Document:

Exhibit 10.25
                                LICENSE AGREEMENT

         THIS LICENSE  AGREEMENT (the "Agreement") is made by and among Balantum
Oy  ("Newco"),  a  Finnish  corporation  having  a  place  of  business  at  c/o
Asianajotoimisto  Waselius  & Wist  Oy,  Etelaesplanadi  24 A,  00130  Helsinki,
Finland,  Aquamax (International) Holding B.V. ("Aquamax"),  a Dutch corporation
having  a  place  of  business  at  Locatellikade  1,  Parnassustoren,  1076  AZ
Amsterdam,  P.O.  Box  7215,  1070 AE  Amsterdam,  The  Netherlands  and  Keeran
Corporation N.V.  ("Keeran"),  a Netherlands Antilles corporation having a place
of business at World Trade Center  Curacao,  Unit  BC.II.01-04,  Piscadera  Bay,
Willemstad,  Curaco, Netherlands Antilles (collectively,  Aquamax and Keeran are
referred to as "AK"). Newco, Aquamax,  Keeran and, depending on the context, AK,
may each be referred to herein as a "Party" and collectively as the "Parties."

         WHEREAS, Newco is the owner of the Newco Technology (as defined below);
and

         WHEREAS,  AK desires to obtain a license to make, use and sell Licensed
Products (as defined below) under the terms and conditions of this Agreement.

         NOW,  THEREFORE,  in consideration of the mutual covenants and promises
made in this Agreement and other  consideration,  the receipt and sufficiency of
which is hereby acknowledged, the Parties, intending to be legally bound by this
Agreement, agree to the following terms and conditions:

1.       DEFINITIONS

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

         1.1  "Affiliate(s)"  of a Party means any  corporation,  partnership or
other  individual or entity that directly or indirectly:  (i) owns fifty percent
(50%) or more of the voting stock or equity of the Party;  (ii) is owned,  fifty
percent  (50%)  or more of the  voting  stock or  equity,  by the  Party;  (iii)
otherwise controls the Party; or (iv) is otherwise controlled by the Party.

         1.2. "Closing Date" means the "Completion Date" as that term is defined
in  paragraph  6.1 of that  certain  Asset  Purchase  Agreement  by and  between
Assignee and Hackman Technology Oy, Ltd., dated 20 July, 2001.

         1.3  "Confidential  Information"  means any information  disclosed to a
Party that is confidential,  including, without limitation, all ideas, concepts,
structures,   specifications,   documentation,  designs,  techniques,  drawings,
hardware, software, data, prototypes,  processes,  technology, know-how, methods
of design and/or  development,  inventions,  and/or other  technical,  business,
marketing,  planning  information and/or data regardless of how such information
is transmitted (including orally, and/or in documentary and/or  machine-readable
form,  and/or in the form of samples from which the  information may be derived)
that if disclosed in tangible form, is marked "Confidential,"  "Proprietary," or
if disclosed orally, is stated by the Disclosing Party to be confidential, or is
of such a nature that the Receiving Party in the exercise of reasonable business
judgment should know is confidential.

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         1.4 "Disclosing Party" means the Party whose  Confidential  Information
is revealed to, and/or  learned by, the Receiving  Party and/or its employees or
agents under this Agreement.

         1.5 "Field of Use" means those applications of the Newco Technology, as
said technology  existed as of the Effective Date,  that: (1) have as their sole
purpose the desalination of seawater; and (2) are not capable of processing more
than 1,000 cubic meters of seawater per day.

         1.6 "Improvements"  means any Technical  Information  pertaining to the
Newco Technology developed after the Effective Date.

         1.7  "Licensed  Product(s)"  means any  products  practicing  the Newco
Technology within the Field of Use.

         1.8 "Newco  Patents"  means any  Patents  listed on  Schedule A and any
Patents arising out of any Improvements during the term of this Agreement.

         1.9 "Newco  Technology"  means (i) the Patents  listed on Schedule A of
this  Agreement  and (ii) any  Improvements  to (i) made during the term of this
Agreement,  including  any and all  Patents  arising  out of such  Improvements.
Schedule A may be supplemented and revised by Newco from time to time to reflect
any changes to the list of Patents included in the Newco  Technology  during the
term of this Agreement.

