Document:

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                                                                    EXHIBIT 4.26

                             DISTRIBUTION AGREEMENT

THIS AGREEMENT is made as of the 22nd day of August, 2001

B E T W E E N:

                  HYDROGENICS CORPORATION, a company organized and existing
                  under the laws of Canada (the "Supplier")

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                  TOYOTA TSUSHO CORPORATION, a company organized and existing
                  under the laws of Japan (the "Distributor").

RECITALS:

A.       Supplier is engaged in the manufacture of fuel cell test stations and
         related devices;

B.       Distributor has the resources to effectively market and sell the goods
         of Supplier, including the required technical knowledge of selling,
         distributing and advertising processes and techniques, including
         knowledge of the local laws, customs, market conditions, exchange
         control and international finance;

C.       Distributor desires to purchase such merchandise from Supplier for sale
         within the Territory specified herein;

D.       The parties are desirous of formalizing their relationship under the
         terms of this Agreement.

THEREFORE the parties agree as follows:

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                                    ARTICLE 1
                                 INTERPRETATION

1.1      DEFINITIONS

Wherever used in this Agreement, unless there is something in the subject matter
or context inconsistent therewith, the following words and terms shall have the
respective meanings ascribed to them as follows:

         (a)      "ACCOUNTING PERIOD" means a three month period commencing on
                  the first business day of the first month and ending on the
                  last business day of the third month, with each successive
                  Accounting Period to commence on the first business day
                  following the close of the immediately preceding Accounting
                  Period;

         (b)      "AGREEMENT" means this agreement entitled "Distribution
                  Agreement" and all instruments supplemental hereto or in
                  amendment or confirmation hereof;

         (c)      "FORCE MAJEURE" has the meaning given to such term in Section
                  10.4 hereof;

         (d)      "NOTICE" has the meaning given to such term in Section 10.12
                  hereof;

         (e)      "PRIME BANK RATE" means the prime commercial lending rate of
                  interest (expressed as an annual rate) which Supplier's
                  bankers establish as the reference rate of interest that the
                  bank would charge its customers for loans in Canadian funds,
                  as the same may be in effect from time to time;

         (f)      "PRODUCT PRICE LIST" has the meaning given to such term in
                  Subsection 3.4(b)(ii) hereof;

         (g)      "PRODUCTS" means and is restricted to fuel cell test stations
                  that are manufactured and supplied by Supplier, including
                  service and maintenance contracts and all related devices. For
                  greater certainty the term "Products" shall not include fuel
                  cell power generators and other non-testing products
                  manufactured by Supplier. Supplier reserves the right to add a
                  product to this Agreement, to discontinue a product, and to
                  modify or amend the standards and specifications of such
                  product and its packaging during the Term of this Agreement on
                  Notice to Distributor. In

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                  such event, product added to, modified or amended shall be
                  considered to be Product and discontinued product shall not be
                  considered to be Product for the purposes of this Agreement;

         (h)      "SUPPLIER TRADE-MARKS" means the trade-names, trade-marks and
                  other commercial symbols of Supplier which may be used in
                  connection with the sale or servicing of the Products, namely
                  those trade-marks listed in Schedule "A" hereof;

         (i)      "TERM" means and includes the initial and any renewal terms of
                  this Agreement; and

         (j)      "TERRITORY" shall mean the geographic area of Japan.

1.2      GENDER AND NUMBER

In this Agreement, words importing the singular include the plural and vice
versa and words importing gender include all genders.

1.3      ARTICLE AND SECTION HEADINGS

The insertion of headings and the division of this Agreement into articles and
sections are for convenience of reference only and shall not affect the
interpretation hereof.

1.4      ENTIRE AGREEMENT

This Agreement and any documents incorporated by reference herein constitute the
entire agreement between the parties pertaining to the subject matter hereof and
supersede all prior agreements, understandings, negotiations and discussions
with respect to the subject matter hereof whether oral or written. Except as
provided in such materials, there are no conditions, representations,
warranties, undertakings, promises, inducements or agreements whether direct,
indirect, collateral, express or implied made by Supplier to Distributor. No
supplement, modification or waiver of this Agreement shall be binding unless
executed in writing by Supplier and Distributor.

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1.5      APPLICABLE LAW

This Agreement shall be governed by and construed in accordance with the United
Nations Convention on Contracts for the International Sale of Goods.

1.6      SEVERABILITY

If in any jurisdiction, any provision of this Agreement or its application to
any party or circumstance is restricted, prohibited or unenforceable, such
provision shall, as to such jurisdiction, be ineffective only to the extent of
such restriction, prohibition or unenforceability without invalidating the
remaining provision hereof and without affecting the validity or enforceability
of such provision in any other jurisdiction or its application to other parties
or circumstances.

1.7      NON-WAIVER

The failure of Supplier to exercise any right, power or option given hereunder
or to insist upon the strict compliance with the terms and conditions hereof by
Distributor shall not constitute a waiver of the terms and conditions of this
Agreement with respect to that or any other or subsequent breach thereof nor a
waiver by Supplier of its rights at any time thereafter to require strict
compliance with all terms and conditions hereof including the terms or
conditions with respect to which Distributor has failed to exercise such right,
power or option.

                                    ARTICLE 2

                                      GRANT

2.1      GRANT

Subject to the terms and conditions of this Agreement, Supplier grants to
Distributor the right to act as exclusive distributor of the Products within the
Territory and to use or display Supplier Trade-marks in association therewith.

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2.2      ACCEPTANCE

Distributor accepts its appointment as the exclusive distributor of the Products
in the Territory upon the terms, provisions and conditions of this Agreement.

2.3       RESTRICTIONS

Distributor shall not sell, distribute or advertise products which are similar
to, which perform the same functions as or which compete with the Products
during the Term of this Agreement without the prior written consent of Supplier.

2.4      TERM

Unless otherwise terminated pursuant to this Agreement, this Agreement shall
remain in force for a period of two (2) years from the date of execution.

2.5      RENEWAL

This Agreement may be renewed by Distributor for additional renewal terms of two
(2) years each, provided that Distributor shall have substantially complied with
all of the provisions of this Agreement, Distributor shall have given to
Supplier at least two (2) months' Notice prior to the expiry of the then current
Term of its intention to renew this Agreement, and the parties shall have agreed
in writing to the renewal Term purchase requirements. In the case of a failure
by the parties to reach an agreement on the renewal Term purchase requirements
and/or a failure by the Distributor to meet the purchase requirements of the
initial Term or any subsequent renewal Term, this Agreement shall become
non-exclusive, provided, however, that in either case Distributor shall retain
the right to distribute Products in the Territory for an additional two (2) year
period, subject to the terms and conditions of this Agreement.

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                                    ARTICLE 3

                                ORDER AND PRICES

3.1      ORDERS

All Distributor orders for Products shall be subject to the terms and conditions
contained in this Agreement, and such further additional terms and conditions
which may from time to time be agreed between the parties and appended or
attached to Supplier's quotations and/or Distributor's purchase orders. In the
event that such additional terms and conditions are different from or
inconsistent with the terms and conditions of this Agreement, the terms and
conditions of such additional terms and conditions shall govern. Notwithstanding
anything herein to the contrary, Distributor's wholly-owned subsidiary, Toyota
Tsusho America, Inc., may place orders to Supplier pursuant to this Agreement
strictly for resale to Distributor, which order and sales procedure shall not
otherwise effect the rights and responsibilities of Supplier and Distributor
under this Agreement.

3.2      PURCHASE REQUIREMENTS

Distributor shall (but not be obliged to), during the Term of this Agreement,
endeavour to complete the purchase from Supplier of a minimum of US$5 million of
Products. For greater certainty, sales generated by Distributor prior to the
signing of this Agreement shall be included in the calculation of the amount of
Product purchased by Distributor during the initial Term.

3.3      RIGHT TO PURCHASE

Supplier agrees to sell to Distributor and Distributor agrees to purchase from
Supplier and pay Supplier for such quantities of the Products as Distributor may
reasonably request and as Supplier, using its best efforts, is capable of
supplying at the prices and subject to the other terms and conditions of sale
established by Supplier and in effect at the time of shipment including, without
limitation, invoice and/or purchase order terms.

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3.4      PRODUCT PRICING

         (a)      Distributor acknowledges and agrees that competitive pricing
                  of Products and competitive rates for the servicing of
                  Products in the Territory is an essential ingredient in
                  adequately servicing the needs of Supplier hereunder.

         (b)      Distributor shall be free to sell the Products in the
                  Territory at whatever price it is able to obtain, provided,
                  however, that:

                  (i)      Distributor quotes and sets prices for the Product in
                           the Territory in accordance with the spirit and
                           intent of Section 3.4(a) hereof;

                  (ii)     Distributor quotes and sets prices for the Product in
                           the Territory by reference to Supplier's non-binding
                           retail Product price list for the Territory (the
                           "Product Price List"), as determined by Supplier in
                           its sole discretion, after consultation with
                           Distributor. The current Product Price List is
                           appended as Schedule "B" to this Agreement.
                           Distributor acknowledges receipt of the Product Price
                           List and agrees that such price list (as it may be
                           issued, amended and modified by Supplier from time to
                           time) shall be an integral part of this Agreement and
                           incorporated by reference hereto; and

                  (iii)    the gross price at which a Product is sold by
                           Distributor in the Territory shall be reported in
                           writing to Supplier in accordance with the reporting
                           obligations described in Sections 4.3 and 6.2 (1)
                           hereof.

         (c)      The prices at which Supplier sells the Products to Distributor
                  shall be determined on a quotation basis, based on Supplier's
                  "Ex Works" Mississauga price as determined by Supplier, its
                  sole discretion, provided, however, that Supplier shall set
                  its price by reference to the then current Product Price List
                  less applicable distributor discounts.

