Document:

10.3
                        AMERICAN POWER PARTNERS, INC.

                         2000 EQUITY INCENTIVE PLAN

1.   INTRODUCTION AND PURPOSE

     (a)  The purpose of this 2000 Equity Incentive Plan (the "2000 Plan" or
the "Plan") is to provide a means by which selected Employees of American
Power Partners, Inc. (the "Company") and its Affiliates, may be given an
opportunity to benefit from increases in value of the stock of the Company
through the granting of (i) Incentive Stock Options, (ii) Nonstatutory Stock
Options, (iii) Stock Bonuses, (iv) Restricted Stock, (v) Stock Appreciation
Rights, and (vi) other awards based upon the Company's Common Stock on such
terms and conditions as the Board may determine.

     (b)  The Company, by means of the Plan, seeks to retain the services of
persons who are now Employees, Directors and Consultants of the Company and
its Affiliates, to secure and retain the services of new Employees, Directors
and Consultants and to provide incentives for such persons to exert maximum
efforts for the success of the Company.  Any person, Employee, Director or
Consultant who receives a Stock Award is a "Participant" herein.

     (c)  The Company intends that the Stock Awards issued under the Plan
shall, in the discretion of the Board or any Committee to which
responsibility for administration of the Plan has been delegated pursuant to
subsection 3(c) hereof, be either (i) Options granted pursuant to Section 6
hereof, including Incentive Stock Options and Nonstatutory Stock Options,
(ii) Stock Bonuses or rights to purchase restricted stock granted pursuant to
Section 7 hereof, (iii) Stock Appreciation Rights granted pursuant to Section
8 hereof or (iv) other stock based awards granted pursuant to Section 9
hereof.  All Options shall be separately designated Incentive Stock Options
or Nonstatutory Stock Options at the time of grant, and shall be in such form
as required pursuant to Section 6 hereof.

2.   DEFINITIONS AND RULES OF INTERPRETATION

     (a)  DEFINITIONS.

          For the purposes of the Plan, in addition to the definitions set
forth above, the following terms shall have the respective meanings set forth
below, unless something in the subject matter or context is inconsistent
therewith:

          (i)  "AFFILIATE" means any parent corporation or subsidiary
corporation, whether now or hereafter existing, as those terms are defined in
Sections 424(e) and (f) respectively, of the Code.

          (ii) "BOARD" means the Board of Directors of the Company.

          (iii) "CODE" means the Internal Revenue Code of 1986, as amended.

     (a)  "COMMITTEE" means the Committee appointed by the Board in
          accordance with subsection 3(c) of the Plan.

          (v)  "COMPANY" means American Power Partners, Inc..

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          (vi) "COMPANY COMMON STOCK" means shares of the common stock of the
Company.

          (vii) "CONCURRENT STOCK APPRECIATION RIGHT" or "CONCURRENT RIGHT"
means a right granted pursuant to subsection 8(a) hereof.

          (viii) "CONTINUOUS STATUS AS AN EMPLOYEE" means the employment or
relationship as an Employee, is not interrupted or terminated by the Company
or any Affiliate.  The Committee, in its sole discretion, may determine
whether Continuous Status as an Employee, shall be considered interrupted in
the case of any leave of absence approved by the Committee, including sick
leave, military leave, or any other personal leave; provided, however, that
for purposes of Incentive Stock Options and Stock Appreciation Rights
appurtenant thereto, any such leave may not exceed ninety (90) days, unless
reemployment upon the expiration of such leave is guaranteed by contract or
statute.

          (ix) "DIRECTOR" means a member of the Board.

          (x)  "DISABILITY" means total and permanent disability as defined
in Section 22(e)(3) of the Code.

          (xi) "EMPLOYEE" means any person, including Officers and Directors,
employed by the Company or any Affiliate of the Company.  Neither service
solely as a Director nor payment of a Director's fee by the Company shall be
sufficient to constitute "employment" by the Company.

          (xii) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.