         1.10 "Patent(s)" means patents,  patent applications and utility models
or   their   equivalents,   as  well  as   worldwide   counterparts,   reissues,
continuations,  continuations-in-part  or  divisions  relating to such  patents,
patent applications and utility models.

         1.11  "Receiving  Party"  means  the Party who  receives  or  otherwise
learns,   and/or  whose   employees  or  agents  receive  or  otherwise   learn,
Confidential Information of the Disclosing Party under this Agreement.

         1.12 "Technical  Information" means discoveries,  inventions,  works of
authorship,  trade secrets,  Confidential  Information  and know-how.  Technical
Information  includes,  but  is  not  limited  to,  research,   engineering  and
manufacturing information,  information with respect to environmental and safety
requirements,   analytical  procedures  and  techniques,  operating  procedures,
maintenance  practices,  design  information  on  manufacturing  facilities  and
equipment,  machinery  and  equipment  specifications,   product  test  methods,
drawings, product production processes,  computer files, product information and
other general technical information.

2.       LICENSE GRANTS

         2.1 License.  Subject to the terms and conditions of this Agreement and
to the terms and  conditions of that certain  Co-Operation  and Sales  Agreement
between the Parties  dated 20 July,  2001 Newco  hereby  grants to AK a paid-up,
worldwide  license  under the Newco  Technology  to make,  use and sell Licensed
Products in the Field of Use. The grant made by Newco to AK  hereunder  shall be
exclusive for the five-year period  commencing on the Closing Date, and shall be
non-exclusive thereafter.

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         2.2  Restriction  on Rights.  AK shall not have the right to  transfer,
relicense or sublicense  any rights  granted to it hereunder by Newco in any way
or for any purpose.

3.       PATENT MARKING; MAINTENANCE AND PROSECUTION

         3.1 Marking. AK shall mark all Licensed Products where appropriate with
the applicable patent numbers in a manner sufficient to give proper legal notice
under  the  applicable  patent  laws,  including  notices  in any  documentation
accompanying the Licensed  Products.  Anything in this Agreement to the contrary
notwithstanding,  AK agrees to indemnify  Newco and hold Newco  harmless for any
limitation or diminution of patent damages otherwise recoverable by Newco in any
patent  litigation,  where such  limitation or diminution is attributable to any
failure by AK to mark  Licensed  Products as provided  herein.  The liability of
Aquamax and Keeran hereunder shall be joint and several.

         3.2  Maintenance  and  Prosecution.  Newco will  continue  to  maintain
responsibility  at its  discretion,  for the  filing and  prosecution  of Patent
applications,  and maintenance of the Patents  related to the Newco  Technology,
including Patents Newco may file,  prosecute and maintain at its discretion that
arise out of  Improvements.  AK agrees to  reasonably  cooperate  with  Newco as
necessary  in  connection   with  the  filing  and  prosecution  of  any  Patent
applications that arise out of Improvements by AK.

4.       TERM AND TERMINATION UPON DEFAULT

         4.1 Term. This Agreement is conditional upon and shall enter into force
only on the Closing Date, and shall continue until expiration of the last Patent
listed on Schedule A, as said Schedule  existed as of the Closing  Date,  unless
earlier terminated as provided below.

         4.2 Default.  A Party will be deemed in default under this Agreement if
(i) it becomes insolvent, bankrupt, or any of its assets are seized or placed in
trust for the benefit of creditors and such insolvency, bankruptcy or seizure is
not  dissolved  or cured in sixty  (60) days;  or (ii) it fails to  perform  any
obligation  required of it under this  Agreement  and fails to cure such default
within sixty (60) days after written notice from the other Party.

         4.3 Remedies for Default.  Upon any occasion of default hereunder,  the
non-defaulting  Party may pursue any remedy  available  under this  Agreement or
otherwise,  including without limitation  terminating this Agreement upon notice
to the Party in default.

         4.4 Survival.  The following  Sections and Paragraphs shall survive the
termination of this Agreement: 1, 2.2, 3.1, 4.2, 4.3, 4.4, 5, 6, 7 and 9.

