Document:

EXHIBIT 4.11

                    THIS AGREEMENT is made as of 10 May 2006

                 concerning Eurotrust A/S' subscription for and
                     purchase of the new emission of shares
                                       in
                         European wind energy farms A/S
                                  Diplomvej 377
                               DK-2800 Kgs. Lyngby

                        (hereinafter referred to as "EWP)

                                     between

                                  Eurotrust A/S
                                    Kokholm 3
                                 DK-6000 Kolding
                        (hereinafter referred to as "ET"
                                        &
                           European Energy Systems A/S
                               Peter Rordamsvej 30
                               DK-2800 Kgs. Lyngby
                       (hereinafter referred to as "EES")
                                        &
                             Mikael Dystrup Pedersen
                                Vandstjernevej 36
                                  DK-4600 Koge
                       (hereinafter referred to as "MDP")
                                        &
                               Knud Erik Andersen
                               Peter Rordamsvej 30
                               DK-2800 Kgs. Lyngby
                       (hereinafter referred to as "KEA")
                                        &
                         European wind energy farms A/S
                                  Diplomvej 377
                               DK-2800 Kgs. Lyngby
                        (hereinafter referred to as "EWF"

RECITALS

WHEREAS EES is the owner of 100% of the share capital in EWF; AND

WHEREAS ET and EES (hereinafter referred to as the "Shareholders") are desirous
of jointly carrying on a development company aiming at developing wind energy
farms, and WHEREAS to achieve this objective, the Parties agree by this
Agreement that ET shall acquire a 50.25% of the share capital in EWF including
all of its subsidiaries as specified in detail below. This ownership of shares
shall be acquired by increasing the capital in EWF in consideration of ET's
subscription in cash for shares in EWF, partly by ET's purchase of shares in EWF
from EES (by non-cash contribution of a portion of EES' EWF shares in ET). NOW,
THEEFORE EES, ET, EWF, MDP

<PAGE>

and KEA have entered into the following Agreement. The purpose of the Agreement
is to secure that EWF through the new joint ownership efficiently and quickly
can further develop the already existing project portfolio of wind energy farms
located in a range of countries. EWF will continue carrying on the activities,
EWF has previously carried on, i.e.

    o   Purchasing the right to land and entering into land lease agreements

    o   Exercising due diligence into projects offered

    o   Entering into development agreements with local wind energy farm
        development companies

    o   Making wind measurements and wind analyses

    o   Making assessments of noise levels and shade effect

    o   Obtaining building permits for the construction of wind energy farms

    o   Securing the required rights by registration of title to roads, rights
        to land for wind energy farm and cable passages/ducts to public
        electricity supply network.

    o   Building of wind energy farm infrastructure, i.e. wind energy farm
        foundations, roads and connections to public electricity supply network

    o   Entering into purchase agreements with wind turbine suppliers

    o   Entering into service agreements with service providers

    o   Taking out insurances for the individual wind turbines and
        infrastructure constructions

    o   Entering  into  agreements   concerning  technical  monitoring  of  wind
        turbines in commercial operation

    o   Procuring first priority project financing

After commissioning and obtaining a first priority financing, EWF will transfer
the wind energy farm to the Shareholders with 50 % to each of the Shareholders.

Upon the transfer of a wind energy farm, EWF obtains development remuneration
from the Shareholders amounting to minimum 4% of the cost price of the
respective wind energy farm, unless otherwise agreed. Each of the Shareholders
shall pay a 50% portion of the remuneration, unless the wind energy farm is
taken over by the Shareholders subject to a different percentage; if so the
development remuneration shall be paid by the Shareholders according to such
other percentage. Basically, EWF does not own any (commissioned) wind turbines
in commercial operation.

The basic principle for EWF is that the day-to-day management in EWF makes the
decisions and that the Shareholders shall agree on material investments,
strategic decisions and organisational changes.

EWF & EES ADJUSTING TO THE CAPITAL INCREASE IN EWF

Prior to the capital increase and ET's purchase of shares in EWF, the following
adjustments shall be made in EWF and EES:

    1.  All of the wind turbines that have been commissioned/are in commercial
        operation as of 01.05.2006 and are owned by EWF shall be transferred to
        EES. The transfer shall take place by the individual project companies
        including project rights and wind turbines in commercial operation being
        transferred to EES. A list of the companies transferred is contained in
        Appendix 1 (Transfers from EWF to EES).

    2.  All of the wind energy farm projects to which EES has the project rights
        concerning the construction of the wind turbine and where the wind
        turbine is not in commercial operation

<PAGE>

        as of 01.05.2006 shall be transferred to EWF. This applies to EES'
        shares in the following companies:

            a)  Enerteq ApS (50%)

            b)  VMA France SAS (40%)

            c)  A range of German KG's containing project rights to German wind
                turbines not yet in commercial operation.

        A list of the companies transferred is contained in Appendix 2
        (Transfers from EES to EWF). The transfer value of the individual
        development projects and companies (the transfers are set forth under
        Clauses 1 and 2) consists of the book cost price of the projects and
        companies, respectively.

