  vouchers,
invoices, canceled checks, descriptions, etc.) that these books contain original
or substantial  source  documentation  of the federal funds granted herein;  and
(iii) contain the Grantee's  covenant to make all fiscal  records  available for
inspection  to  authorized  audit  personnel  of the  Grantor  and  its  federal
agencies.  The Grantee shall further  permit the Grantor to perform  monitoring,
evaluation,  and audit  activities  as  determined  to be  necessary in the sole
reasonable discretion of the Grantor.

      8. Maintenance of Records. All required records as set forth in Exhibit II
shall be maintained by the Grantee for a period of three (3) years from the date
the final report is submitted,  except in cases where unresolved audit questions
may require  retention  of some or all of said  records  for a longer  period as
determined by Grantor.

      9.  Federal  Assurances,  Certifications,  and  Property  Provisions.  The
Grantee shall review and complete the documents  attached  hereto in Exhibit III
in accordance with any and all instructions  contained within such documents and
shall  comply  with any  laws,  directives,  guidelines,  or other  requirements
described therein.

      10.  Instructions  from Grantor.  The Grantor may, from time to time as it
deems appropriate and necessary,  communicate specific instructions and requests
to the  Grantee  concerning  the  performance  of the  work  described  in  this
Agreement.  Upon such notice and within a  reasonable  time,  the Grantee  shall
comply with such  instructions  and  fulfill  such  requests  to the  reasonable
satisfaction  of the Grantor,  which  instructions  shall be consistent with the
terms and purposes of this Agreement.  It is expressly understood by the parties
that these  instructions and requests are for the sole purpose of performing the
specific  tasks  requested  to ensure the  satisfactory  completion  of the work
described  in this  Agreement  and are not  intended  to  amend  or  alter  this
Agreement or any part thereof.

      11.  Covenant  Against  Contingency  Fees.  The Grantee  covenants that no
person or selling agency or other  organization has been employed or retained to
solicit or secure  this  Agreement  upon an  agreement  or  understanding  for a
commission, percentage, brokerage, or contingent fee. For breach or violation of
this covenant the Grantor shall have the right to rescind this Agreement without
liability  or, in its  discretion,  to deduct from the  Agreement  or  otherwise
recover the full amount of such commission, percentage, brokerage, or contingent
fee, or to seek such other remedies as may be legally available.

      12.  Termination.  The Grantor may terminate  this Agreement in any one of
the following instances:

      (i)   the  Grantor  determines  that the  governing  board of the  Grantee
            cannot or will not take the  necessary  action to bring the  Grantee
            into compliance with applicable  requirements of 10 C.F.R. 600, with
            the requirements of any applicable  program statute or rule, or with
            any  other  term or  condition  of this  Agreement  within  the time
            allowed by the Grantor;

      (ii)  the  Grantee  ceases  to  exist  or  becomes  legally  incapable  of
            performing its responsibilities under this Agreement; or
<PAGE>

      (iii) the Grantee  fails to comply with any  provision  of this  Agreement
            which failure  continues  following the expiration of any applicable
            cure period.

      (a) Notice of Termination.  The Grantor shall provide written notification
      of  intent  to  terminate  to the  governing  board  of the  Grantee.  The
      notification shall include the charges for such proposed action,  sections
      of the statutes,  rules,  regulations or contractual  obligations that the
      Grantee is charged with violating,  and a statement of the Grantee's right
      to  request  a public  hearing  on the  proposed  termination  by making a
      written  request  within thirty days of the date of receipt of the notice.
      The  notice  shall  also  inform  the  Grantee  that  the  Grantee  may be
      represented by an attorney or by such other  representative  as designated
      by a majority of the governing board of the Grantee.

      (b) Failure of Notice Process. When any notice of intent to terminate sent
      by certified mail is returned because of inability to deliver,  the notice
      required  shall be sent by ordinary  mail  evidenced by a  certificate  of
      mailing to the chairperson of the Grantee.