5.       INFRINGEMENT

         5.1  Notice.  Each Party  shall  inform the other  Party  promptly,  in
writing, of any alleged  infringement or claim of invalidity or unenforceability
of any Newco Patent by a third party and of any available evidence thereof.

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         5.2      Suits.

         (a) During the term of this Agreement,  Newco shall have the right, but
shall not be  obligated,  to  prosecute  or defend at its own expense any action
relating  to the Newco  Technology  including,  but not  limited  to, any action
relating to any infringement or claim of invalidity or  unenforceability  of any
Newco Patent.

         (b) Subject to Paragraph 5.3 hereof, the total cost of any action
commenced or defended by a Party or the Parties  shall be borne as follows:  (i)
where the Parties  agree to join  together  to bring or defend the  action,  the
costs shall be shared equally by Newco and AK, and any and all sums collected or
recovered  in  any  such  suit,  whether  by  decree,  judgment,  settlement  or
otherwise,  shall be shared equally by the Parties after accounting for fees and
expenses  borne by each Party;  or (ii) where Newco brings or defends the action
without the agreement from AK to join the action,  all costs will be paid solely
by Newco and any and all sums  collected or recovered in any such suit,  whether
by decree, judgment, settlement or otherwise, shall belong to Newco.

         5.3 Assistance.  In any suit that Newco  individually  may institute or
defend  relating  to the Newco  Technology  including,  but not  limited to, any
action to enforce any Newco Patent pursuant to this Agreement,  AK shall, at the
request of Newco,  cooperate in all respects and, to the extent  possible,  have
its employees and agents  testify when  requested  and make  available  relevant
records, papers, information, samples, specimens, and the like.

6.       REPRESENTATIONS AND WARRANTIES

         6.1 Newco. Newco hereby warrants and represents that:

         (a) it has full  right  and power to grant the  rights,  licenses,  and
privileges herein given;

         (b)  performance  of its  obligations  under this  Agreement  shall not
violate any existing agreement to which it is subject or a party;

         (c) the execution and  performance of this Agreement is within its duly
authorized corporate powers; and

         (d) there are no pending or threatened lawsuits,  proceedings,  claims,
governmental  actions or  investigations of which Newco is aware which could, in
any way, adversely affect its performance of its obligations hereunder or reduce
the value of the rights granted hereunder.

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         6.2 AK. AK,  individually  and together,  hereby  warrant and represent
that:

         (a) they have the full right and power to grant the  rights,  licenses,
and privileges herein given;

         (b)  performance of their  obligations  under this Agreement  shall not
violate any existing agreement to which they are subject or a party;

         (d) the execution  and  performance  of this  Agreement is within their
duly authorized corporate powers; and

         (e) there are no pending or threatened lawsuits,  proceedings,  claims,
governmental  actions or investigations of which AK is aware which could, in any
way,  adversely affect the performance of their obligations  hereunder or reduce
the value of the rights granted hereunder.

         7. CONFIDENTIAL INFORMATION

         7.1 Disclosure.  A Receiving Party may reproduce,  use, and/or disclose
Confidential  Information  only to the extent necessary for the purposes of this
Agreement,  and even then only to those persons who (a) have a "need to know" in
connection  with that  Party's  obligations  under this  Agreement  and (b) have
obligations  to  maintain  the  confidentiality  of such  information  that  are
comparable in scope to those set forth hereunder.

         7.2  Exclusions.   The  following   information  shall  not  be  deemed
Confidential  Information  and shall not be subject to the  restrictions of this
Section 7:

         (a) information  independently developed by the Receiving Party without
the use of any of the Disclosing Party's Confidential Information;

         (b) information  lawfully received free of confidentiality  restriction
from another source having the right to furnish such information;

         (c) information  that is or becomes  generally  available to the public
without breach of this agreement by the Receiving Party;

         (d) information that, at the time of disclosure to the Receiving Party,
was  known  to the  Receiving  Party  free  of  confidentiality  restriction  as
evidenced by documentation in the possession of the Receiving Party; or

         (e) information  that the Disclosing Party agrees in writing is free of
such restrictions.