    3.  The payment of the transfers set forth under Clauses 1 and 2 - and
        subject to transfer at the book cost price - shall be fully effected via
        the existing account between EES and EWF. This account between the
        Parties shall be settled not later than by 15 July 2006.

    4.  EES' shares in the company Enerteq Vitalba ApS (consisting of 85% of the
        ownership in the wind energy farm Parco Eolico Vitalba Srl consisting of
        7 Vestas V52 wind turbines, which are in the progress of construction),
        shall remain the property of EES'.

    5.  EES' shares in European wind energy farms no. 1 A/S shall remain EES'
        property, though.

    6.  The share capital in EWF shall be increased from DKK 500,000 to DKK
        4,111,200. The capital increase shall be carried into effect as a
        capitalisation issue.

    7.  Extraordinary dividend shall be paid from EWF to EES until the equity
        capital in EWF amounts to minimum DKK 4,111,200 as of 01.05.2006
        (certain reserves cannot be distributed). In calculating the equity
        capital, no goodwill or internal remuneration for uncompleted projects
        shall be paid.

    8.  MDP and KEA shall enter into contracts of employment with EWF.

Having completed Clauses from 1 to 8, EWF contains all of EWF's and EES'
previous project rights to wind energy farm projects, which are not in
commercial operation as of 01.05.2006 (with the exception of the Vitalby Project
(shares in Enerteq Vitalba ApS) which is in the progress of construction, and
the shares in European wind energy farms no. 1 A/S, both these projects shall
remain the property of EES). A complete list of the "new" EWF's wind energy farm
projects and companies is contained in Appendix 3. In addition, the company
holds a share capital of DKK 4,111,200 and an equity capital of minimum the same
size.

The company has a staff of 7 persons at the company's premises in Kgs. Lyngby,
Denmark.

CAPITAL INCREASE IN EWF

    9.  Prior to the capital increase, EWF has a share capital of DKK 4,111,200,
        which is wholly owned by EES.

    10. ET subscribes for a new emission of shares in EWF at a nominal amount of
        DKK 1,918,600 at DKK 6,254.56 per share at DKK 100, which is equal to a
        price of 6,254.56. The proceeds from the subscription amounts to approx.
        DKK 120,000,000.

    11. After this transaction, EWF holds a share capital of DKK 6,029,800.

    12. After deciding the capital increase set forth under Clause 10, ET
        purchases from EWF nominal DKK 1,111,400 shares in EWF from EES at DKK
        70,625,500 (which is equal to a price of 6,354.64), which is paid by
        issuing 915,500 shares in ET to EES. The purchase is effected by a
        non-cash contribution of the aforesaid EWF shares in ET. ET shall take
        care

<PAGE>

        that the said shares in ET as soon as possible will become negotiable
        instruments listed at NASDAQ and shall pay all costs in that connection.

    13. After registration with the Danish Commerce and Companies Agency of the
        capital increase in EWS (by subscription for new shares for payment in
        cash of approx. DKK 120,000,000) and final carrying into effect thereof
        (including securing that EES is registered as the owner of the said ET
        shares including any restrictions or third party rights of whatsoever
        nature, causing that the shares cannot be freely transferred for the
        payment of the full proceeds to EES, but see below concerning the
        release of shares) of ET's purchase of shares in EWF from EES (by
        non-cash contribution of the EWF shares in ET), ET shall be registered
        as the owner of the shares in question in EWF's register of
        shareholders.

    14. The capital increase and the purchase of shares are set forth in tabular
        form in Appendix 4. After carrying the capital increase and the purchase
        of shares into effect, the share capital in EWF will amount to nominal
        DKK 6,029,800 distributed on nominal DKK 3,030,000 (50.25%) to ET and
        nominal DKK 2,999,800 (49.75%) to EES. Release of shares to EES

    15. 375,000 ET shares as set forth under Clause 12, which are issued to EES,
        shall be transferred in connection with delivering the shares placed in
        escrow no. 5470ZZZZ in Forstaedernes bank. The escrow shall be opened in
        EES' name.

    16. Release of such shares placed in escrow to EES shall be subject to the
        following rules:

            a)  Once the 3 conditions (see below under Clause 17) have been
                complied with for projects amounting to a total project price of
                DKK 1.5 billion since 01 May 2006, EES shall have 125,000 ET
                shares released from the escrow as set forth under Clause 15.

            b)  Once the 3 conditions (see below under Clause 17) have been
                complied with for projects amounting to a total project price of
                DKK 2.5 billion since 01 May 2006 (i.e. projects amounting to
                total DKK 1.0 billion more than the project price as set forth
                under Sub Clause a), EES shall have another 125,000 ET shares
                released from the escrow deposit as set forth under Clause 15.

            c)  Once the 3 conditions (see below under Clause 17) have been
                complied with for projects amounting to total DKK 4.0 billion
                since 01 May 2006 (i.e. projects amounting to total DKK 2.5
                billion more than the project price as set forth under Sub
                Clause a), EES shall have the remaining 125,000 ET shares, which
                are placed in escrow, released as set forth under Clause 15.