      (c)  Partial  Termination.  The  Grantor  and the  Grantee  may agree to a
      partial termination of this Agreement,  in which event the Grantor and the
      Grantee  shall,  in writing,  specify the nature and extent of the partial
      termination.

      13. Force Majeure.  Neither party hereto shall be considered in default in
the  performance  of its  obligations  hereunder,  or be  liable in  damages  or
otherwise  except as expressly  set forth in this  Agreement  for any failure or
delay in performance which is due to strike,  lockout,  concerted act of workers
or other  industrial  disturbance,  riot or armed conflict  whether  declared or
undeclared,  curtailment, shortage, rationing or allocation of normal sources of
supply of labor, materials, transportation,  energy, or utilities, accident, Act
of God, delay of Grantee's subcontractors or vendors, sufferance of or voluntary
compliance  with acts of government and government  regulations  (whether or not
valid),  embargo,  machinery or equipment  breakdown,  or due to any other cause
whether similar or dissimilar to any of the causes or categories of causes above
and  which is  beyond  the  reasonable  control  of the  party  claiming  excuse
hereunder.

      14. Effects of Termination. In the event of termination,  all property and
finished  or  unfinished  documents,  data,  studies and  reports  purchased  or
prepared by the Grantee under this  Agreement  shall be disposed of according to
Grantor  directives,  and the Grantee shall be entitled to compensation  for any
unreimbursed  expenses  reasonably and necessarily  incurred in the satisfactory
performance  of  this  Agreement  at  any  time  up to  the  effective  date  of
termination  (notwithstanding  that  a  request  for  reimbursement  may  not be
submitted until following such  termination  date).  [The Grantee shall incur no
new obligations after the notice of the termination of this Agreement, and shall
cancel  as many  outstanding  obligations  as  possible,  it  being  understood,
however, that this sentence shall apply solely to obligations being funded by or
through Grantor.] In the case of a partial termination,  the Grantee shall incur
no  obligations  other  than  those  specifically  identified  in  the  contract
governing the partial termination. Notwithstanding any of the provisions of this
section,  the Grantee  shall not be relieved of its  responsibility  for damages
<PAGE>

sustained by the Grantor by virtue of any breach of contract by the Grantee, and
the Grantor may  withhold  any  reimbursement  to the Grantee for the purpose of
set-off  until such time as the exact amount of damages due the Grantor from the
Grantee is agreed upon or otherwise determined.

      15. Request to Terminate by Grantee. Notwithstanding any of the provisions
of this  section,  if the  Grantee is unable or  unwilling  to comply  with such
additional conditions as may be lawfully applied by the Grantor, the Grantee may
request to terminate this Agreement by giving  reasonable  written notice to the
Grantor,  signifying the effective date thereof,  the reasons for requesting the
termination,  and an appropriate  budget  revision.  In such event,  the Grantor
shall  terminate the Agreement only if both parties agree to the termination and
to the conditions under which it shall occur.

      16.  Equal  Employment  Opportunity.  The  Grantee  will not  discriminate
against any  employee or applicant  for  employment  because of race,  religion,
color, sex, national origin, handicap, or age. The Grantee will take affirmative
action to ensure the  employment of qualified  applicants  without regard to the
race,  religion,   color,  sex,  national  origin,  handicap,  or  age  of  such
applicants.  Such action shall  include,  but not be limited to, the  following:
Employment,  Upgrading,  Demotion,  Termination,  Rates of Pay or other Forms of
Compensation, and Selection for Training, including Apprenticeship.  The Grantee
agrees to post in conspicuous places,  available to employees and applicants for
employment,  notices  setting forth the  provisions  of this  non-discrimination
clause.  The Grantee will, in all solicitations or advertisements for employment
positions,  expressly  indicate that  applications  placed for  consideration of
employment will be reviewed without regard to the race,  religion,  color,  sex,
national origin, handicap, or age of the applicant. The Grantee will incorporate
the  foregoing  requirements  of this section in all of its contracts for any of
the work  described  herein and will require all of its  subcontractors  for any
part of such work to incorporate such  requirements in all subcontracts for such
work.