         7.3  Compliance.  The  prohibitions  on the disclosure of  Confidential
Information  under this Agreement  shall not preclude a Receiving  Party, on the
advice of counsel,  from  complying  with  applicable  law or other demand under
lawful process,  including a discovery request in a civil litigation, so long as
the  Receiving  Party first gives the  Disclosing  Party  notice of the required
disclosure  and  reasonably   cooperates  with  the  Disclosing  Party,  at  the
Disclosing Party's sole expense, in seeking reasonable  protective  arrangements
with respect to such Confidential  Information.  In no event shall the Receiving
Party's  cooperation  with the Disclosing  Party require the Receiving  Party to
take any  action  that,  on the  advice of their  counsel,  could  result in the
imposition of any sanctions or other penalties against them.

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         7.4 Return or  Destruction.  At the  termination  or expiration of this
Agreement,  each Party shall,  upon written request of a Party,  promptly gather
and return or  destroy  all  Confidential  Information  (and any copies  thereof
regardless of the medium of the copies)  disclosed to them by a Disclosing Party
pursuant to this Agreement. This obligation on the part of the Parties to gather
and  return or  destroy  Confidential  Information  extends as well to any other
persons to whom any of them has disclosed  Confidential  Information of a Party.
This  obligation may be discharged by a written  representation  and warranty by
the obligated Party that the  Confidential  Information  required to be gathered
and returned has already been destroyed.

8.       NOTICES

         Any  notice  to be given  by a Party  shall be in  writing  and  served
personally  or by  certified  or  registered  mail,  DHL or  Federal  Express or
equivalent  guaranteed  overnight  courier  services to the address given on the
first  page of this  Agreement.  Notice  to  Newco  shall  be  addressed  to c/o
Asianajotoimisto  Waselius  & Wist  Oy,  Etelaesplanadi  24 A,  00130  Helsinki,
Finland, with a courtesy copy to Edward V. DiLello, Esq., at Darby & Darby P.C.,
805 Third Avenue, New York, New York 10022, United States of America, and notice
to  AK  shall  be  addressed  to:  (1)  Aquamax  (International)  Holding  B.V.,
Locatellikade 1,  Parnassustoren,  1076 AZ Amsterdam,  P.O. Box 75215,  1070 AE,
Amsterdam,  The  Netherlands,  attention:  _________________;   and  (2)  Keeran
Corporation N.V., World Trade Center Curacao,  Unit BC.II.01-04,  Piscadera Bay,
Willemstad, Curacao, Netherlands Antilles, attention: _________________,  with a
courtesy copy to: Dr. Tauno Palotie, Veikko Palotie & Co.,  Aleksanterinkatu 44,
Helsinki,  Finland  00100.  The notice shall  operate and be deemed to have been
given on the date such notice is received.  The Parties  shall notify each other
of any change of their address and any failure to provide such notification that
results in the  prevention  or delay in delivery of any notice of default  shall
not affect the  sufficiency  of service of any notice of  default.  Any delay in
serving a notice of default  shall not be  construed  as a waiver of any default
hereunder.

9.       GENERAL PROVISIONS

         9.1 No Other Rights.  Nothing in this  Agreement  shall be construed as
conferring by implication, estoppel or otherwise any license or other right to a
Party  under  any  Patents,  copyrights,  trade  secrets  or other  intellectual
property  or  industrial  property  other  than the  Newco  Technology,  as said
technology existed as of the Closing Date.

         9.2  Relationship.   Nothing  contained  in  this  Agreement  shall  be
construed  to  place  Newco  and  AK,  or  either  Aquamax  or  Keeran,  in  the
relationship of partners or joint  venturers,  and no Party shall have the power
to obligate, bind, or act as the agent for the other in any manner whatsoever.

         9.3 Disclaimer. Except as provided in Section 6 of this Agreement or as
may  otherwise  be provided in a separate  agreement  between the  Parties,  the
Parties  make no  representation,  extend  no  warranties  of any  kind,  either
express,  implied, or otherwise,  nor assume any responsibilities or liabilities
whatever  with respect to the  manufacture,  use,  importation  or sale by AK or
concerning  products  incorporating  Newco  Technology  or  made  by  use of any
invention or technical information licensed under this Agreement.