        All rights conferred on the shares placed in escrow, including
        dividends, subscription rights, etc. shall pass to EES and shall be
        released simultaneously and in proportion to the release of the shares.

THE 3 CONDITIONS

    17. In order for the project to be approved according to Clause 16, the
        project shall be put on the project list and be in conformance with the
        following 3 conditions:

            a)  A building permit should have been granted for the project for
                the planned type of wind turbine and the building permit must
                have legal effect, i.e. any complaints must have been rejected
                or must be void.

            b)  The project should be a Party to a sales agreement entered into
                with a local utility company or a electricity distribution
                company for the sale of electricity.
<PAGE>

            c)  A purchase agreement should have been entered into with a wind
                turbine supplier stating the time of delivery and price. The
                purchase agreement should comply with the requirements of the
                building permit.

TAKING OVER PROJECTS OF THE PROJECT LIST AND THE ADMINISTRATION THEREOF

    18. Putting project onto the project list of projects takes place according
        to the following guidelines:

            a)  The management in EWF presents a new project including relevant
                information (see Info Catalogue in Appendix 5) for the
                management in ET and EES. Following this, ET and EES have one 1
                week within which to accept the project on the project list or
                not to accept the project on the project list.

            b)  If either ET or EES does not wish to exercise its right to
                acquire a developed "turnkey project" in proportion to their
                shareholding in EWF, the Party exercising its right shall have
                the option to acquire the shareholding of the Party who does not
                wish to exercise its right. The Party, which thereby acquires
                more of a project than the Party's shares entitle the Party to
                acquire, shall pay remuneration to the other shareholder. The
                remuneration shall be fixed from project to project. If the
                Party exercising its right does not wish to take over the shares
                of the Party, which does not wish to exercise its right, the
                Party which does not exercise its right shall be under an
                obligation to take over its proportionate portion of the shares
                in the project.

    19. The administration of the project list, showing the state of affairs of
        the individual projects, shall be performed by EWF. EWF shall also make
        quarterly statements concerning the number of projects conforming to the
        3 conditions.

    20. If ET and EES - via EWF - should choose to sell a wind energy farm
        project to a co-operation partner or to any third party, the project
        sold for this reason shall remain being included in EWF's project price
        as listed on the project list.

ORGANISATION OF EWF

    21. The structure of and staff of EWF shall remain unchanged and EWF shall
        continue carrying on its business as an independent company with ET and
        EES as shareholders.

    22. The activities in EWF consist in searching new wind energy farm projects
        and bringing such projects into being in conformity with the 3
        conditions, i.e. obtaining building permit, entering into sales
        agreement for the sale of electricity and entering into agreements for
        the purpose of purchasing wind energy farms. For the purpose hereof, the
        company has a basis organisation in Lyngby, Denmark, which handles the
        said activities in a close working relationship with co-operation
        partners in the individual countries, where wind energy farm projects
        are purchased and developed. The basis organisation is comprised of 10
        persons: 3 project executives, 2 project workers, 2 attorneys, 1 CFO and
        1 person responsible for technical/technological aspects and 1 manager
        responsible for the day-to-day business of the company. The project
        executives are responsible for the various language areas. By means of
        the 2 attorneys, the majority of the due diligence of the individual
        projects is done as in-house activities. Moreover, the majority of the
        co-operation agreements concerning development partners is done as
        in-house activities too. As regards the 7 persons, who are employed as
        of 01.05.2006, there are 3 newly employed persons among them: A project
        executive for Italy, a German attorney and a CFO.
<PAGE>

MANAGEMENT OF EWF AND ITS SUBSIDIARIES

    23. The board of directors of EWF and its subsidiaries is comprised of two
        members appointed by ET and two members appointed by EES. The chairman
        is appointed by ET.

    24. The management of EWF and its subsidiaries is comprised of KEA.

    25. The power to bind the company shall be construed so that EWF can alone
        be bound by the joint signatures of one person affiliated to EES and one
        person affiliated to ET.

TERMS OF EMPLOYMENT RELATING TO THE EMPLOYEES OF EWF

    26. MDP and KEA shall be employed by EWF subject to the same terms as the
        other employees having similar responsibilities in ET and EES.
        Furthermore, the contracts of employment shall contain the following
        provisions.