3.5      RESERVATIONS OF SUPPLIER

         (a)      Supplier reserves the right to:

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                  (i)      solicit orders from and sell Products directly for
                           its own account to parties located in the Territory
                           who specifically request Supplier in writing to
                           transact directly with the Supplier;

                  (ii)     accept orders from customers outside the Territory to
                           their subsidiaries in the Territory; and

                  (iii)    use distributors in the Territory from time to time,
                           solely in order to effect the sales described in
                           Subsections 3.5(a)(i) and (ii).

         (b)      Upon the exercise by Supplier of the rights described in
                  Subsection 3.5(a) hereof, Supplier agrees to notify
                  Distributor and to pay Distributor a commission of 5% on the
                  value of all such deliveries made by Supplier in the
                  Territory, provided that Distributor initiated and/or assisted
                  in effecting such sales.

         (c)      Supplier agrees that the Product price of sales effected in
                  the Territory pursuant to the Supplier's rights described in
                  Subsection 3.5(a) hereof shall be set by reference to the then
                  current Product Price List.

3.6      ORDERS FOR PRODUCTS

Distributor shall order all Products by completion of a standard order form as
may be prepared and supplied from time to time by Supplier. Notwithstanding the
foregoing, Distributor may use its own purchase order or other business form to
order Products under this Agreement, provided that no provisions contained in
any such purchase order or business form or other Distributor document or
communication which are different from or additional to this Agreement or
Supplier's standard order form then in effect shall be binding upon Supplier or
have any force or effect whatsoever. No failure by Supplier to object to any
such provisions shall be deemed a waiver hereof.

3.7      ACCEPTANCE OF ORDERS

All purchase orders for Products are subject to acceptance by Supplier. Each
proposed purchase order of Distributor shall be deemed void and without effect
if not accepted by Supplier within 15 days after the date of receipt thereof by
Supplier. Supplier reserves the right to reject any purchase order in its sole
discretion.

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                                    ARTICLE 4

                              DELIVERY AND PAYMENT

4.1      PRODUCT DELIVERY

         (a)      Unless otherwise stipulated by the terms of standard purchase
                  orders as may be prepared by the parties from time to time,
                  all deliveries of the Products shall be "Ex Works" Mississauga
                  facility. Risk of loss shall pass to Distributor when the
                  Products are put into the possession of the carrier, at which
                  point Supplier shall be deemed to have completed good delivery
                  to Distributor.

         (b)      Distributor shall be responsible for all duties, taxes, costs
                  and procedures and compliance with all local laws, associated
                  with importing all material shipped to Distributor under this
                  Agreement into the country of destination.

         (c)      Distributor shall make a thorough inspection of each shipment
                  of Products upon receipt by Distributor thereof. If
                  Distributor believes that the shipment does not conform to the
                  subject order in any respect, Distributor shall give Supplier
                  notice in writing, setting out the full particulars of the
                  alleged nonconformance, within (30) calendar days after
                  receipt by Distributor of the shipment and shall make such
                  shipment available at Distributor's premises for inspection by
                  Supplier or its representative. Failure to give such notice
                  within the 30-day period shall bar Distributor from making any
                  claim excluding latent defect that the shipment of Products
                  failed to comply with the order.

         (d)      The parties agree to exclude the application of article 50 of
                  the United Nations Convention on Contracts for the
                  International Sale of Goods, which would otherwise authorize
                  Distributor to reduce the price in accordance with the formula
                  set out in that article when the goods tendered do not
                  conform.

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4.2      PAYMENT

Unless otherwise stipulated by the terms of standard purchase orders as may be
prepared by the parties from time to time, payment in full for Products
purchased by Distributor from Supplier shall be remitted to Supplier within
thirty (30) days after the delivery of Products so purchased. Unless otherwise
stipulated in the terms of individual quotations, all payments to be made to
Supplier hereunder shall be made to Supplier in United States dollars and shall
be sent to Supplier at Supplier's address as provided herein or to such address
as Supplier may specify in writing. Distributor agrees that all amounts to be
paid to Supplier by Distributor shall be paid notwithstanding Distributor's
failure or inability to collect amounts owing to it from customers.

4.3      PERIODIC STATEMENTS

Distributor agrees to submit to Supplier within thirty (30) days of each
Accounting Period a complete and accurate operating statement for that period in
the form and manner prescribed by Supplier detailing such matters as Product
sold by Distributor in such period.

4.4      OVERDUE AMOUNTS

Any amounts owed to Supplier by Distributor pursuant to this Agreement or
otherwise shall bear interest from the due date until paid in full at a rate of
interest equal to the Prime Bank Rate plus five percent (5%) or the highest
amount permitted by applicable law, whichever is lower, such amount to be
calculated and payable weekly, both before and after default, with interest on
overdue interest at the same rate. The acceptance by Supplier of any interest
payment shall be without prejudice to Supplier's right to terminate this
Agreement in respect of such default.

4.5      CONFORMITY

         (a)      Notwithstanding article 39(1) of the United Nations Convention
                  on Contracts for the International Sale of Goods, the parties
                  agree that Distributor loses the right to rely on a lack of
                  conformity of the goods if Distributor does not give notice to
                  the Supplier specifying the nature of the lack of conformity
                  within thirty (30) days after Distributor has discovered it or
                  ought to have discovered it.

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         (b)      Notwithstanding article 39(2) of the United Nations Convention
                  on Contracts for the International Sale of Goods, the parties
                  agree that Distributor loses the right to rely on a lack of
                  conformity of the goods if Distributor does not give the
                  Supplier notice thereof at the latest within a period of seven
                  months from the date on which the goods were actually handed
                  over to Distributor.

                                    ARTICLE 5
                                    WARRANTY

5.1      WARRANTY

Except as set out in Supplier's standard warranty, Supplier makes no claims,
statements, warranties, assurances, guarantees or representations whatsoever,
whether express, implied, statutory, collateral or otherwise concerning the
Products other than that they shall meet Supplier's specifications, tolerances
and quality standards as they may be in effect from time to time. Any
recommendation made by Supplier concerning uses or applications of Products are
believed reliable but Supplier makes no warranty, assurance, guarantee or
representation in respect thereof. Distributor shall make no warranties or
guarantees with respect to the Products except as may be authorized by Supplier
in writing. Distributor agrees to comply at all times with all applicable
consumer product warranty legislation and take all actions that Supplier may
from time to time request for the purpose of compliance with such legislation.

5.2      LIMITATION ON LIABILITY

Supplier's sole liability, and Distributor's sole remedy and entitlement against
Supplier, in respect of any of the Products shall be limited to an amount which
shall not exceed US$5 million. In no event shall Supplier be liable for any
loss, injury or damage, whether direct, indirect, collateral, special or
consequential, whether suffered by Distributor, any party dealing with
Distributor or any third party, whether in connection with the Products, or
resulting from the sale, use or application of the Products or otherwise,
including without limitation, personal injury, loss of profits or other economic
loss.

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                                    ARTICLE 6

                     OBLIGATIONS OF SUPPLIER AND DISTRIBUTOR

6.1      SUPPLIER'S OBLIGATIONS

During the term of this Agreement, Supplier shall provide Distributor with such
reasonable assistance as Supplier shall deem reasonably necessary to assist
Distributor in effectively advertising, distributing and promoting the Products
throughout the Territory. Without limiting the generality of the foregoing,
Supplier shall:

         (a)      maintain Products for display and demonstration at Supplier's
                  Tokyo showroom;

         (b)      extend to Distributor and its customers in respect of all
                  Products sold to Distributor hereunder Supplier's applicable
                  standard warranty for such Products, and provide applicable
                  warranty service in respect thereof; and

         (c)      provide first-line technical support for the installation,
                  maintenance and use of the Products by customers in the
                  Territory;

         (d)      assist Distributor by furnishing Distributor with standard
                  descriptive literature and standard information such as
                  technical data and manuals as are necessary to promote the
                  sale of the Products, and including trade advertisements and
                  promotional literature, if requested by Distributor.
                  Distributor shall be responsible for the expense of any
                  translation, reproduction and printing necessary to make the
                  information suitable for use in the Territory. Special price
                  lists or literature shall be the responsibility of
                  Distributor;

         (e)      provide technical support to Distributor, by answering
                  technical questions promptly; and

         (f)      advise Distributor of all improvements and changes regarding
                  the Products, and assist Distributor in communicating such
                  information to customers in the Territory.

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6.2      DISTRIBUTOR'S OBLIGATIONS

In order to maintain the high reputation and goodwill associated with Supplier
and the Products, Distributor shall, except where otherwise agreed to in writing
by Supplier:

         (a)      use its best efforts to develop and promote the sales and
                  distribution of the Products in the Territory;

         (b)      establish and maintain a competent sales staff to call upon
                  prospective purchasers of Products in the Territory as is
                  necessary for the performance of its obligations under this
                  Agreement;

         (c)      display and/or distribute all advertising and promotional
                  materials (if any) which may be provided by Supplier and
                  co-operate fully with Supplier in connection with all
                  promotional programs and sales programs (if any) offered by
                  Supplier;

         (d)      at no time engage in any activities which may adversely affect
                  the reputation and goodwill of Distributor, Supplier or the
                  Products. Without limiting the foregoing, Distributor shall
                  not engage in any illegal, deceptive, unfair or unethical
                  trade practices with respect to the Products nor make any
                  false, misleading or disparaging representations about
                  Supplier or the Product;

         (e)      comply with all reasonable mandatory procedures and
                  specifications (if any) from time to time prescribed by
                  Supplier relating to the sale and distribution of the
                  Products;

         (f)      comply with all laws, regulations, by-laws, orders, rulings
                  and ordinances, including without limitation consumer
                  protection and trade practices laws, and obtain all necessary
                  permits and licences which may have application to the
                  advertising, sale and distribution of the Products; and

         (g)      extend to Distributor's customers in respect of all Products
                  sold to Distributor hereunder all applicable standard Supplier
                  product warranties;

         (h)      ensure that the Products comply with local regulations as to
                  safety, packaging and marking;

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         (i)      advertise and promote sales in accordance with policies
                  established by Supplier from time to time;

         (j)      attend and actively participate in appropriate trade shows in
                  the Territory which are or could be useful or appropriate for
                  the sale of the Products;