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         9.4  Limitation  Of  Liability.  Except as  provided in  paragraph  3.1
hereof,  or as may  otherwise  be provided in a separate  agreement  between the
Parties,  in no event shall the Parties be liable to each other for any special,
consequential,  indirect or incidental damages, however caused, on any theory of
liability whether or not it has been advised of the possibility of such damages,
arising in any way out of this Agreement.

         9.5  Assignment.  Neither this Agreement nor any interest  hereunder is
assignable  in whole or in part;  provided,  however,  that Newco shall have the
option to terminate  this  Agreement upon thirty (30) days' written notice to AK
for any change in ownership of greater  than fifty  percent  (50%) of the equity
ownership of either  Aquamax or Keeran or upon any change in which a controlling
interest  in either  Aquamax  or Keeran is  transferred  to a third  party.  The
Parties  agree that Newco may assign its  interests in this  Agreement to any of
its Affiliates.  Any assignment that is not in accordance with this Paragraph is
null and void.

         9.6 Applicable Law. This Agreement shall be enforced,  governed by, and
construed in accordance with the laws of Finland,  except to the extent that any
rights in United States Patents are licensed  hereunder,  the patent laws of the
United States shall control.

         9.7  Arbitration.  Any dispute,  controversy or claim arising out of or
relating to this  Agreement or the breach,  termination  or  invalidity  thereof
shall  be  settled  by  arbitration  in  accordance  with  the  Finnish  Act  on
Arbitration   Procedure.   The  arbitration  tribunal  shall  consist  of  three
arbitrators  one of whom shall be  appointed by the Seller and one of whom shall
be appointed by the  Purchaser.  The  arbitrators  so  appointed  shall  jointly
appoint the third  arbitrator  to act as chairman.  Unless a party has appointed
its arbitrator or the  arbitrators  have failed to appoint the third  arbitrator
within  twenty-one  (21) days from being  requested to appoint its arbitrator of
from the date the  second  arbitrator  was  appointed,  as the case may be,  the
relevant  arbitrator  shall be appointed by the Committee of  Arbitration of the
Central  Chamber of  Commerce  of  Finland.  The place of  arbitration  shall be
Helsinki  and the  arbitration  proceedings  shall be carried out in the English
language.

         9.8 Authority.  Each person whose signature appears hereon warrants and
guarantees  that he has been duly  authorized  and has full authority to execute
this  Agreement  on  behalf of the  entity on whose  behalf  this  Agreement  is
executed.

         9.9 Partial  Invalidity.  If any provision of this  Agreement  shall be
found or held to be invalid or  unenforceable,  the remainder of this  Agreement
shall be valid and enforceable to the full extent allowed by law.

         9.10  Counterparts.  This  Agreement  may be executed in  counterparts,
which,  taken together,  shall be regarded as one and the same instrument.  True
and correct copies of signed  counterparts may be used in place of the originals
for any purpose.

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         9.11 Modification.  No alteration,  amendment,  waiver, cancellation or
any other change in any term or condition  of this  Agreement  shall be valid or
binding  on a Party  unless the same shall  have been  mutually  assented  to in
writing by the Parties.

         9.12  Waiver.  The  failure  of a Party  to  enforce  at any  time  the
provisions of this Agreement,  or the failure to require at any time performance
by the other Party of any of the provisions of this  Agreement,  shall in no way
constitute a present or future waiver of such provisions,  nor in any way affect
the ability of a Party to enforce each and every such provision  thereafter.  No
waiver  shall be binding  unless in writing and signed by the Party  waiving the
breach.

         9.13 Independent Legal Advice.  The Parties  acknowledge that they have
been  advised or had the  opportunity  to be advised by their own  independently
selected  counsel and other advisors in connection with this Agreement and enter
into this Agreement solely on the basis of that advice and on the basis of their
own  independent  investigation  of all of the  facts,  laws  and  circumstances
material to this Agreement or any provisions  thereof,  and not in any manner or
to any degree based upon any statement or omission by the other Party and/or its
counsel.