      17. Age  Discrimination.  Any prohibition  against  discrimination  on the
basis of age  under the Age  Discrimination  Act of 1975 or with  respect  to an
otherwise  qualified  handicapped  individual  as provided in Section 504 of the
Rehabilitation Act of 1973 shall also apply to any program or activity funded in
whole or in part with funds made available under this Agreement.

      18.  Indemnification.  The  Grantee  agrees to  indemnify  and to hold the
Grantor and State of Ohio harmless and immune from any and all claims for injury
or  damages  arising  from  this  Agreement  and  Grantee's  performance  of the
obligations or activities in  furtherance of the Project which are  attributable
to the Grantee's  own actions or omissions or those of its  trustees,  officers,
employees, subcontractors,  suppliers, third parties utilized by the Grantee, or
joint venturers  while acting under this  Agreement.  Such claims shall include,
but are not limited to, any claims  made under the Fair Labor  Standards  Act or
under any other federal or state law involving  wages,  overtime,  or employment
matters  and any claims  involving  patents,  copyrights,  and  trademarks.  The
Grantee shall bear all costs associated with defending the Grantor and the State
of Ohio against any claims.
<PAGE>

      19. Conflict of Interest.  No personnel of Grantee,  any  subcontractor of
Grantee or public official,  who exercises any functions or  responsibilities in
connection  with the  review  or  approval  of the  work  completed  under  this
Agreement  shall,  prior  to  the  completion  of  said  work,   voluntarily  or
involuntarily  acquire  any  personal  interest,  direct or  indirect,  which is
incompatible  or in conflict with the discharge or  fulfillment of his functions
or  responsibilities  with respect to the  completion  of the work  contemplated
under this  Agreement.  Any such person who,  prior to or after the execution of
this Agreement,  acquires any personal  interest,  involuntarily or voluntarily,
shall immediately  disclose his interest to Grantor in writing.  Thereafter,  he
shall not  participate  in any action  affecting  the work under this  Agreement
unless Grantor determines that, in light of the personal interest disclosed, his
participation in any such action would not be contrary to the public interest.

      20.  Certification  of Funds.  None of the rights,  duties and obligations
described in this Agreement shall be binding on either party until all statutory
provisions  of the Ohio  Revised  Code,  including  but not  limited  to Section
126.07,  have been complied with and until such time as all necessary  funds are
made available and forthcoming from the appropriate state or federal agencies.

      21. Miscellaneous.

      a).  Governing  Law. This  Agreement  shall be governed by the laws of the
State  of Ohio as to all  matters,  including  but not  limited  to  matters  of
validity, construction, effect and performance.

      b). Forum and Venue. All actions regarding this Agreement shall be forumed
and venued in a court of  competent  subject  matter  jurisdiction  in  Franklin
County, Ohio.

      c). Entire  Agreement.  This  Agreement and its exhibits and any documents
referred to herein  constitute  the  complete  understanding  of the parties and
merge  and   supersede   any  and  all   other   discussions,   agreements   and
understandings,  either oral or written, between the parties with respect to the
subject matter hereof.

      d).  Severability.  Whenever  possible,  each  provision of this Agreement
shall  be  interpreted  in  such  manner  as to be  effective  and  valid  under
applicable  law, but if any provision of this Agreement is held to be prohibited
by or invalid under  applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of such provisions of this Agreement.

      e). Waiver.  Terms,  conditions,  or  requirements of the Agreement may be
waived only upon the express  written  consent of the Grantor as allowed by law.
No act or  forbearance  or failure to insist on the  prompt  performance  by the
Grantee of its  obligations  under this  Agreement,  either  express or implied,
shall be construed as a waiver by the Grantor of any of its rights  hereunder or
at law.
<PAGE>

      f).  Notices.  All  notices,   consents,   demands,   requests  and  other
communications  which  may or are  required  to be given  hereunder  shall be in
writing and shall be deemed duly given if personally delivered or sent by United
States mail,  prepaid,  to the  addresses  set forth  hereunder or to such other
address as the other party hereto may designate in written notice transmitted in
accordance with the provision.