         (k)      in consultation with Supplier, design, develop and implement
                  annual marketing plans which shall include the development and
                  implementation of a marketing strategy, including catalogues,
                  literature, advertisements, mailings, trade shows, sales
                  training programs and promotions;

         (l)      provide on each anniversary of this Agreement, a detailed
                  written market report including but not limited to such
                  information as a review of the previous twelve months, a
                  preview of the forthcoming year, market conditions and
                  competition. Such report shall also include an updated
                  detailed marketing plan in writing for discussion with
                  Supplier in order that an agreed program may be implemented
                  the following year;

         (m)      to the extent that Distributor displays Products in one its
                  showrooms, consult with Supplier and obtain the permission of
                  Supplier, prior to demonstrating Products or allowing persons
                  access to the Products. Without the prior written consent of
                  Supplier, under no circumstance shall Distributor demonstrate
                  the Products to, or permit access to, persons associated with,
                  in any capacity, the following entities: Chino Corp., Nissei
                  Sangyo Co. Ltd., Toyo Technica, Tsukasa Sokken, Globetech and
                  Giner;

         (n)      pay all expenses for the implementation of marketing research,
                  telex, fax, telephone, postage, travel, promotion,
                  advertising, the cost of all personnel and independent
                  contractors employed or engaged in the implementations of the
                  marketing plan and the sales of the Product;

         (o)      use its best efforts to maintain good commercial relations
                  with customers and potential customers of the Products in the
                  Territory, and promote the interests of Supplier in the
                  Territory. In this regard, Distributor shall: make prompt
                  deliveries of orders; communicate to Supplier promptly all
                  customer service, repair and

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                  replacement service requests in the Territory; and, pass on to
                  Supplier all complaints concerning the sales of the Products;

         (p)      provide monthly reports in respect of the quotation activity
                  of the Distributor during the month, including customer names,
                  delivery dates, quotation prices and internal Distributor
                  rankings; and

         (q)      ensure that any registration or notification required by the
                  laws of the Territory shall have been carried out. Distributor
                  shall comply with all laws and regulations as may apply with
                  the Territory, as applicable to this agreement and all
                  transactions and activities contemplated or to be performed
                  hereunder, and shall procure and maintain all approvals,
                  licences, permissions and permits necessary to the performance
                  of its business and conduct its business in a manner so as to
                  not bring discredit upon the reputation of the Products or
                  Supplier. Distributor shall keep Supplier informed of any laws
                  or regulations of the Territory which may affect the
                  promotion, sales, services or maintenance of the Products in
                  order that Supplier will not breach any such laws or
                  regulations through lack of awareness thereof.

6.3      PROHIBITIONS OF DISTRIBUTOR

Distributor shall not:

         (a)      apply any attachments or accessories to the Products or modify
                  or alter the Products without the prior written approval of
                  Supplier;

         (b)      advertise the Products outside the Territory except where
                  advertisements are included in international publications;

         (c)      seek customers, establish any branch or maintain any office or
                  depot in relation to the Products anywhere outside the
                  Territory; and

         (d)      during the Term of this Agreement, except with the prior
                  written consent of Supplier, sell, distribute or advertise,
                  either directly or indirectly, any products in the Territory
                  which are like or similar to, or which, either alone or in
                  conjunction

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                  with some other product, perform or are designed to perform
                  the same or similar function to, or which might otherwise
                  compete or interfere with, the Products.

                                    ARTICLE 7

                       TRADEMARKS / INTELLECTUAL PROPERTY

7.1      USE OF SUPPLIER TRADE-MARKS

Distributor agrees and acknowledges that Supplier is the exclusive owner of
Supplier Trade-marks and that the rights granted herein to Distributor to use
Supplier Trade-marks apply only to their use in connection with the advertising,
marketing and sale of the Products to Distributor's current and potential
customers within the Territory in accordance with this Agreement and not
otherwise. Supplier grants Distributor the right to affix its name, address and
telephone number to brochures, sales literature, graphics and data sheets
concerning the Products provided that Distributor must in all cases state that
it is an authorized, independent distributor of the Products. Distributor shall
not:

         (a)      directly or indirectly attempt to dilute the value of the
                  goodwill attached to any of Supplier Trade-marks, nor counsel,
                  procure or assist anyone to do any of the foregoing; or

         (b)      dispute or contest for any reason whatsoever, directly or
                  indirectly, during or after the term of this Agreement, the
                  validity, ownership or enforceability of any of Supplier
                  Trade-marks.

7.2      INFRINGEMENT

Distributor agrees to notify Supplier promptly of any attempt by any person
other than Supplier or a licensed distributor of Supplier to use Supplier
Trade-marks or any variation or imitation thereof and to notify Supplier
immediately of any action involving Supplier Trade-marks that is threatened or
instituted by any person against Distributor and to allow Supplier to undertake
the defence of any such action. Should any action involving Supplier Trade-marks
be threatened or instituted by any person against Distributor, Supplier agrees
to defend Distributor and to indemnify and hold it harmless from all fines,
suits, proceedings, losses, claims, demands or actions of any nature or kind
whatsoever directly or indirectly arising out of or associated or

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connected with the use of Supplier Trade-marks and against any and all damages,
costs, expenses and fees (including, without limitation, reasonable legal
expenses) incurred by or on behalf of Distributor in the investigation or
defence of any and all such suits, proceedings, claims, demands or actions;
provided, however, that Supplier shall have full control of such action
including the right to settle such suits, proceedings, claims, demands or
actions on Distributor's behalf. Supplier shall have the sole right, but no
obligation, to commence proceedings to restrain any unauthorized uses of
Supplier Trade-marks or any variations or imitations thereof and to receive the
benefits of any such suits, proceedings, claims, demands or actions. Distributor
shall fully co-operate with Supplier, at Supplier's expense, in providing any
support that Supplier might reasonably request in respect of the defence or
prosecution of any such suits, proceedings, claims, demands or actions.

7.3      INTELLECTUAL PROPERTY

Distributor acknowledges that all intellectual property relating to the Products
is owned by or licensed to Supplier. Distributor agrees that it shall not
violate or infringe such intellectual property rights nor shall it, nor any of
its affiliates, attempt to reverse engineer the Products or manufacture, use,
sell, distribute or advertise products which have been derived from the reverse
engineering of the Products during or after the Term of the Agreement.

                                    ARTICLE 8

                                   TERMINATION

8.1      TERMINATION

This Agreement and all rights granted herein shall terminate effective
immediately if:

         (a)      either party makes a general assignment for the benefit of
                  creditors or a proposal or arrangement under any bankruptcy or
                  creditor protection legislation, if a bona fide petition is
                  filed against either party under any bankruptcy or creditor
                  protection legislation, if either party shall be declared or
                  adjudicated bankrupt, if a liquidator, trustee in bankruptcy
                  or any other officer with similar powers shall be appointed of
                  or for either party or if either party shall commit an act of
                  bankruptcy or shall propose a compromise or arrangement or
                  institute proceedings
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                                     - 18 -

                  to be adjudged bankrupt or become insolvent or consent to the
                  institution of such appointment or proceedings;

         (b)      either party assigns or attempts to assign or transfer this
                  Agreement or any rights hereunder to any person without the
                  prior written consent of the other party;

         (c)      either party is in default of any of its obligations under
                  this Agreement for reasons other than Force Majeure including
                  ceasing, taking steps to cease or threatening to cease its
                  operations as a going concern and fails to cure such default
                  or satisfy the other party that such default has been cured
                  within fifteen (15) days of receiving Notice from the other
                  party to cure the same; or

         (d)      either party has received from the other party during any
                  consecutive twelve (12) month period two (2) or more Notices
                  relating to a default under this Agreement (whether such
                  Notices relate to the same or different types of default and
                  whether or not such defaults have been remedied by the
                  defaulting party).

8.2      DISTRIBUTOR'S OBLIGATIONS ON TERMINATION

Upon the termination, expiration or non-renewal of this Agreement for any reason
whatsoever, the rights granted herein shall forthwith cease and terminate and
Distributor shall:

         (a)      immediately pay to Supplier all fees, amounts and other
                  charges as have become due hereunder or under any agreement of
                  purchase and sale between the parties;

         (b)      immediately cease to and thereafter not, directly or
                  indirectly, hold itself out as a Supplier distributor;

         (c)      ship to Supplier, at Supplier's expense and at such location
                  as Supplier may designate, all advertising and promotional
                  materials provided or made available by Supplier;

         (d)      immediately cease to use, directly or indirectly, in
                  advertising or in any other manner whatsoever the Supplier
                  Trade-marks and remove such trade-marks from or deliver up to
                  Supplier or its duly authorized representatives all materials
                  including signs and advertising materials in its possession,
                  custody or control

<PAGE>
                                     - 19 -

                  upon which the Supplier Trade-marks appear (except for
                  documents not for public display or reasonably required for
                  archival purposes).

8.3      UNFILLED ORDERS

Supplier agrees that it shall honour all Distributor orders accepted by it prior
to the termination or expiration of this Agreement. Distributor orders that have
not been accepted by Supplier at the termination or expiration of this Agreement
shall be deemed cancelled and Supplier shall have no liability to Distributor or
to any other party by virtue of the termination or expiration of the Agreement
including, but not limited to, any claim for loss of profits or prospective
profits from anticipated sales of the Products.

8.4      OTHER RELIEF

Any termination under Article 8 hereof shall be without prejudice to any other
rights (including any right of indemnity), remedy or relief vested in or to
which either party may otherwise be entitled against the other. Any refusal to
renew this Agreement shall not give rise to any liability for indemnity or other
compensation to Distributor and Distributor expressly waives any right to
indemnity or compensation if Supplier terminates this Agreement as provided
herein or exercises its right not to renew this Agreement. The foregoing remedy
shall not exclude any other remedies which either party may have at law or in
equity by reason of default, breach or nonobservance by the other party of any
provision hereof.