    27. MDP's and KEA's terminations shall be treated according to the following
        model:

            a)  If either KEA or MDP should choose to terminate their post in
                EWF, 80% (KEA) and 20% (MDP), respectively, of the ET shares,
                which at the time of termination are still in escrow, cf. Clause
                15, be returned to ET as a reduction of the purchase sum
                according to Clause 12.

            b)  EWF can alone terminate MDP or KEA in case of material breach by
                MDP or KEA of the employment terms and in case EWF, MDP or KEA
                has suffered considerable financial losses by this breach and -
                in order for the breach to be deemed material - a prior written
                notice stating unambiguously the specific employment term of
                which the employee has been in breach shall be served upon the
                Party in breach. If the breach remains unremedied or
                discontinued by KEA or MDP 30 days after the service of written
                notice upon KEA or MDP or if this is not possible, then KEA or
                MDP shall pay compensation to EWF to the extent of any damage
                EWF might have suffered. If the Party in breach accepts having
                committed breach, the remaining part of this Sub Clause b. shall
                apply. If the breach is not discontinued or if compensation is
                not paid, the contract of employment shall be deem terminated at
                the expiry of the said period of 30 days. That either MDP or KEA
                shall be terminated as said forth under this Sub Clause causes
                that the shares, which at the time of termination are still
                placed in escrow, cf. Clause 15, shall be released to ET as set
                forth above with 80% (KEA's notice of termination) or 20% (MDP's
                notice of termination).

            c)  If the breach cannot be accepted and the dispute concerning the
                notice of termination cannot be settled amicably and therefore
                results in a judgment, the co-operation between EES and ET shall
                terminate. The losing Party (i.e. EES if EWF is the prevailing
                Party and ET if EWF is the losing Party) shall within 30 days
                after a final judgment has been delivered advance an offer to
                purchase the prevailing Party's shares in EWF. After that, the
                prevailing Party has 30 days to either accept the losing Party's
                offer or itself purchase the losing Party's shares in EWF at the
                same price.

            d)  MDP and KEA are subject to a con-competition clause and cannot
                develop wind energy farms in EWF framework (under the auspices
                of EWF).

            e)  The terms of the other employees' employments shall remain
                unchanged.

FINANCING OF PROJECT

    28. EWF shall finance all of the development activities in EWF and its
        subsidiaries. This includes, e.g., the financing of development
        activities, the construction of infrastructure, the purchase of wind
        turbines and the payment to development partners. In a close working
        relationship with the management of ET and EES, EWF obtains a first
        priority bank

<PAGE>

        financing of the projects, contained on the project list. The financing
        sum for 2006 is expected to amount to approx. DKK 1 billion and DKK 2-3
        billion for 2007.

    29. Upon the completion of the development and commissioning of the wind
        energy farm, the wind energy farm is taken over by the Shareholders with
        50% to each shareholder at cost plus the development remuneration set
        forth under the recitals. It is of essential importance to the Parties
        that this is structured so that the shares can be consolidated both at
        ET and at EES. It is for the Shareholders to raise sufficient equity
        capital or other financing of their portion of a given project.

    30. If a shareholder cannot raise equity capital or other financing for a
        wind energy farm, the project portion shall be transferred to another
        shareholder in EWF.

    31. If another shareholder cannot or will not procure equity capital or
        other financing of a developed wind energy farm, EWF shall have the
        right to sell the wind energy farm to any external investors.

SHAREHOLDERS' MUTUAL OPTION TO PURCHASE WIND TURBINES AND SHARES IN EWF

    32. Reserving the option to purchase in force from time to time for the
        employees of EWF, EES grants to ET an option to purchase the wind
        turbines, which EES have in commercial operation as of 01.05.2006. Thus,
        perhaps by he sale of one or several wind turbines first, but see
        immediately below concerning the employees' option to purchase, EES will
        offer ET an option to purchase the wind turbines in question.

    33. EES and ET grants each other a mutual option to purchase in case either
        Party should wish to sell its shares in EWF.

    34. EES grants ET an option to purchase the shares in the Italian projects,
        which EES expects to take over from a development partner (i.e. 50% of
        the share capital in Enerteq Vitalba ApS). By such transaction, ET will
        take over half of the Italian projects at the amount realized, which
        EWF's partner achieves.

    35. For a period of three years from the exchange of the shares in EWF with
        shares in ET, ET shall not be entitled to dispose of his shares in EWF,
        because EES' expected permission of tax-free exchange of shares will
        then lapse.

    36. In case of material breach by either Party of its obligations as a
        shareholder in EWF, including material breach of any provisions entered
        into by means of a shareholders' agreement, the aggrieved Party may
        demand that the co-operation between EES and ET be terminated, unless
        the breach is redressed within 30 days after the service of default
        notice upon the Party in breach by the aggrieved Party. If the breach
        has not been redressed or cannot be redressed, the Party in breach shall
        within 60 days after service of default notice by the aggrieved Party as
        set forth above, advance an offer to purchase the shares in EWF owned by
        the aggrieved Party. After that, the aggrieved Party has 180 days for
        either acceptance the offer advanced by the Party in breach or itself
        purchase of the shares of the Party in breach in EWF at the same price.

APPROVAL OF THE AGREEMENT AND CLOSING

    37. This Agreement is subject to approval by the boards of directors of the
        two companies, which approval must be submitted not later than as of 1
        July 2006 and that ET exercises a satisfactory due diligence into EWF to
        be completed by 21 June 2006.

    38. ET's subscription for shares in EWF shall be carried into effect at the
        extraordinary general meeting to be held on 03 July 2006 and ET's
        purchase of shares in EWF is carried into effect as of 05 July 2006,
        both transactions are subject to the aforesaid terms and conditions
        being complied with within the said deadlines.
<PAGE>

    39. The Shareholders agree that in connection with the implementation of
        this Agreement, a normal shareholders' agreement shall be entered into
        to regulate the future co-operation between the Parties as shareholders
        in EWF.