          (xiii)"FAIR MARKET VALUE" means value per share on the date of grant
as determined by the Board based upon any reasonable valuation method, or if
publicly-traded, as reported either (a) by a nationally recognized stock
exchange, (b) by the National Association of Securities Dealers Automated
Quotation System, Inc. ("NASDAQ").

          (xiv)  "INCENTIVE  STOCK OPTION" means an Option intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code and the regulations promulgated thereunder.

          (xv) "INDEPENDENT STOCK APPRECIATION RIGHT" or "INDEPENDENT RIGHT"
means a right granted under subsection 8(a) hereof.

          (i)  "NON-EMPLOYEE DIRECTOR" means a Director who either (i) is not
               a current Employee or Officer of the Company or its parent or
               subsidiary, does not receive
compensation (directly or indirectly)  from  the  Company  or  its  parent or
subsidiary  for  services  rendered  as a Consultant or in any capacity other
than as a Director (except for an amount  as to which disclosure would not be
required under Item 404(a) of Regulation S-K  (or any successor regulation of
similar import) promulgated pursuant to the Securities  Act  ("Regulation  S-
K")),  does  not  possess  an  interest  in any other transaction as to which
disclosure would be required under Item 404(a)  of  Regulation  S-K  (or  any
successor  regulation  of  similar import); or (ii) is otherwise considered a
"non-employee director" for purposes of Rule 16b-3 of the Exchange Act.

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          (xvii) "NONSTATUTORY STOCK OPTION" means an Option not intended to
qualify as an Incentive Stock Option.

          (xviii) "OFFICER" means a person who is an officer of the Company
within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.

          (xix) "OPTION" means a stock option granted pursuant to the Plan.

          (xx) "OPTION AGREEMENT" means a written agreement between the
Company and an Optionee evidencing the terms and conditions of an individual
Option grant.  Each Option Agreement shall be subject to the terms and
conditions of the Plan.

          (xxi) "OPTIONEE" means any person who holds an outstanding Option.

          (xxii) "OUTSIDE DIRECTOR" means for any given date of grant a
Director who either (i) is not then a current employee of the Company or an
"affiliated corporation" (within the meaning of Treasury regulations
promulgated under Section 162(m) of the Code), is not a former employee of
the Company or an "affiliated corporation" receiving compensation for prior
services (other than benefits under a tax qualified pension plan) during the
then current taxable year, was not an officer of the Company or an
"affiliated corporation" at any time, and is not then currently receiving
direct or indirect remuneration from the Company or an "affiliated
corporation" for services in any capacity other than as a Director, and (ii)
is otherwise considered an "outside director" for purposed of Section 162(m)
of the Code.

          (xxiii) "PLAN" or "2000 PLAN" means this 2000 Equity Incentive
Plan, as the same may be amended from time to time.

          (xxiv) "RESTRICTED STOCK" means an award of common stock that is
subject to such restrictions on transferability and other restrictions, if
any, as the compensation committee may impose at the date of grant or
thereafter, which restrictions may lapse separately or in combination at such
times, under such circumstances, including, without limitation a specific
period of employment or the satisfaction of pre-established performance
goals, in such installments, or otherwise, as the compensation committee may
determine.

          (xxv) "RULE 16b-3" means Rule 16b-3 of the Exchange Act or any
successor to Rule 16b-3.

          (xxvi) "SECURITIES ACT" means the Securities Act of 1933, as
amended.

          (xxvii) "STOCK APPRECIATION RIGHT" means any of the various types
of rights which may be granted under Section 8 hereof.

          (xxviii) "STOCK AWARD" means any right granted under the Plan,
including any Option, any stock bonus, any right to purchase restricted
stock, and any Stock Appreciation Right.

          (xxix) "STOCK AWARD AGREEMENT" means a written agreement between
the Company and a holder of a Stock Award evidencing the terms and conditions
of an individual Stock Award grant.  Each Stock Award Agreement shall be
subject to the terms and conditions of the Plan.

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          (xxx) "STOCK BONUS" means any stock bonus of the type which may be
granted under Section 7 hereof.