8.5      PERIODS OF NOTICE

Each party acknowledges that the periods of notice (if any) provided for
termination of this Agreement are adequate under the circumstances to permit
each party to take all actions required to adjust its business operations in
anticipation of the termination of this Agreement.

<PAGE>
                                     - 20 -

                                    ARTICLE 9

                        RELATIONSHIP AND INDEMNIFICATION

9.1      INDEPENDENT PARTIES

The relationship between Distributor and Supplier is intended to be and shall be
that of buyer and seller, and Distributor and its employees, agents and
representatives shall under no circumstances be considered agents, partners,
joint venturers or representatives of Supplier. Distributor shall not act or
attempt to act, or represent itself, directly or by implication, as agent, joint
venturer, partner or representative of Supplier or in any manner assume or
attempt to assume or create any obligation or liability of any kind, nature or
sort, express or implied, on behalf of or in the name of Supplier. Neither party
shall be bound in any manner whatsoever by any agreements, warranties or
representations made by the other party to any other person nor with respect to
any other action of the other party.

9.2      NON-LIABILITY

Supplier shall not be obligated or liable for any injury or death of any person
or damage to any property caused by or relating to Distributor's actions,
failure to act, negligence or willful conduct, nor for any liability of
Distributor.

9.3      DISTRIBUTOR INDEMNITY

Distributor hereby indemnifies and undertakes to defend Supplier and its
shareholders, directors, officers, employees and agents and hold them harmless
from all fines, suits, proceedings, losses, claims, demands or actions of any
nature or kind whatsoever, directly or indirectly, arising out of or in any
manner whatsoever associated or connected with Distributor's performance,
purported performance or non-performance of its rights and obligations under
this Agreement and against any and all damages, costs, expenses and fees
(including without limitation reasonable legal expenses) incurred by or on
behalf of any of the foregoing in the investigation or defence of any and all
such suits, proceedings, claims, demands or actions.

<PAGE>
                                     - 21 -

9.4      INSURANCE

         (a)      Distributor shall procure and maintain, in full force and
                  effect, a comprehensive general liability insurance policy or
                  policies with personal injury liability blanket, contractual
                  liability, product liability and completed operations
                  liability insurance endorsements protecting Distributor and
                  Supplier and their officers and employees against any loss,
                  liability or expense due to personal injury, death or property
                  damage or otherwise arising out of or occurring in connection
                  with the business of Distributor. Supplier shall be an
                  additional insured in such policy or policies which shall be
                  written by a responsible insurance company or companies
                  licensed to do business in the Territory and meeting with the
                  reasonable approval of Supplier, with a combined single limit
                  of not less than $5 million for bodily injury or death and for
                  property damage. Such policy or policies shall provide that
                  they will not be cancelled or altered without at least sixty
                  days' prior written notice to Supplier. Within ten days after
                  execution of the agreement, Distributor shall furnish Supplier
                  with a certificate or certificates of such insurance, together
                  with evidence that the premiums therefor have been paid.
                  Maintenance of such insurance and the performance by
                  Distributor of its obligations under this paragraph shall not
                  relieve Distributor of liability under the indemnity
                  provisions.

         (b)      Supplier shall maintain $10 million of product liability
                  insurance coverage on the Products. A certificate of insurance
                  shall be provided to Distributor upon Distributor's written
                  request.

                                   ARTICLE 10

                                     GENERAL

10.1     CONFIDENTIALITY OF DISTRIBUTOR

Distributor acknowledges that as a consequence of being a distributor of the
Products, certain confidential information may be disclosed to it by Supplier,
including without limitation technical information and business information
(collectively the "Supplier Confidential Information"). Distributor acknowledges
that such Supplier Confidential Information shall be

<PAGE>
                                     - 22 -

and remain solely the property of Supplier and agrees and covenants that during
the term of this Agreement and within three (3) years after its termination:

         (a)      such Supplier Confidential Information shall be kept
                  confidential and secret; and

         (b)      neither Distributor nor any individuals associated with
                  Distributor in any capacity, whether as directors, officers,
                  agents, employees or otherwise, shall use such Supplier
                  Confidential Information for any purpose or disclose such
                  Supplier Confidential Information to any third person, except
                  to the extent such Supplier Confidential Information must
                  necessarily be used for the performance of this Agreement or
                  is disclosed with the prior written consent of Supplier.

The foregoing restrictions on disclosure and use will not apply to (a)
information which Distributor can prove was previously known to it, (b)
information lawfully received by Distributor from a third party without
obligation of confidentiality, (c) information which becomes known to the public
other than by a disclosure prohibited by this Article.

10.2     CONFIDENTIALITY OF SUPPLIER

Supplier acknowledges that as a consequence of being a supplier of the Products
to Distributor, certain confidential information may be disclosed to it by
Distributor, including without limitation technical information and business
information (collectively the "Distributor Confidential Information"). Supplier
acknowledges that such Distributor Confidential Information shall be and remain
solely the property of Distributor and agrees and covenants that during the Term
of this Agreement and within three (3) years after its termination:

         (a)      such Distributor Confidential Information shall be kept
                  confidential and secret; and

         (b)      neither Supplier nor any individuals associated with Supplier
                  in any capacity, whether as directors, officers, agents,
                  employees or otherwise, shall use such Distributor
                  Confidential Information for any purpose or disclose such
                  Distributor Confidential Information to any third person,
                  except to the extent such Distributor Confidential Information
                  must necessarily be used for the performance of this Agreement
                  or is disclosed with the prior written consent of Distributor.

<PAGE>
                                     - 23 -

The foregoing restrictions on disclosure and use will not apply to (a)
information which Supplier can prove was previously known to it, (b) information
lawfully received by Supplier from a third party without obligation of
confidentiality, (c) information which becomes known to the public other than by
a disclosure prohibited by this Article.

10.3     DISPUTE RESOLUTION

All disputes arising out of this Agreement shall be submitted to final and
binding arbitration. If the respondent in such arbitration is Distributor, the
arbitration shall be held in Tokyo, Japan in accordance with the rules of the
Japan Commercial Arbitration Association. If the respondent is Supplier, the
arbitration shall be held in the Toronto, Ontario, Canada in accordance with the
Rules of Conciliation and Arbitration of the International Chamber of Commerce.

10.4     FORCE MAJEURE

Neither party shall be responsible to the other for non-performance or delay in
performance (other than any payment of money) occasioned by any causes beyond
its control including without limitation acts or omissions of the other party,
acts of civil or military authority, strikes, lock-outs, embargoes,
insurrections or Acts of God. If any such delay occurs, any applicable time
period shall be automatically extended for a period equal to the time lost
provided that the party affected makes reasonable efforts to promptly correct
the reason for such delay and gives to the other party prompt Notice of any such
delay. Such Notice shall include an estimate of the time that will be taken to
correct the reason for such delay.

10.5     ASSIGNMENT

This Agreement is not assignable by either party, either directly or indirectly,
without the prior written consent of the other party, which consent shall not be
unreasonably withheld.

10.6     SUCCESSORS AND ASSIGNS

This Agreement shall enure to the benefit of and be binding upon Distributor and
Supplier and their respective successors and permitted assigns.

<PAGE>
                                     - 24 -

10.7     CONFORMITY WITH LOCAL LAWS

         (a)      The rights and obligations of the parties under this Agreement
                  shall be subject to all applicable laws, orders, regulations,
                  directions, restrictions and limitations of the governments
                  having jurisdiction of the parties. In the event, however,
                  that any law, order, regulation, direction, restriction or
                  limitation, expropriation, seizure or interpretation thereof
                  shall in the judgment of either party substantially alter the
                  relationship between the parties under this Agreement, or the
                  advantages derived from such relationship, either party may
                  request the other party to modify this Agreement, and if,
                  within fifteen days subsequent to making such request, the
                  parties are unable to agree upon a mutually satisfactory
                  modification of this Agreement, then the adversely affected
                  party may terminate this Agreement on fifteen days' notice
                  given to the other party, not later than thirty days following
                  the end of such thirty-day period.

         (b)      Any provision or provisions of this Agreement which in any way
                  contravene the law of any state or country in which this
                  Agreement is effective, shall in such state or country, to the
                  extent of such contravention of law, be deemed severable and
                  shall not affect any other provision or provisions of this
                  Agreement.

         (c)      The parties shall each at its own expense in its own
                  countries, take such steps as may be required to satisfy the
                  laws and requirements of the respective countries with respect
                  to declaring, recording, or otherwise rendering this Agreement
                  valid.

10.8     LANGUAGE

         (a)      Upon execution, this Agreement may be translated into the
                  language of the Territory provided, however, that in the event
                  of any diversion between the English version and any other
                  version, the English version shall prevail.

         (b)      When a comparison of the authentic text of a provision of the
                  United Nations Convention on Contracts for the International
                  Sale of Goods reveals a difference

<PAGE>
                                     - 25 -

                  of meaning that cannot be reconciled by looking to the object
                  and purpose of the Convention provision, the English language
                  version shall prevail.

         (c)      The rights and obligations of the parties under this Agreement
                  shall be governed by the authentic English-language text of
                  the United Nations Convention on Contracts for the
                  International Sale of Goods to the exclusion of the other
                  authentic language versions.

10.9     TRADE TERMS

Trade terms shall where appropriate, and where not inconsistent with the
provisions of this Agreement, be interpreted in accordance with the current
International Rules for the Interpretation of Trade Terms of the International
Chamber of Commerce ("Incoterms") in force on the date of this Agreement.

10.10    CURRENCY

Unless otherwise specifically provided in this Agreement, all references to
dollar amounts or other money amount are expressed in terms of lawful money of
the United States of America.

10.11    SURVIVAL

All obligations of Distributor and Supplier including obligations of indemnity
which expressly or by their nature survive the termination or assignment of this
Agreement shall continue in full force and effect subsequent to and
notwithstanding such termination or assignment and until they are satisfied or
by their nature expire.