ARBITRATION

    40. Any disputes pertaining to this Agreement shall be settled by
        arbitration in Copenhagen.

APPENDICES

    41. The following Appendices form an integral part of this Agreement:

        Appendix 1 Transfer of companies from EWF to EES
        Appendix 2 Transfer of companies from EES to EWF
        Appendix 3 Ongoing companies in EWF
        Appendix 4 Capital increase and purchase of shares in tabular form
        Appendix 5 Project info catalogue

(Signed in ) Lyngby 10.05.2006
                    ----------

For Eurotrust A/S:                      For European Energy Steems A/S:

-----------------------------------     -----------------------------------
Soren Degn                              Knud Erik Andersen

-----------------------------------
Peter Juul

For European wind energy farms A/S:

-----------------------------------
Knud Erik Andersen

On behalf of Knud Erik Andersen:            On behalf of Mikael D. Pedersen

-----------------------------------     -----------------------------------Exhibit 10.1

                                 LOAN AGREEMENT

Wachovia Bank, National Association
5 Research Drive
Shelton, Connecticut  06084
(Hereinafter referred to as the "Bank")

Thermodynetics, Inc.
651 Day Hill Road
Windsor, Connecticut  06095
(Hereinafter referred to as "Borrower")

This Loan  Agreement  ("Agreement")  is entered into  December 21, 2006,  by and
between Bank and Borrower.

This Agreement applies to the loan or loans (individually and collectively,  the
"Loan") evidenced by one or more promissory notes of even date herewith or other
notes subject  hereto,  as modified from time to time (whether one or more,  the
"Note") and all Loan Documents. The terms "Loan Documents" and "Obligations," as
used in this Agreement, are defined in the Note.

Relying upon the covenants, agreements, representations and warranties contained
in this  Agreement,  Bank is willing to extend credit to Borrower upon the terms
and subject to the conditions  set forth herein,  and Bank and Borrower agree as
follows:

REPRESENTATIONS.  Borrower  represents  that from the date of this Agreement and
until  final  payment  in full of the  Obligations:  ACCURATE  INFORMATION.  All
information now and hereafter furnished to Bank is and will be true, correct and
complete in all material respects.  Any such information  relating to Borrower's
financial condition will accurately reflect Borrower's financial condition as of
the date(s) thereof,  (including all contingent  liabilities of every type), and
Borrower  further  represents  that  its  financial  condition  has not  changed
materially  or  adversely  since the date(s) of such  documents.  AUTHORIZATION;
NON-CONTRAVENTION.  The execution,  delivery and performance by Borrower and any
guarantor, as applicable, of this Agreement and other Loan Documents to which it
is a party are within its power,  have been duly  authorized  as may be required
and, if necessary, by making appropriate filings with any governmental agency or
unit and are the legal, binding,  valid and enforceable  obligations of Borrower
and any guarantors;  and do not (i) contravene,  or constitute  (with or without
the giving of notice or lapse of time or both) a violation  of any  provision of
applicable law, a violation of the  organizational  documents of Borrower or any
guarantor, or a default under any agreement, judgment, injunction, order, decree
or other instrument  binding upon or affecting  Borrower or any guarantor,  (ii)
result in the creation or imposition of any lien (other than the lien(s) created
by the Loan Documents) on any of Borrower's or any guarantor's  assets, or (iii)
give cause for the  acceleration of any obligations of Borrower or any guarantor
to any other creditor.  ASSET OWNERSHIP.  Borrower has good and marketable title
to all of the  properties  and  assets  reflected  on  the  balance  sheets  and
financial  statements  supplied Bank by Borrower,  and all such  properties  and
assets are free and clear of mortgages, security deeds, pledges, liens, charges,
and all other encumbrances, except as otherwise disclosed to Bank by Borrower in
writing and  approved by Bank and as set forth on the policy of title  insurance
delivered  to the  Bank in  connection  with the Loan  ("Permitted  Liens").  To
Borrower's  knowledge,  no default has occurred under any Permitted Liens and no
claims or interests  adverse to Borrower's  present rights in its properties and
assets have arisen.  DISCHARGE OF LIENS AND TAXES. Borrower has duly filed, paid
and/or discharged all taxes or other claims that may become a lien on any of its
property or assets, except to the extent that such items are being appropriately
contested in good faith and an adequate reserve for the payment thereof is being
maintained.  SUFFICIENCY OF CAPITAL.  Borrower is not, and after consummation of
this  Agreement and after giving effect to all  indebtedness  incurred and liens
created by Borrower in  connection  with the Note and any other Loan  Documents,
will not be,  insolvent  within the  meaning of 11 U.S.C.  ss. 101, as in effect
from time to time.  COMPLIANCE  WITH LAWS. To the best of Borrower's  knowledge,
Borrower and any  subsidiary  and affiliate of Borrower and any guarantor are in
compliance in all material respects with all