                  1.) In case of the Grantor to:

                           Ohio Department of Development
                           Office of Energy Efficiency
                           P. O. Box 1001
                           Columbus, Ohio 43216-1001
                           Attention: William Manz
                           (614) 466-6797

                  2.) In case of the Grantee to:

                           HydroGen Inc.
                           1801 Route 51 South
                           Jefferson Hills, PA  15025
                           Attention:  Joshua Tosteson
                           (412)405-1000

      g). Amendments or  Modifications.  Either party may at any time during the
term of  this  Agreement  request  amendments  or  modifications.  Requests  for
amendment  or  modification  of this  Agreement  shall be in  writing  and shall
specify the requested changes and the justification of such changes. The parties
shall review the request for  modification in terms of the regulations and goals
relating to the  Project.  Should the  parties  consent to  modification  of the
Agreement,  then an amendment shall be drawn, approved, and executed in the same
manner as the original Agreement.

      h). Pronouns. The use of any gender pronoun shall be deemed to include all
the other  genders,  and the use of any singular noun or verb shall be deemed to
include the plural, and vice versa, whenever the context so requires.

      i). Headings.  Section  headings  contained in this Agreement are inserted
for convenience only and shall not be deemed to be a part of this Agreement.

      j).  Assignment.  Neither  this  Agreement  nor  any  rights,  duties,  or
obligations  described  herein shall be assigned or subcontracted by the Grantee
without the prior  express  written  consent of the Grantor,  which shall not be
unreasonably withheld.

      k). Travel Expenses.  If contemplated  under this Agreement,  the Grantee,
its employees or agents, shall be reimbursed for travel expenses pursuant to the
requirements listed in Ohio Administrative Code Section 126-1-02.
<PAGE>

      l). Outstanding  Liabilities.  The Grantee affirmatively covenants that it
does not owe: (1) any  delinquent  taxes to the State of Ohio (the "State") or a
political  subdivision  of the  State;  (2) any  monies  to the State or a state
agency for the  administration or enforcement of any  environmental  laws of the
State;  and (3) any other  moneys to the State,  a state  agency or a  political
subdivision  of the State that are past due,  whether the amounts owed are being
contested in a court of law or not.

      m). Falsification of Information. The Grantee affirmatively covenants that
it has made no false  statements to the Grantor in the process of obtaining this
grant of funds.  If the  Grantee has  knowingly  made a false  statement  to the
Grantor to obtain this grant of funds,  the Grantee  shall be required to return
all funds immediately pursuant to Ohio Revised Code Section 9.66(C)(2) and shall
be ineligible for any future economic development assistance from the State, any
state agency or a political  subdivision  pursuant to O.R.C. Section 9.66(C)(1).
Any  person  who  provides  a false  statement  to secure  economic  development
assistance  may be guilty of  falsification,  a misdemeanor of the first degree,
pursuant to O.R.C. Section  2921.13(D)(1),  which is punishable by a fine of not
more than $1,000.00 and/or a term of imprisonment of not more than six months.

      n).  Successor In Interest.  Each and all of the terms and  conditions  of
this  Agreement  shall  extend to and bind and inure to the  benefit of not only
Grantee, but to its successors and permitted assigns.

      IN WITNESS WHEREOF,  the parties hereto have executed this Grant Agreement
as of the day and year set forth below.

GRANTEE:                                        GRANTOR:

HydroGen Inc.                                   State of Ohio
                                                Department of Development

                                                By:  /S/ Bruce Johnson
                                                     ---------------------------
By: /S/Joshua Tosteson                               Lt. Governor Bruce Johnson
    ----------------------                           Director of Development
    Joshua Tosteson,
    President

                                                Date:  8/26/05
Date: 8/26/05

Attachments:
       Exhibit I   -  Proposal
       Exhibit II  -  Reporting Requirements
       Exhibit III -  Federal Assurances, Certifications and Property Provisions

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