10.12    NOTICE

All written notices, consents and approvals (herein referred to as a "Notice")
permitted or required to be given hereunder shall be deemed to be sufficiently
and duly given if written and delivered personally or if transmitted by
facsimile transmission or other form of recorded communication tested prior to
transmission, if to Supplier addressed as follows:

                  HYDROGENICS CORPORATION
                  5985 McLaughlin Road

<PAGE>
                                     - 26 -

                  Mississauga, Ontario
                  CANADA, L5R 1B8

                  Attention: Boyd Taylor, Vice President, Sales and Marketing

                  Fax:       (905) 361-3626

and if to Distributor addressed as follows:

                  TOYOTA TSUSHO CORPORATION
                  Toyota Bldg.
                  7-23, Meikei 4-Chome
                  Nakamura-Ku, Nagoya,
                  450-8575 JAPAN

                  Attention: Mr. Nemoto, Manager, Machinery & Multimedia
                             Planning Division

                  Fax        (052) 584-5806

Any Notice so given or made shall be deemed to have been given or made and
received on the date of delivery or on the day of transmission by facsimile
transmission or other form of recorded communication, as the case may be. Any
party from time to time by Notice may change its address for the purpose of this
Agreement.

10.13    CUMULATIVE RIGHTS

The rights of Distributor and Supplier hereunder are cumulative and no exercise
or enforcement by Distributor or Supplier of any right or remedy hereunder shall
preclude the exercise or enforcement by Distributor or Supplier of any other
right or remedy hereunder of which Distributor or Supplier is otherwise entitled
by law to enforce.

10.14    FURTHER ASSURANCES

The parties agree to do or cause to be done all acts or things necessary to
implement and carry into effect this Agreement to its full extent.

<PAGE>
                                     - 27 -

IN WITNESS OF WHICH the parties have duly executed this Agreement.

                                         HYDROGENICS CORPORATION

                                         By: /s/ PIERRE RIVARD
                                             -----------------------------------
                                             Name:  Pierre Rivard
                                             Title: President and CEO

                                         TOYOTA TSUSHU CORPORATION

                                         By: /s/ MASANORI YAMASE
                                             -----------------------------------
                                             Name:  Masanori Yamase
                                             Title: Director<PAGE>

                                                                    EXHIBIT 4.27

                             HYDROGENICS CORPORATION

                                     - AND -

                           GENERAL MOTORS CORPORATION

--------------------------------------------------------------------------------

                          CORPORATE ALLIANCE AGREEMENT

                                OCTOBER 16, 2001

--------------------------------------------------------------------------------

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                               PAGE
                                                                                                               ----
<S>                                                                                                             <C>
ARTICLE 1
         DEFINITIONS AND INTERPRETATION..........................................................................1
         1.1      Definitions....................................................................................1
         1.2      Materiality of Recitals........................................................................2

ARTICLE 2
         REPRESENTATIONS AND WARRANTIES..........................................................................3
         2.1      Representations and Warranties of GM...........................................................3
         2.2      Representations and Warranties of HYG..........................................................3

ARTICLE 3
         OBLIGATIONS OF THE PARTIES..............................................................................3
         3.1      Obligations of GM..............................................................................3
         3.2      Obligations of HYG.............................................................................4

ARTICLE 4
         BUSINESS DEVELOPMENT ACTIVITIES.........................................................................5
         4.1      Joint Efforts..................................................................................5
         4.2      Funded Research and Development................................................................5
         4.3      Business Team..................................................................................5
         4.4      Joint Communication Strategy...................................................................6
         4.5      Utilization....................................................................................6

ARTICLE 5
         TECHNOLOGY DEVELOPMENT ACTIVITIES.......................................................................6
         5.1      Technology Team................................................................................6
         5.2      Technology Team Responsibilities...............................................................6

ARTICLE 6
         TERM OF AGREEMENT; TERMINATION..........................................................................7
         6.1      Term...........................................................................................7
         6.2      Termination by Mutual Consent..................................................................7
         6.3      Termination for Cause..........................................................................7
         6.4      Effect of Termination..........................................................................7
         6.5      Insolvency.....................................................................................8
         6.6      Other Rights of Termination....................................................................8
         6.7      Survival of Clauses............................................................................8

ARTICLE 7
         RIGHT OF FIRST REFUSAL..................................................................................9
         7.1      GM's Right of First Refusal....................................................................9
         7.2      Transfer Period................................................................................9
         7.3      Valuation of Property..........................................................................9
</TABLE>

                                      -i-

<PAGE>
                               TABLE OF CONTENTS
                                  (continued)

<TABLE>
<CAPTION>
                                                                                                               PAGE
                                                                                                               ----
<S>                                                                                                             <C>
ARTICLE 8
         RIGHT TO PURCHASE......................................................................................10
         8.1      Right to Purchase.............................................................................10
         8.2      Determination of Fair Market Value of the IP..................................................10
         8.3      Exercise of Right.............................................................................10
         8.4      Right to Purchase in Event of Insolvency......................................................10

ARTICLE 9
         DISPUTE RESOLUTION.....................................................................................11
         9.1      Dispute Resolution............................................................................11
         9.2      Arbitration...................................................................................11

ARTICLE 10
         CONFIDENTIALITY........................................................................................12
         10.1     Confidentiality...............................................................................12
         10.2     Technical Information.........................................................................12
         10.3     Business and Financial Information............................................................12

ARTICLE 11
         NOTICES................................................................................................12
         11.1     Notices.......................................................................................12

ARTICLE 12
         MISCELLANEOUS..........................................................................................13
         12.1     Financial Records.............................................................................13
         12.2     Governing Law.................................................................................13
         12.3     Attorneys' Fees...............................................................................13
         12.4     Waiver........................................................................................14
         12.5     Assignment....................................................................................14
         12.6     Captions......................................................................................14
         12.7     Severability..................................................................................14
         12.8     Order of Precedence...........................................................................14
         12.9     Independent Contractors.......................................................................14
         12.10    Force Majeure.................................................................................15
         12.11    Counterparts..................................................................................15
         12.12    Entire Agreement..............................................................................15
</TABLE>

                                      -ii-

<PAGE>

                          CORPORATE ALLIANCE AGREEMENT

THIS CORPORATE ALLIANCE AGREEMENT ("AGREEMENT") is entered into on October 16,
2001, by and between Hydrogenics Corporation ("HYG"), a corporation incorporated
under the laws of Canada, and General Motors Corporation, a Delaware corporation
("GM") (each, a "PARTY," and collectively, the "PARTIES").

                                    RECITALS

A.       HYG designs develops and manufactures test systems and subsystems,
         power systems and stacks for fuel cell applications, for use in
         transportation, mobile, stationary, portable and infrastructure
         applications.

B.       In addition to designing, developing, testing, and manufacturing the
         foregoing systems and subsystems, HYG has the capability of integrating
         them into fuel cell applications and providing installation, customer
         service and customer support services.

C.       GM designs and develops, among other things, PEM fuel cell stacks,
         other fuel cell system components and fuel cell subsystems for use in
         transportation, mobile, stationary, portable and infrastructure
         applications.

D.       The Parties desire to enter into a long-term relationship concerning
         fuel cell stack technology and its worldwide commercialization for
         defined applications. The Parties share a joint vision to commercialize
         PEM fuel cell stacks to accelerate the development of advanced energy
         and propulsion systems and support the global introduction of fuel cell
         vehicles and fuel cell power systems. The relationship is intended to
         include an equity interest by GM in HYG, co-operative marketing and
         branding efforts, joint communications strategies and product
         development, all concerning PEM fuel cell stack engineering,
         engineering services, prototyping, testing and associated equipment,
         field testing and shared learnings, and light manufacturing.

E.       Concurrently with and as a condition to entering into this Agreement,
         the Parties are entering into an equity subscription agreement (the
         "SUBSCRIPTION AGREEMENT"), a shareholder governance agreement (the
         "GOVERNANCE AGREEMENT"), and an intellectual property agreement (the
         "MASTER INTELLECTUAL PROPERTY AGREEMENT"), executed in each case by the
         Parties on the date hereof.

NOW THEREFORE, in consideration of the mutual obligations and agreements set
forth herein, the Parties agree as follows:

                                   ARTICLE 1
                         DEFINITIONS AND INTERPRETATION

1.1      DEFINITIONS.

All capitalized terms used in this Agreement and not otherwise defined herein
shall have the same meanings specified in the Master Intellectual Property
Agreement. The following terms, as used herein, shall have the meanings ascribed
to them below:

(a)      "AGREEMENT" has the meaning specified in the recitals hereto.

<PAGE>
                                      -2-

(b)      "BREACHING PARTY" has the meaning specified in Section 6.3.

(c)      "BUSINESS TEAM" has the meaning specified in Section 4.3.

(d)      "CONFIDENTIAL INFORMATION" means documents and other tangible items,
         disclosed by one Party to the other Party, and which comply with
         ARTICLE 10 below and Section 7 of the Master Intellectual Property
         Agreement.

(e)      "CURRENT ACTIVITIES" means the HYG fuel cell activities that are
         identified in Exhibit A.

(f)      "EFFECTIVE DATE" has the meaning specified in Section 6.1.

(g)      "GAPC" means GM's Global Alternative Propulsion Center.

(h)      "INTELLECTUAL PROPERTY FMV" has the meaning specified in Section 8.2.

(i)      "NON-BREACHING PARTY" has the meaning specified in Section 6.3.

(j)      "OFFERED INTELLECTUAL PROPERTIES" has the meaning specified in Section
         7.1.

(k)      "PROGRAM INVENTIONS" means inventions which were conceived, or first
         actually or constructively reduced to practice, as a result of work
         performed as provided for under this Agreement, by employees and/or
         agents of the Parties.

(l)      "PROGRAM PATENTS" means all patents and associated patent applications,
         regardless of country of origin, issue or publication, which cover
         Program Inventions.

(m)      "RESPONDING PARTY" has the meaning specified in Section 12.1.

(n)      "STATEMENT OF WORK" has the meaning specified in Section 4.2.