<PAGE>

federal,  state  and  local  laws,  rules  and  regulations  applicable  to  its
properties,  operations,  business, and finances, including, without limitation,
any federal or state laws relating to liquor  (including 18 U.S.C.  ss. 3617, et
seq.) or narcotics  (including 21 U.S.C. ss. 801, et seq.) and/or any commercial
crimes; all applicable federal, state and local laws and regulations intended to
protect the  environment;  and the Employee  Retirement  Income  Security Act of
1974, as amended ("ERISA"),  if applicable.  None of Borrower, or any subsidiary
or affiliate of Borrower or any  guarantor is a Sanctioned  Person or has any of
its assets in a Sanctioned  Country or does  business in or with, or derives any
of its operating  income from  investments in or transactions  with,  Sanctioned
Persons or Sanctioned Countries in violation of economic sanctions  administered
by OFAC.  The proceeds from the Loan will not be used to fund any operations in,
finance any  investments or activities in, or make any payments to, a Sanctioned
Person  or a  Sanctioned  Country.  "OFAC"  means  the  U.S.  Department  of the
Treasury's  Office of  Foreign  Assets  Control.  "Sanctioned  Country"  means a
country  subject  to  a  sanctions  program identified on the list maintained by
OFAC and available at  http://www.treas.gov/offices/enforcement/ofac/sanctions/,
or  as  otherwise   published  from  time  to  time.  "Sanctioned  Person" means
(i) a  person  named   on   the   list   of  Specially  Designated  Nationals  \
or     Blocked     Persons     maintained      by      OFAC     available     at
http://www.treas.gov/offices/enforcement/ofac/sdn/,  or as  otherwise  published
from  time to time,  or (ii) (A) an  agency of the  government  of a  Sanctioned
Country, (B) an organization controlled by a Sanctioned Country, or (C) a person
resident in a Sanctioned  Country to the extent  subject to a sanctions  program
administered by OFAC. ORGANIZATION AND AUTHORITY. Each corporation,  partnership
or limited liability company Borrower and/or guarantor,  as applicable,  is duly
created,  validly  existing and in good standing  under the laws of the state of
its organization,  and has all powers,  governmental  licenses,  authorizations,
consents and approvals  required to operate its business as now conducted.  Each
corporation, partnership or limited liability company Borrower and/or guarantor,
as  applicable,  is  duly  qualified,  licensed  and in  good  standing  in each
jurisdiction  where  qualification or licensing is required by the nature of its
business or the character  and location of its property,  business or customers,
and in which the  failure to so qualify or be  licensed,  as the case may be, in
the aggregate,  could have a material adverse effect on the business,  financial
position, results of operations, properties or prospects of Borrower or any such
guarantor.  NO LITIGATION.  There are no pending or threatened suits,  claims or
demands  against  Borrower or any guarantor that have not been disclosed to Bank
by Borrower in writing,  and  approved by Bank.  ERISA.  Each  employee  pension
benefit plan, as defined in ERISA,  maintained by Borrower meets, as of the date
hereof,  the minimum funding  standards of ERISA and all applicable  regulations
thereto and requirements  thereof,  and of the Internal Revenue Code of 1986, as
amended.  No "Prohibited  Transaction" or "Reportable  Event" (as both terms are
defined  by ERISA)  has  occurred  with  respect  to any such  plan.  INDEMNITY.
Borrower will  indemnify  Bank and its  affiliates  from and against any losses,
liabilities,  claims,  damages,  penalties or fines  imposed  upon,  asserted or
assessed  against or incurred by Bank arising out of the inaccuracy or breach of
any of the  representations  contained  in  this  Agreement  or any  other  Loan
Documents.

AFFIRMATIVE COVENANTS. Borrower agrees that from the date hereof and until final
payment  in full of the  Obligations,  unless  Bank shall  otherwise  consent in
writing,  Borrower will: ACCESS TO BOOKS AND RECORDS. Allow Bank, or its agents,
during normal business hours and upon reasonable  advance notice,  access to the
books,  records and such other  documents  of Borrower as Bank shall  reasonably
require,  and allow Bank, at Borrower's expense,  to inspect,  audit and examine
the same and to make  extracts  therefrom and to make copies  thereof.  BUSINESS
CONTINUITY.  Conduct its business in substantially the same manner and locations
as such business is now and has previously been  conducted.  CERTIFICATE OF FULL
COMPLIANCE  FROM  ACCOUNTANT.  Deliver to Bank,  with the  financial  statements
required  herein,  a certification  by Borrower's  independent  certified public
accountant  that  Borrower  is in  full  compliance  with  the  Loan  Documents.
COMPLIANCE WITH OTHER AGREEMENTS. Comply with all terms and conditions contained
in this  Agreement,  and any  other  Loan  Documents,  and swap  agreements,  if
applicable,  as defined in 11 U.S.C.  ss.  101,  as in effect from time to time.
ESTOPPEL CERTIFICATE.  Furnish,  within 15 days after request by Bank, a written
statement duly acknowledged of the amount due under the Loan and whether offsets
or  defenses  exist  against  the  Obligations.   INSURANCE.  Maintain  adequate
insurance  coverage with respect to its properties and business  against loss or
damage of the kinds and in the amounts  customarily insured against by companies
of established  reputation engaged in the same or similar businesses  including,
without limitation, commercial general liability insurance, workers compensation
insurance, and business interruption insurance; all acquired in such amounts and
from