          (i)  "SUBSIDIARY" shall mean any corporation, if the corporation
               and/or one or more Subsidiaries owns at least fifty percent
               (50%) of the total combined voting power of all classes of
               outstanding stock in such corporation.

          (ii) "TANDEM STOCK APPRECIATION RIGHT" or "TANDEM RIGHT" means a
               right granted under subsection 8(a) hereof.

          The foregoing terms are not the exclusive definitions as used in
the Plan and reference is made to other capitalized terms defined in the
context of their first use herein.

     (b)  Rules of Interpretation.

          (i)  The headings and subheadings used herein or in any Option or
other instrument evidencing a Stock Award are solely for convenience of
reference and shall not constitute a part of the Plan or such document or
affect the meaning, construction or effect of any provision thereof.

          (ii) All definitions set forth herein shall apply to the singular
as well as the plural form of such defined term, and all references to the
masculine gender shall include reference to the feminine or neuter gender and
visa versa, as the context may require.

          (iii) Reference to "including" means including without limiting the
generality of any description preceding such term.

          (iv) Unless otherwise expressly stipulated, any reference in the
Plan to any statute, act, regulation or specific provision thereof shall also
extend to any amendment, restatement or other modification to such statute,
act, regulation or specific provision thereof or any successor statute, act,
regulation or provision of similar import.

          (v)  Unless otherwise expressly provided, any reference in the Plan
to any specific provision of any statute or act shall include any regulations
promulgated thereunder from time to time and interpretations thereof as may
be applicable to the Plan.

3.   ADMINISTRATION

     (a)  The Plan shall be administered by the Committee.

     (b)  The Committee shall have the power, subject to, and within the
limitations of, the express provisions of the Plan:
          (i)  To determine from time to time which of the persons eligible
under the Plan shall be granted Stock Awards; when and how Stock Awards shall
be granted; whether a Stock Award will be an Incentive Stock Option, a
Nonstatutory Stock Option, a Stock Bonus, a right to purchase Restricted
Stock , a Stock Appreciation Right, another stock-based award or a
combination of the foregoing; the provisions of each Stock Award granted
(which need not be identical), including the time or times when a person
shall be permitted to receive stock pursuant to a Stock Award; whether a
person shall be permitted to receive stock upon exercise of an Independent
Stock Appreciation Right; and the number of shares with respect to which
Stock Awards shall be granted to each such person.

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          (ii) To construe and interpret the Plan and Stock Awards granted
under it, and to establish, amend and revoke rules and regulations for its
administration.  The Committee, in the exercise of this power, may correct
any defect, omission or inconsistency in any Stock Award Agreement, in a
manner and to the extent it shall deem necessary or expedient to make the
Stock Award Agreement fully effective.

          (iii)  To  provide for  such  special  terms  as  it  may  consider
necessary or appropriate  to  assure  the  viability  of  awards  granted  to
Employees,  Directors  and Consultants performing services outside the United
States by accommodating differences in local law, tax policy or custom and to
approve such supplements  to,  or  amendments,  restatements  or  alternative
versions  of  the  Plan as it may consider necessary or appropriate for  such
purposes without thereby affecting the terms of the Plan as in effect for any
other purposes; provided  that, no such supplements, amendments, restatements
or alternative versions shall  increase  the  share  limitations contained in
Section 4 hereof.

          (iv) Generally, to exercise such powers and to perform such acts as
the Committee deems necessary or expedient to promote the best interests of
the Company and which are not in conflict with the provisions of the Plan.

     (c)  Administration of the Plan shall be delegated to a committee
composed of not fewer than two (2) members (the "Committee"), all of the
members of which Committee shall be Non-Employee Directors and Outside
Directors.  The Committee shall have, in connection with the administration
of the Plan, the powers set forth in the Plan; subject, however, to such
resolutions, not inconsistent with the provisions of the Plan, as may be
adopted from time to time by the Board.  The Board may abolish the Committee
at any time and revest in the Board the administration of the Plan.
Notwithstanding anything in this Section 3 to the contrary, at any time the
Board or the Committee may delegate to a committee of one or more officers of
the Company the authority to grant Stock Awards to eligible persons who are
not then subject to Section 16 of the Exchange Act and to eligible persons
with respect to whom the Company does not wish to comply with Section 162(m)
of the Code.