(o)      "SUPPLEMENTAL AGREEMENT" has the meaning specified in Section 4.3

(p)      "TECHNOLOGY TEAM" has the meaning specified in Section 5.1.

(q)      "TRANSFER" has the meaning specified in Section 7.1.

(r)      "TRANSFER NOTICE" has the meaning specified in Section 7.1.

(s)      "WWP" means GM's Worldwide Purchasing Organization.

1.2      MATERIALITY OF RECITALS.

The Parties hereby acknowledge and agree that the foregoing recitals are
intended to reflect the agreement of the Parties hereto and are deemed to be a
material part of this Agreement.

<PAGE>
                                      -3-

                                   ARTICLE 2
                         REPRESENTATIONS AND WARRANTIES

2.1      REPRESENTATIONS AND WARRANTIES OF GM

GM represents and warrants to HYG (and acknowledges that HYG is relying thereon)
as follows:

         (a)      the GM Licensed Fuel Cell Intellectual Property represents
                  GM's most advanced overall fuel cell stack technology deemed
                  by GM to be ready to be moved from the development laboratory
                  to the stage of engineering development for product
                  application at this time; and,

         (b)      the GM Licensed Fuel Cell Intellectual Property represents the
                  technology in respect of which GM is currently investing, and
                  GM intends to continue to invest, research and development
                  resources in respect of such intellectual property and related
                  fuel cell stack technology, as commercially reasonable.

2.2      REPRESENTATIONS AND WARRANTIES OF HYG

HYG represents and warrants to GM (and acknowledges that GM is relying thereon)
as follows:

         (a)      the HYG Initial Fuel Cell Intellectual Property is currently
                  not encumbered or used as collateral to any extent which would
                  impair the rights of GM under this Agreement, except with
                  respect to certain entitlements of the Government of Canada as
                  disclosed to GM; and,

         (b)      HYG will not simply seek to resell the GM Licensed Fuel Cell
                  Intellectual Property. It is the intention of HYG to enhance
                  the value of the GM Licensed Fuel Cell Intellectual Property
                  by adding its own development, integration and other
                  engineering efforts to improve such technology for use by
                  customers of HYG.

                                   ARTICLE 3
                           OBLIGATIONS OF THE PARTIES

3.1      OBLIGATIONS OF GM

         (a)      Endorsement. GM shall use reasonable efforts to introduce and
                  recommend HYG to its Affiliates, Alliance Partners, major
                  customers and potential customers for GM fuel cell stacks,
                  test equipment and other related equipment.

         (b)      Support. GM shall actively support HYG in the performance of
                  HYG's duties hereunder by:

                  (i)      agreeing to the sharing or exchange of staff and
                           resources in cases to be determined by the Technology
                           Team, and

                  (ii)     providing access to GM's supplier base, as determined
                           by WWP.

<PAGE>
                                      -4-

         (c)      Efficient Pricing. The Parties shall work with one another to
                  determine on a product-by-product basis how best to achieve
                  maximum pricing efficiency with respect to supplier products.

         (d)      Guidance. As part of the collaborative efforts of the Parties
                  under this Agreement, GM shall provide HYG with guidance in
                  the following areas:

                  (i)      evaluation of HYG future technology, testing
                           procedures and general marketing proposals;

                  (ii)     fuel cell system requirements and system and
                           subsystem performance targets;

                  (iii)    evaluation of HYG resource and facility needs; and

                  (iv)     the co-ordination of HYG personnel and research and
                           development programs to maximize synergies with GM's
                           fuel cell development and marketing programs.

3.2      OBLIGATIONS OF HYG

         (a)      GM Access. HYG shall provide GM access to:

                  (i)      fuel cell stack field testing learnings, data, test
                           results, technology improvements and field units;

                  (ii)     HYG's supplier and customer base; and,

                  (iii)    testing resources, including but not limited to,
                           testing equipment, test stands, support material and
                           documentation, at commercial prices to be determined
                           pursuant to Section 3.2(d).

         (b)      Co-ordination. HYG will participate with GM in the
                  co-ordination of HYG personnel and research and development
                  programs, which may include the sharing or exchange of staff
                  and resources.

         (c)      Board Members. GM shall be represented on the board of
                  directors of HYG in accordance with the terms of the
                  Governance Agreement.

         (d)      Pricing. HYG shall grant GM HYG's best customer pricing for
                  all products, material, hardware and resources purchased by
                  GM.

         (e)      Data Sharing. HYG will share with GM data, sufficient in form
                  and substance to permit GM to duplicate the enhancements
                  developed by HYG relative to GM Licensed Fuel Cell
                  Intellectual Property.

<PAGE>
                                      -5-

                                   ARTICLE 4
                         BUSINESS DEVELOPMENT ACTIVITIES

4.1      JOINT EFFORTS

The Parties shall work together to develop testing systems and subsystems for
fuel cells, and to identify additional Activities for applications of GM
Licensed Fuel Cell Intellectual Property.

4.2      RESEARCH AND DEVELOPMENT

GM and HYG shall use their best efforts to develop statements of work for
product research and development (each, a "STATEMENT OF Work") to be performed
by HYG in collaboration with GM, and funded either by GM, by HYG, or jointly.

4.3      BUSINESS TEAM

         (a)      Within thirty calendar days of the Effective Date, each Party
                  shall assign one member to a joint steering team to meet and
                  cooperate to define and manage the efforts associated with
                  this Agreement (the "BUSINESS TEAM"). Each Party shall bear
                  its own costs and expenses related to the Business Team. Each
                  Party may add members to the Business Team at its sole
                  discretion upon written notice to the other Party. However,
                  voting rights in all matters shall be allocated equally, one
                  vote to GM and one vote to HYG, regardless of the number of
                  members. The members shall include business development
                  representatives with sufficient authority and experience to
                  make recommendations with respect to the usefulness,
                  marketability, and all inter-related business development
                  opportunities or any other aspect of fuel cell technology
                  which they deem appropriate. Either Party may replace its
                  designated voting member in its sole discretion upon written
                  notice to the other Party.

         (b)      The Business Team shall identify its terms of reference which
                  shall be consistent with the spirit and intent of this
                  Agreement and promotion of the long-term relationship between
                  the Parties.

         (c)      The Business Team shall, among other things, consider
                  recommendations for changes in the scope of application of the
                  GM Licensed Fuel Cell Intellectual Property and its use in any
                  Future Activities; and, shall develop marketing and
                  co-branding strategies.

         (d)      The Business Team shall consult on a regular basis, regarding:

                  (i)      which, if any, GM Fuel Cell Intellectual Property may
                           be necessary or desirable for GM to license to HYG
                           for use by HYG in connection with Current Activities
                           or Future Activities; and,

                  (ii)     which, if any, GM Licensed Fuel Cell Intellectual
                           Property may be necessary or desirable for GM to
                           license to HYG for use by HYG in connection with
                           Future Activities.

<PAGE>
                                      -6-

                  If the Business Team agrees that any such intellectual
                  property will be licensed to HYG, then the Parties shall enter
                  into a supplemental intellectual property license agreement on
                  terms to be agreed upon by the Parties (each, a "SUPPLEMENTAL
                  AGREEMENT").

         (e)      Failure on the part of the Business Team to reach a unanimous
                  decision on any matter brought before it shall mean that no
                  authorization is granted to go forward with the matter at
                  issue. Notwithstanding the foregoing, the Business Team shall
                  review any request by HYG for additional license rights in
                  good faith and in a manner consistent with the recitals hereto
                  in which the Parties' intended relationship is described.

4.4      JOINT COMMUNICATION STRATEGY

The Parties hereto shall consult and cooperate with each other as to the form
and substance of any press release or other public disclosure related to this
Agreement, the transactions contemplated hereby or the subject matter hereof.
HYG agrees to submit to GM for its prior review and approval any press release
or similar document or disposition designed for public release which mentions
GM. Notwithstanding the foregoing, and subject to the dispute resolution process
set forth in Section 9.1 below, nothing in this Section 4.4 shall be deemed to
prohibit HYG or GM from making any disclosure necessary in order to satisfy such
Party's disclosure obligations imposed by any applicable law.

4.5      UTILIZATION

It is the intention of GM to utilize HYG for, among other things, product
development, engineering, engineering services, prototyping, testing and light
manufacturing, which will be accomplished principally through the issuance of
one or more purchase orders by WWP on behalf of GM, or as otherwise determined
by the Business Team.

                                   ARTICLE 5
                        TECHNOLOGY DEVELOPMENT ACTIVITIES

5.1      TECHNOLOGY TEAM

Within thirty days of the Effective Date, each Party shall assign one member to
a joint technology team to facilitate the management of technical and
engineering issues (the "TECHNOLOGY TEAM"). Each Party shall bear its own costs
and expenses related to the Technology Team. Each Party may add members to the
Technology Team at its sole discretion upon written notice to the other Party.
The Technology Team shall include technical and engineering representatives with
sufficient authority and experience to deal effectively with issues pertaining
to the design, modification, improvements, and applications of the GM Licensed
Fuel Cell Intellectual Property or any other aspect of the fuel cell technology
which the Technology Team members deem appropriate. Either Party may replace its
member in its sole discretion upon written notice to the other Party.

5.2      TECHNOLOGY TEAM RESPONSIBILITIES

The Technology Team's responsibilities shall include, but not be limited to, the
following:

<PAGE>
                                      -7-

         (a)      providing input into planning and co-ordinating the activities
                  under the Statements of Work to most effectively advance the
                  commercialization of fuel cell stack technology;

         (b)      co-ordinating the execution of the activities under the
                  Statements of Work so as to complement the GM strategic
                  business and technical objectives;

         (c)      co-ordinating the allocation of HYG and GM personnel and
                  resources, which may include the sharing or exchange of staff
                  and equipment, to support completion of the activities under
                  the Statements of Work;

         (d)      reviewing all records of invention derived from the activities
                  under the Statements of Work; and

         (e)      administering the development, preparation, and
                  display/demonstration of prototype hardware.

From time to time, the Technology Team may be assigned additional
responsibilities by the Business Team.