                                       2
<PAGE>

such companies as Bank may reasonably require.  MAINTAIN  PROPERTIES.  Maintain,
preserve  and keep its  property in good repair,  working  order and  condition,
making all  replacements,  additions and improvements  thereto necessary for the
proper conduct of its business, unless prohibited by the Loan Documents.  NOTICE
OF DEFAULT AND OTHER NOTICES. (a) NOTICE OF DEFAULT. Furnish to Bank immediately
upon becoming aware of the existence of any condition or event which constitutes
a Default (as defined in the Loan Documents) or any event which, upon the giving
of  notice  or lapse of time or both,  may  become  a  Default,  written  notice
specifying  the nature  and period of  existence  thereof  and the action  which
Borrower is taking or proposes to take with respect thereto.  (b) OTHER NOTICES.
Promptly  notify  Bank in  writing  of (i) any  material  adverse  change in its
financial  condition  or its  business;  (ii) any  default  under  any  material
agreement,  contract or other  instrument to which it is a party or by which any
of its  properties  are  bound,  or any  acceleration  of  the  maturity  of any
indebtedness  owing by Borrower;  (iii) any material  adverse  claim  against or
affecting Borrower or any part of its properties;  (iv) the commencement of, and
any  material  determination  in,  any  litigation  with any third  party or any
proceeding before any governmental agency or unit materially affecting Borrower;
and (v) at least 30 days prior thereto, any change in Borrower's name or address
as shown  above,  and/or any change in  Borrower's  structure.  OTHER  FINANCIAL
INFORMATION.  Deliver promptly such other  information  regarding the operation,
business affairs,  and financial condition of Borrower which Bank may reasonably
request.  PAYMENT OF DEBTS.  Pay and discharge  when due, and before  subject to
penalty or further charge, and otherwise satisfy before maturity or delinquency,
all  obligations,  debts,  taxes,  and liabilities of whatever nature or amount,
except those which Borrower in good faith disputes. REPORTS AND PROXIES. Deliver
to Bank, promptly,  a copy of all financial  statements,  reports,  notices, and
proxy statements, sent by Borrower to stockholders,  and all regular or periodic
reports  required  to be  filed by  Borrower  with any  governmental  agency  or
authority.

NEGATIVE  COVENANTS.  Borrower  agrees that from the date hereof and until final
payment  in full of the  Obligations,  unless  Bank shall  otherwise  consent in
writing,  Borrower  will not:  CHANGE IN FISCAL  YEAR.  Change its fiscal  year.
GUARANTEES.  Guarantee or otherwise  become  responsible  for obligations of any
other person or persons  (except a  subsidiary),  other than the  endorsement of
checks  and  drafts  for   collection  in  the  ordinary   course  of  business.
CROSS-DEFAULT.  Default  (past  any  applicable  grace  period)  in  payment  or
performance  of any of its  obligations  under any  other  loans,  contracts  or
agreements  with  Bank  or  Bank's  affiliates,  nor  permit  any of  Borrower's
subsidiaries to default under any other loans, contracts or agreements with Bank
or Bank's affiliates. DEFAULT ON OTHER CONTRACTS OR OBLIGATIONS.  Default on any
material contract with or obligation when due to a third party or default in the
performance  of any  obligation  to a third party  incurred  for money  borrowed
(beyond  any  applicable  grace  period).  GOVERNMENT  INTERVENTION.  Permit the
assertion  or  making  of any  seizure,  vesting  or  intervention  by or  under
authority of any  governmental  entity,  as a result of which the  management of
Borrower or any  guarantor is  displaced of its  authority in the conduct of its
respective  business  or such  business is  curtailed  or  materially  impaired.
JUDGMENT  ENTERED.  Permit the entry of any monetary  judgment or the assessment
against,  the filing of any tax lien  against,  or the  issuance  of any writ of
garnishment  or  attachment  against any property of or debts due Borrower in an
amount in excess of  $50,000.00  which is not  discharged  or  execution  is not
stayed within 30 days of entry.  RETIRE OR REPURCHASE  CAPITAL STOCK.  Retire or
otherwise  acquire  any of its  capital  stock  unless a  program  to  retire or
otherwise acquire any of its capital stock is approved by the Board of Directors
of the Borrower and such program does not require the actual expenditure of cash
or cash  reserves  of the  Borrower in excess of  $250,000,  and  provided  such
expenditure does not adversely  affect the Borrower's  ability to repay the Loan
or result in a default by Borrower under any of the Loan Documents.