         9.14  Construction.  Each Party has  cooperated in the drafting of this
Agreement. Hence, this Agreement shall not be construed against any Party on the
basis that that Party was the drafter.  The headings are for the  convenience of
the Parties and are not to be used in construing the meaning of any provision of
this Agreement. As used in this Agreement: (a) masculine,  feminine, and neutral
pronouns and any derivations thereof shall be deemed to include their respective
counterparts  as context  may  require;  (b)  singular  terms shall be deemed to
include the plural and vice versa as context may require;  (c) conjunctive terms
shall  include the  disjunctive  and vice versa as context may require;  and (d)
"herein,"  "hereof,"  "hereunder,"  and other  similar terms shall refer to this
Agreement as a whole, including the attached Schedule.

REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK

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9.15 Entire Agreement. The terms and conditions contained in this Agreement, and
the accompanying Schedules and Exhibits, constitute the entire agreement between
the Parties and supersede all previous  agreements and  understandings,  whether
oral or written,  between the Parties hereto, with respect to the subject matter
hereof.  The Schedule  attached to this  Agreement is intended by the Parties to
form an integral part of the Agreement.  It is incorporated herein by reference,
and may be updated from time to time as permitted in the Agreement.

         BY EXECUTING THIS AGREEMENT,  EACH OF THE PARTIES  ACKNOWLEDGES THAT IT
HAS READ THIS AGREEMENT AND UNDERSTANDS ITS TERMS AND PROVISIONS.

 BALANTUM OY                                          AQUAMAX (INTERNATIONAL)
                                                          HOLDING B.V.

By   /s/ Juhani Kujala                      By   /s/ Rainer Sjostrum
  --------------------------------             ---------------------------------

Name     Juhani Kujala                      Name     Rainer Sjostrum
    ------------------------------               -------------------------------

Title    CEO                                Title
     -----------------------------                ------------------------------

Date     20 July 2001                       Date     20 July 2001
    ------------------------------               -------------------------------

                                                     KEERAN CORPORATION N.V.

                                             By   /s/ Rainer Sjostrum
                                                --------------------------------

                                             Name     Rainer Sjostrum
                                                  ------------------------------

                                             Title
                                                  ------------------------------

                                             Date     20 July 2001
                                                  ------------------------------

                                       9
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                                   SCHEDULE A

                      Newco Patents and Patent Applications

                                       10
<PAGE>Exhibit 10.26
                                                                   20 July, 2001

SIDE LETTER

The parties to this Side Letter are as follows:

(1)      Balantum Oy ("Newco"),  a company organised and existing under the laws
         of Finland  (Business ID 1646698-0)  having its registered  domicile in
         the City of Helsinki and its registered address at c/o Asianajotoimisto
         Waselius & Wist Oy, Etelaesplanadi 24 A, 00130 Helsinki, Finland;

(2)      Aquamax (International) Holding B.V., ("Aquamax"),  a company organised
         and existing  under the laws of the  Netherlands  having its registered
         domicile  in the  City of  Amsterdam  and  its  registered  address  at
         Locatellikade 1, Parnassustoren, 1076 AZ Amsterdam, P.O. Box 7215, 1070
         AE Amsterdam, the Netherlands;

(3)      Keeran  Corporation N.V.  ("Keeran"),  a company organised and existing
         under  the  laws of the  Netherlands  Antilles  having  its  registered
         domicile in the City of Willemstad and its registered  address at World
         Trade Center  Curacao,  Unit  BC.II.01-04,  Piscadera Bay,  Willemstad,
         Curacao, the Netherlands Antilles;

(4)      Hadwaco Ltd Oy ("Hadwaco"),  a company organised and existing under the
         laws of Finland, having its registered domicile in the City of Helsinki
         and its registered  address at Hameentie 135, 00560  Helsinki,  Finland
         and

(5)      Ocean  Power  Corporation,  a Delaware  corporation  having a principal
         place of business at 5000 Robert J. Mathews  Parkway,  El Dorado Hills,
         California 95762, United States of America ("Ocean Power")

         WHEREAS,   Newco,  Aquamax  and  Keeran  have  today  signed  a  Patent
         Assignment Agreement (The "Agreement"); and

         WHEREAS,  Newco,  Aquamax,  and  Keeran  have  today  signed a  License
         Agreement (The "License Agreement"); and

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         WHEREAS, Newco, Aquamax and Keeran have today signed a Co-Operation and
         Sales Agreement (The "Co-Operation and Sales Agreement"); and

         WHEREAS,  Aquamax,  Keeran and Ocean  Power have today  signed a Mutual
         Release (The "Mutual Release"); and

         WHEREAS,  Aquamax and Hadwaco have today signed a Settlement  Agreement
         (The "Settlement Agreement")

         Each of the  parties  are  hereinafter  referred  to as a  "Party"  and
         together as the "Parties".  The Agreement,  the License Agreement,  the
         Co-Operation and Sales Agreement, the Mutual Release and the Settlement
         Agreement are hereinafter referred collectively as the "Agreements".