                                   ARTICLE 6
                         TERM OF AGREEMENT; TERMINATION

6.1      TERM

This Agreement will become effective on the date signed by the Parties (the
"EFFECTIVE DATE"), and will remain in effect thereafter until terminated
pursuant to the provisions of this ARTICLE 6.

6.2      TERMINATION BY MUTUAL CONSENT

This Agreement may be terminated at any time by mutual consent of the Parties.

6.3      TERMINATION FOR CAUSE

Either Party (the "NON-BREACHING PARTY") may terminate this Agreement in the
event of a material breach by the other Party (the "BREACHING PARTY"), provided
the Non-Breaching Party first serves written notice of the breach on the
Breaching Party and the Breaching Party has not cured such breach within a
period of sixty calendar days following receipt of the notice.

6.4      EFFECT OF TERMINATION

In the event of termination of this Agreement, both Parties shall retain each of
their respective rights, properties and interests acquired pursuant to the
Agreement, including, but not limited to the following:

         (a)      GM shall retain all rights granted to it by HYG pursuant to
                  the Subscription Agreement;

<PAGE>
                                      -8-

         (b)      the Parties shall each retain all applicable license rights to
                  the other's Program Inventions and Program Patents granted or
                  applied for by such other Party up to the date of termination
                  of this Agreement; and,

         (c)      the Parties shall each retain such rights as are granted
                  pursuant to this Agreement, the Master Intellectual Property
                  Agreement, and any and all Supplemental Agreements the
                  provisions of which are intended to survive the expiration or
                  termination of such agreements.

6.5      INSOLVENCY

In the event that either Party becomes insolvent or suspends its business, or
shall file a voluntary petition or makes any answer admitting the jurisdiction
of the court and the material allegations of, or shall consent to, an
involuntary petition pursuant to, or purporting to be pursuant to, any
reorganization or insolvency law of any jurisdiction, or shall make an
assignment for the benefit of creditors, or shall apply for or consent to the
appointment of a receiver or trustee of all or a substantial part of its
property (such Party, upon the occurrence of such an event, a "Bankrupt Party"),
and if such proceeding is not terminated within sixty days of such a filing,
then to the extent permitted by law, the other Party hereto may immediately
terminate this Agreement by giving written notice of termination to the Bankrupt
Party.

6.6      OTHER RIGHTS OF TERMINATION

         (a)      In the event that GM disposes of any of its shares of HYG in
                  contravention of the provisions of the Governance Agreement,
                  this Agreement may be terminated by HYG. If HYG desires to
                  exercise its right of termination under this Section 6.6, it
                  will notify GM in writing of its intention to so terminate,
                  whereupon the Agreement will terminate thirty calendar days
                  following receipt by GM of such notice.

         (b)      In the event that GM ceases to hold an equity interest in the
                  stock of HYG, this Agreement will be subject to termination by
                  either Party. A Party wishing to exercise its right of
                  termination under this Section 6.6(b) will notify the other
                  Party in writing of its intention to terminate, and the
                  Agreement will terminate thirty calendar days following
                  receipt of such notice.

6.7      SURVIVAL OF CLAUSES

Notwithstanding anything else contained in this Agreement, the Parties agree
that the following general provisions shall also survive any termination or
expiry of this Agreement: Section 6.4 - Effect of Termination; Section 6.7 -
Survival of Clauses; ARTICLE 9 - Dispute Resolution; ARTICLE 10 -
Confidentiality; ARTICLE 12: Section 12.2 - Governing Law, Section 12.5 -
Assignment, and Section 12.12 - Entire Agreement.

<PAGE>
                                      -9-

                                   ARTICLE 7
                             RIGHT OF FIRST REFUSAL

7.1      GM'S RIGHT OF FIRST REFUSAL

In the event HYG proposes to sell, assign, transfer or otherwise convey (the
"TRANSFER") all or part of HYG's interest in the GM Funded Fuel Cell
Intellectual Property to any third party or parties, then HYG shall offer to GM
the right to purchase such interest (the "OFFERED INTELLECTUAL PROPERTY") on the
same terms (or terms as similar as reasonably possible) and conditions as set
forth in a written notice of the proposed Transfer (the "TRANSFER NOTICE"). The
Transfer Notice shall include (i) a description of the Offered Technology, (ii)
the identity of the prospective transferee(s), (iii) the consideration and the
material terms and conditions upon which the proposed Transfer is to be made,
and (iv) the expected closing date for the Transfer. The Transfer Notice shall
also include a copy of any written proposal, term sheet or letter of intent or
other agreement relating to the proposed Transfer, and HYG shall certify that it
has a good faith belief that a binding agreement for the Transfer is obtainable
on the terms described in, or attached to, the Transfer Notice. Upon written
notice by GM within twenty (20) business days of its receipt of the Transfer
Notice, GM may notify HYG in writing of its desire to purchase the Offered
Technology from HYG at the same price, and upon the same terms (or terms as
similar as reasonably possible) as described in the Transfer Notice, and HYG
shall transfer the Offered Technology to GM pursuant to such terms.

7.2      TRANSFER PERIOD

If the Offered Technology is not purchased by GM pursuant to Section 7.1, HYG
shall be entitled for a period of sixty calendar days thereafter to complete the
proposed Transfer of the Offered Technology upon the terms and conditions
specified in the Transfer Notice. If HYG has not so transferred the Offered
Technology during such period, HYG shall not thereafter make a Transfer of the
Offered Technology without again first offering such assets to GM in the manner
provided in Section 7.1.

7.3      VALUATION OF PROPERTY

Should the purchase price specified in the Transfer Notice be payable in
property other than cash or evidences of indebtedness, GM shall have the right
to pay the purchase price in the form of cash equal in amount to the value of
such property. If HYG and GM cannot agree on such cash value within twenty
business days after GM's receipt of the Transfer Notice and by the time GM
notifies HYG of its intent to purchase the Offered Technology pursuant to
Section 7.1 above, the valuation shall be determined by an independent appraisal
firm selected and approved by HYG and GM, which approval shall not be
unreasonably withheld. The cost of such appraisal shall be borne by GM. The
appraisal shall be completed and the GM purchase closed within thirty (30)
business days thereafter. If the time for the closing of GM's purchase has
expired because the determination of the value of the purchase price offered by
the prospective transferee(s) has not been timely received, then such closing
shall be continued and held on or before the fifth (5th) business day after such
valuation shall have been made pursuant to this Section 7.3.

<PAGE>
                                      -10-

                                   ARTICLE 8
                                RIGHT TO PURCHASE

8.1      RIGHT TO PURCHASE

In the event of any decision by HYG to discontinue the activity in fuel cell
technology or otherwise upon any liquidation, dissolution or winding up of HYG,
whether voluntary or involuntary, HYG shall give notice to GM of such decision,
and GM shall have the right to purchase HYG's interest in the GM Funded Fuel
Cell Intellectual Property, on the terms and conditions approved by HYG's board
of directors in accordance with the provisions of Section 8.2 below.

8.2      DETERMINATION OF FAIR MARKET VALUE OF THE IP

The Parties hereby agree that the fair market value of such interest (the
"INTELLECTUAL PROPERTY FMV") shall be determined by an independent appraisal
firm with proven expertise in the field of valuation of intellectual property
chosen and paid for by GM and approved by HYG's board of directors, which
approval shall not be unreasonably withheld. Such valuation shall be binding
upon the Parties with regard to the exercise of GM's right to purchase under
this ARTICLE 8.

8.3      EXERCISE OF RIGHT

         (a)      In order properly to exercise its right to purchase hereunder,
                  GM shall have ten business days after determination of the
                  Intellectual Property FMV to decide whether to purchase such
                  interest and, if it decides to do so, the transaction shall
                  close within an additional twenty business days subject to the
                  requirement for any regulatory, judicial or other third party
                  approvals.

         (b)      If GM does not purchase HYG's interest in the GM Funded Fuel
                  Cell Intellectual Property as provided herein, HYG shall be
                  entitled to discontinue its activities in the fuel cell area.

         (c)      Notwithstanding the foregoing, if the proposal by HYG to
                  discontinue its activities in the fuel cell area has not
                  commenced within ninety calendar days of GM's refusal to
                  purchase HYG's interest in the GM Funded Fuel Cell
                  Intellectual Property, GM's rights under this Article 8 shall
                  be revived.

8.4      RIGHT TO PURCHASE IN EVENT OF INSOLVENCY

In the event HYG is deemed by a court of competent jurisdiction to be insolvent,
either (a) because the sum of its debts is greater than all of its property at
fair valuation; (b) because it is unable to pay its debts as they become due;
and/or (c) because it is the subject of a voluntary or involuntary petition
under the Canadian Companies Creditors Arrangement Act or the United States
Bankruptcy Code (11 U.S.C. Sections 101 et seq.) which is not dismissed within
sixty calendar days, or the subject of an assignment for benefit of creditors,
receivership, service of a writ of attachment or replevin with respect to a
material part of its property, or the subject of an appointment of a custodian,
keeper, conservator or trustee over HYG or part or all of its assets, or the
subject of a regulatory seizure, conservatorship or receivership or foreclosure
of a material part of its property, then GM shall be given the opportunity to
purchase HYG's interest in the

<PAGE>
                                      -11-

GM Funded Fuel Cell Intellectual Property, subject to all necessary or
appropriate regulatory and judicial approvals, at the value as determined in
accordance with the applicable and appropriate regulatory and/or judicial
procedures.

                                   ARTICLE 9
                               DISPUTE RESOLUTION

9.1      DISPUTE RESOLUTION

Any and all disputes arising out of or in connection with this Agreement, the
Subscription Agreement, the Governance Agreement, the Master Intellectual
Property Agreement and/or any and all Supplemental Agreements, which cannot be
resolved by the Business Team must be negotiated in good faith by the senior
executive officers of GM and HYG with a view to achieving a reasonable
resolution of such issue.