ANNUAL  FINANCIAL  STATEMENTS.  Borrower shall deliver to Bank,  within 120 days
after the close of each fiscal year, audited financial statements reflecting its
operations during such fiscal year,  including,  without  limitation,  a balance
sheet,  profit and loss statement and statement of cash flows,  with  supporting
schedules;  all on a  consolidated  and  consolidating  basis  with  respect  to
Borrower and its  subsidiaries,  affiliates  and parent or holding  company,  as
applicable,  and in reasonable  detail,  prepared in conformity  with  generally
accepted accounting  principles,  applied on a basis consistent with that of the
preceding year. If audited statements are required, all such statements shall be
examined by an independent  certified public accountant reasonably acceptable to
Bank. The opinion of such independent  certified public  accountant shall not be
acceptable  to Bank if  qualified  due to any  limitations  in scope  imposed by

                                       3
<PAGE>

Borrower or any other person or entity.  Any other  qualification of the opinion
by the accountant  shall render the  acceptability  of the financial  statements
subject to Bank's approval.

TAX RETURNS.  Borrower shall deliver to Bank, within 30 days of filing, complete
copies of  federal  and state tax  returns,  as  applicable,  together  with all
schedules thereto, each of which shall be signed and certified by Borrower to be
true and complete  copies of such  returns.  In the event an extension is filed,
Borrower shall deliver a copy of the extension within 30 days of filing.

FINANCIAL  COVENANTS.  Borrower agrees to the following provisions from the date
hereof  until  final  payment  in full of the  Obligations,  unless  Bank  shall
otherwise consent in writing,  using the financial information for Borrower, its
subsidiaries, affiliates and its holding or parent company, as applicable: FIXED
CHARGE  COVERAGE RATIO.  Borrower  shall, at all times,  maintain a Fixed Charge
Coverage Ratio of not less than 1.25 to 1.00.  This covenant shall be calculated
at Borrower's  fiscal year end. "Fixed Charge Coverage Ratio" shall mean the sum
of net income plus interest expense,  depreciation and amortization expense plus
rent  expense  less  all  dividends,   distributions  and  withdrawals  and  all
unfinanced capital expenditures divided by the sum of current maturities of long
term debt,  current  maturities of long term capital leases,  plus rent expense,
plus  interest  expense.  This  covenant  shall  be  measured  annually.   TOTAL
LIABILITIES TO TANGIBLE NET WORTH RATIO.  Borrower shall, at all times, maintain
a ratio of Total  Liabilities  to  Tangible  Net  Worth of not more than 1.50 to
1.00.  "Total  Liabilities"  shall mean all  liabilities of Borrower,  including
capitalized  leases and all reserves for deferred taxes, debt fully subordinated
to Bank on terms and  conditions  acceptable  to Bank,  and other  deferred sums
appearing on the  liabilities  side of a balance  sheet and all  obligations  as
lessee under off-balance  sheet synthetic leases of Borrower,  all in accordance
with generally  accepted  accounting  principles  applied on a consistent basis.
"Tangible  Net Worth"  shall mean total  assets  minus  Total  Liabilities.  For
purposes of this  computation,  the aggregate amount of any intangible assets of
Borrower including, without limitation, goodwill, franchises, licenses, patents,
trademarks,  trade names,  copyrights,  service marks, and brand names, shall be
subtracted from total assets. This covenant shall be measured annually.  DEPOSIT
RELATIONSHIP. Borrower shall maintain its primary depository account with Bank.

CONDITIONS PRECEDENT.  The obligations of Bank to make the loan and any advances
pursuant to this  Agreement are subject to the following  conditions  precedent:
ADDITIONAL DOCUMENTS. Receipt by Bank of such additional supporting documents as
Bank or its counsel may reasonably request.

CONNECTICUT  PREJUDGMENT  REMEDY  WAIVER.  EACH BORROWER  ACKNOWLEDGES  THAT THE
TRANSACTIONS  REPRESENTED  BY THIS  AGREEMENT ARE  COMMERCIAL  TRANSACTIONS  AND
HEREBY  VOLUNTARILY AND KNOWINGLY  WAIVES ANY RIGHTS TO NOTICE OF AND HEARING ON
PREJUDGMENT  REMEDIES UNDER CHAPTER 903A OF THE CONNECTICUT  GENERAL STATUTES OR
OTHER  STATUTES  AFFECTING  PREJUDGMENT  REMEDIES,  AND  AUTHORIZES  THE  BANK'S
ATTORNEY TO ISSUE A WRIT FOR A PREJUDGMENT REMEDY WITHOUT COURT ORDER,  PROVIDED
THE COMPLAINT SHALL SET FORTH A COPY OF THIS WAIVER.

IN WITNESS WHEREOF,  Borrower and Bank, on the day and year first written above,
have caused this Agreement to be duly executed under seal.

                              Thermodynetics, Inc.

                              By:  /s/ JOHN F. FERRARO           (SEAL)
                                  -------------------------------
                                       John F. Ferraro, Chairman

                              Wachovia Bank, National Association

                              By: /s/ BRIAN PORCH                        (SEAL)
                                  --------------------------------------
                                      Brian Porch, Senior Vice President

                                       4

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