         NOW, THEREFORE,  for good and valuable  consideration,  the receipt and
         suffiiceny of which are hereby acknowledged by the Parties, the Parties
         have agreed as follows:

1.       In the event that the  transactions  contemplated  by the Agreements do
         not close on or before 31 August,  2001, as agreed between the Parties,
         all the Agreements shall  thenceforth be null and void, and none of the
         Parties  shall be bound by any of the terms or provisions of any of the
         Agreements  or be entitled to enforce any  obligations  or rights under
         any of the Agreements.  Without limiting the foregoing, it is expressly
         agreed by and between the Parties that the transaction  contemplated by
         the Agreement  cannot and shall not close until and unless  Aquamax and
         Keeran have  completed  Schedule "A" attached to said  Agreement to the
         satifaction of Newco. If Newco does not present any claims on or before
         17 August, 2001, Schedule "A" shall be considered as accepted.

2.       Notwithstanding any provision in any of the Agreements to the contrary,
         including  but not limited to section  11.9 of the  Agreement,  section
         9.15 of the License  Agreement and section 22.1 of the Co-operation and
         Sales  Agreement,  this  Side  Letter  shall be  incorporated  into the
         Agreements and shall  supersede,  modify and amend any and all terms or
         provisions of any of the  Agreements  which  conflict with the terms of
         this Side Letter.

                                       2
<PAGE>

3.       Notwithstanding  section  11.2.  of  the  Agreement,  section  8 of the
         License  Agreement  and  section  17  of  the  Co-operation  and  Sales
         Agreement,  if the  Agreements  become  null and void by  operation  of
         paragraph 1 of this Side Letter, they shall become so automatically and
         without any notice to any Party.

4.       In the event that the Agreements shall become null and void as provided
         herein the  Licensing  Agreement  fully  executed on September 21, 2000
         between Ocean Power,  Aquamax,  and Keeran (the  "Original  Agreement")
         shall remain fully valid and the validity of the Original Agreement has
         not been interrupted at any stage.

5.       This  Side  Letter  modifies  and  amends  the  Agreements,  is made in
         consideration  of the same obligations and promises as specified in the
         Agreements,  and is intended by the Parties to  consititue  an integral
         part of each of the Agreements,  notwithstanding  any provisions in any
         of the Agreements to the contrary.

6.       Notwithstanding  section  11.3  of the  Agreement,  section  9.7 of the
         License  Agreement  and  section  26  of  the  Co-operation  and  Sales
         Agreement, any dispute,  difference or claim arising beween the Parties
         in respect of any of the terms and conditions of this Side Letter or of
         performance  thereof  by any of the  Parties,  which  cannot be settled
         amicably by means of  negotiation,  shall be subject to  arbitration by
         three (3) arbitrators, unless otherwise agreed by the Parties under the
         laws of  Finland.  The  place  of  arbitration  shall  be in  Helsinki,
         Finland,  and the proceedings shall be conducted in English or Finnish,
         as the Parties might agree.

                NEWCO                       AQUAMAX (INTERNATIONAL)
                                            HOLDING B.V.

                By   /s/ Juhani Kujala      By  /s/ Rainer Sjostrum
                Name     Juhani Kujala      Name    Rainer Sjostrum
                Title_________________      Title__________________
                Date     20 July 2001       Date    20 July 2001

               KEERAN CORPORATION N.V.     HADWACO LTD OY

                By   /s/ Rainer Sjostrum     By_____________________
                Name___________________     Name___________________
                Title__________________     Title__________________
                Date     20 July 2001       Date___________________

                OCEAN POWER CORPORATION

                By   /s/ Philip Johnson
                Name________________________
                Title_______________________
                Date     20 July 2001

                                       3

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