9.2      ARBITRATION

         (a)      Any and all disputes arising out of or related to this
                  Agreement, the Subscription Agreement, the Governance
                  Agreement, the Master Intellectual Property Agreement and/or
                  any and all Supplemental Agreements, and which are not
                  resolved in accordance with Section 9.1 hereof, shall be
                  finally settled by arbitration in accordance with the rules of
                  the American Arbitration Association by a panel of three
                  arbitrators.

         (b)      With respect to arbitration initiated by HYG, the arbitration
                  will be held in Rochester, New York (or such other venue as
                  mutually agreed by the Parties), on consecutive business days.

         (c)      With respect to arbitration initiated by GM, the arbitration
                  will be held in Toronto, Ontario (or such other venue as
                  mutually agreed by the Parties), on consecutive business days.

         (d)      The award rendered by the arbiter shall be final and binding
                  upon the Parties. Judgment on any award may be entered in any
                  court having jurisdiction over the Parties or their assets.

         (e)      The costs of the arbitration shall be shared equally by the
                  Parties. Each Party will pay its own attorneys' fees and
                  costs.

         (f)      Notwithstanding anything to the contrary contained in this
                  Section 9.2, to the extent any claims relate to the validity,
                  construction, scope, enforceability or infringement of any
                  patent rights, such claim shall not be required to be
                  submitted to arbitration hereunder and shall be resolved by a
                  U.S. court of competent jurisdiction.

<PAGE>
                                      -12-

                                   ARTICLE 10
                                 CONFIDENTIALITY

10.1     CONFIDENTIALITY

Each Party agrees that the terms and conditions of this Agreement shall be
treated as confidential and that neither Party will disclose the terms or
conditions of this Agreement to any Third Party without prior written consent of
the other Party, provided, however, that each Party may disclose the terms and
conditions of this Agreement, to the extent necessary: (a) as required by any
court or other governmental agency; (b) as required by law; (c) in confidence to
legal counsel of the Parties, accountants, and other professional advisors; (d)
in confidence, to banks, investors and other financing sources and their
advisors; (e) in connection with the enforcement of this Agreement or rights
under this Agreement; or (f) in confidence, in connection with an actual or
prospective merger or acquisition or similar transaction. With respect to
disclosure of the terms and conditions of this Agreement or of any materials
subject to Section 4.4 of this Agreement, required by a court or governmental
order, the disclosing Party shall provide prior notification of such impending
disclosure to the non-disclosing Party. All reasonable efforts to preserve the
confidentiality of the terms of this Agreement shall be expended by the
disclosing Party in complying with such an order, including obtaining a
protective order to the extent reasonably possible. Any SEC filings required by
law shall be made after any sensitive information in the Agreement has been
accorded confidential protection under applicable SEC rules and regulations.

10.2     TECHNICAL INFORMATION

The confidentiality terms applicable to technical information exchanged or
transferred by the Parties are contained in Section 7 of the Intellectual
Property Agreement.

10.3     BUSINESS AND FINANCIAL INFORMATION

Financial information and other commercially sensitive information exchanged by
the Parties, orally or in documentary form, will be protected by the Parties to
the same extent that their own commercially sensitive information is protected
from disclosure and use by Third Parties.

                                   ARTICLE 11
                                     NOTICES

11.1     NOTICES

All notices, requests, consents, approvals, waivers and other communications
hereunder shall be deemed to have been duly given and made if in English, and if
served by personal delivery upon the party for whom they are intended, if
delivered by registered or certified mail, return receipt requested, or by a
national courier service, of if sent by facsimile, provided that the facsimile
is promptly confirmed by telephone confirmation thereof, to the person at the
address set forth below, or such other address as may be designated in writing
hereafter, in the same manner, by such person and shall be effective upon
receipt.

<PAGE>
                                      -13-

         If to HYG:                 Hydrogenics Corporation
                                    5985 McLaughlin Road
                                    Mississauga, Ontario
                                    Canada
                                    Attn:  Pierre Rivard - President and CEO
                                    Phone:  905-361-3660
                                    Facsimile:  905-361-3626

         with a copy to:            Osler, Hoskin and Harcourt LLP
                                    Box 50, 1 First Canadian Place
                                    Toronto, Ontario
                                    Canada   M5X 1B8
                                    Attn:  Mark Trachuk
                                    Phone:  416-862-4749
                                    Facsimile:  416-862-6666

         If to GM:                  General Motors Corporation
                                    300 Renaissance Center
                                    P.O. Box 300
                                    Detroit, MI 48265-3000
                                    MC  482-625-D81
                                    Facsimile:  313-667-3188
                                    Attn:  General Counsel

Any Party may change its address for purposes of this Article by giving the
other Party written notice of the new address in the manner set forth above.

                                   ARTICLE 12
                                  MISCELLANEOUS

12.1     FINANCIAL RECORDS

Each Party will maintain appropriate financial and other records pertaining to
the intellectual property licenses, the contract work, and other aspects of the
relationship defined by this Agreement and the other agreements signed
concurrently.

12.2     GOVERNING LAW

         (a)      This Agreement shall be governed by New York law, excluding
                  its conflict of laws rules.

         (b)      The Parties expressly disclaim the application of the United
                  Nations Convention on the International Sale of Goods to this
                  Agreement.

12.3     ATTORNEYS' FEES

In the event of any action, suit or proceeding, including arbitration, between
the Parties hereto, each Party shall be responsible for its own costs and
attorneys' fees.

<PAGE>
                                      -14-

12.4     WAIVER

The delay or failure of a Party to exercise any right, power, remedy, or
privilege hereunder or failure to strictly enforce any breach, violation,
default, provision or condition shall not impair any such right, power, remedy
or privilege nor shall it constitute a waiver thereof or acquiescence thereto.
Any waiver, permit, consent, or approval of any kind regarding any breach,
violation, default, provision or condition of this Agreement must be in writing
and shall be effective only to the extent specifically set forth in such
writing. No partial waiver of any such right, power, privilege, breach,
violation, default, provision, or condition on any one occasion shall preclude
any other or further exercise thereof or constitute a waiver thereof or
acquiescence thereto on any subsequent occasion unless clear and express notice
thereof in writing is provided.

12.5     ASSIGNMENT

This Agreement shall not be assigned by either Party without the prior written
approval of the other Party.

12.6     CAPTIONS

All Section captions and headings are for reference only and shall not be
considered in interpreting or construing this Agreement.

12.7     SEVERABILITY

If any provision or portion of this Agreement is held to be unenforceable or
invalid, the Parties agree to negotiate, in good faith, a substitute valid
provision which most nearly effects the Parties' intent in entering into this
Agreement. In either case, the remaining provisions of this Agreement shall
remain in full force and effect.

12.8     ORDER OF PRECEDENCE

The terms of this Agreement, and those of the Subscription Agreement and the
Master Intellectual Property Agreement, shall supersede the pre-printed terms
and conditions appearing on the reverse side of any purchase order that may be
issued by GM. In the event of any conflict in terms, the following order of
precedence shall govern:

         (a)      The terms of this Agreement, the Subscription Agreement, the
                  Governance Agreement or Master Intellectual Property
                  Agreement, as appropriate;

         (b)      The Statements of Work;

         (c)      The terms appearing on the face of any purchase order; and,

         (d)      The terms appearing on the reverse side of any purchase order.

12.9     INDEPENDENT CONTRACTORS

The Parties are each independent contractors and neither Party shall be, nor
represent itself to be, the franchiser, joint venturer, franchisee, partner,
broker, employee, servant, agent, or legal

<PAGE>
                                      -15-

representative of the other Party for any purpose whatsoever. Neither Party is
granted any right or authority to assume or create any obligation or
responsibility, express or implied, on behalf of or in the name of the other
Party, or bind the other Party in any matter or thing whatsoever, including but
not limited to, the right or authority to obligate the other Party to accept or
deliver any order, or to sell or refuse to sell to any potential customer.

12.10    FORCE MAJEURE

No Party to this Agreement shall be liable to the other Party for any loss,
injury, delay, damage or other casualty suffered or incurred by such other Party
due to strikes, lockouts, accidents, fire, delays in manufacture, transportation
or delivery of material, embargoes, inability to ship, explosions, floods, war,
governmental action or any other cause similar thereto which is beyond the
reasonable control of such other Party and any failure or delay by a Party in
the performance of any of its obligations under this Agreement shall not be
considered as a breach of this Agreement due to, but only so long as there
exists, one or more of the foregoing causes. In the event the work cannot be
resumed within a reasonable period the Parties will agree on an equitable
resolution of all issues.

12.11    COUNTERPARTS

This Agreement may be executed in one or more counterparts, each of which shall
constitute an original, but taken together shall constitute one and the same
document.

12.12    ENTIRE AGREEMENT

This Agreement and the other agreements, documents, exhibits, and writings
attached and/or executed and delivered pursuant hereto or concurrently herewith,
including without limitation, the Subscription Agreement, and the Master
Intellectual Property Agreement, contain and constitute the sole, complete and
entire agreement and understanding of the Parties concerning the matters
contained herein and therein and may not be altered, modified or changed in any
manner except by writing duly executed by the Parties. No statements, promises
or representations have been made by any Party to another, or are relied upon,
and no consideration has been or is offered promised, expected or held out,
other than as stated in this Agreement or the other agreements and documents
referenced herein. No Party is relying on any representations other than those
expressly set forth herein or therein. No conditions precedent to the
effectiveness of this Agreement exist, other than as may be expressly provided
herein.

IN WITNESS WHEREOF, the Parties to this Agreement have duly executed it as of
the day and year first above written.

<TABLE>
<S>                                                         <C>
HYDROGENICS CORPORATION, a Canadian corporation             GENERAL MOTORS CORPORATION, a Delaware corporation

      By:  /s/ PIERRE RIVARD                                  By:  /s/ LAWRENCE D. BURNS
           ------------------------------------------              ---------------------------------------------------
           Name:    Pierre Rivard                                  Name:    Lawrence D. Burns
           Title:   President and CEO                              Title:   Vice President, GM Research &
                                                                            Development and Planning

</TABLE>

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