          The Board shall have the authority to correct any defect, omission or
inconsistency in the Plan and to amend the Plan as provided in Section 19.  The
Board shall have the authority to appoint the Committee and to fill any vacancy
created by reason of the death, resignation or removal of any member thereof by
appointing an eligible successor.

4.   SHARES SUBJECT TO THE PLAN.

     (a)  Subject to the provisions of Section 15 hereof relating to
adjustments upon changes in stock, the number of shares of Company Common
Stock that may be issued pursuant to Stock Awards under the Plan shall be
equal to 3,500,000 of such Stock.  If any Stock Award shall for any reason
expire or otherwise terminate without having been exercised in full, the
Company Common Stock not purchased shall again become available for issuance
under the Plan.  Notwithstanding the foregoing, shares of Company Common
Stock subject to Stock Appreciation Rights exercised in accordance with
Section 8 hereof shall not be available for subsequent issuance under the
Plan.
     (B)  THE COMPANY COMMON STOCK SUBJECT TO THE PLAN MAY CONSIST IN
WHOLE
OR IN PART OF AUTHORIZED BUT UNISSUED SHARES OR TREASURY SHARES.
SUBJECT TO
SUBSECTION 4(A), NOT MORE THAN 800,000 shares of Company Common Stock in the
aggregate may be subject to Stock Bonuses and restricted stock awards
(provided for in Section 7), Stock Appreciation Rights (provided for in
Section 8), and other awards (provided for in Section 9).

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5.   ELIGIBILITY

          (a)   No  person shall be eligible for the grant  of  an  Incentive
     Stock Option if, at the time of grant, such person owns (or is deemed to
     own pursuant to  Section  424(d)  of  the  Code)  Company  Common  Stock
     possessing  more  than  ten  percent  (10%) of the total combined voting
     power of all classes of capital stock of  the  Company  or of any of its
     Affiliates unless the exercise price of such Incentive Stock  Option  is
     at least one hundred ten percent (110%) of the Fair Market Value of such
     Company Common Stock at the date of grant and the Incentive Stock Option
     is  not exercisable after the expiration of five (5) years from the date
     of grant.

     (b)  No person shall be eligible to be granted Stock Awards covering
more than 550,000 shares of Company Common Stock in any calendar year.

6.   OPTION PROVISIONS

     Each Option Agreement shall be in such form and shall contain such terms
and conditions as the Committee shall deem appropriate.  The provisions of
separate Options need not be identical, but each Option Agreement shall
include (through incorporation of provisions hereof by reference in the
Option or otherwise) the substance of each of the following provisions except
as otherwise specifically provided elsewhere in the Plan.

     (a) TERM.  No Option shall be exercisable after the expiration of ten
(10) years from the date it was granted.

     (b)  PRICE.  Subject to subsection 5(b) hereof, the exercise price of
each Incentive Stock Option shall be not less than one hundred percent (100%)
of the Fair Market Value of the Company Common Stock subject to the Option on
the date the Option is granted.  The exercise price of each Nonstatutory
Stock Option shall be set by the Committee at the time each Option is
granted, but in no event shall (i) any exercise price be less than the par
value of the Company Common Stock and (ii) not more than 1,000,000 of Company
Common Stock shall be subject to a Nonstatutory Stock Option at an exercise
price less than one hundred percent (100%) of such Fair Market Value.

     (c)  PAYMENT FOR STOCK. Stock purchased on exercise of an Option must be
paid in cash or by certified check (acceptable to the Company in accordance
with guidelines established for this purpose), bank draft or money order
payable to the order of the Company, by delivery of a full recourse
promissory note of the Optionee to the Company on terms determined by the
Committee, or by such other method as shall be determined by the Committee.

In the case of payment made by a promissory note, interest shall be payable
at least annually and shall be charged at the minimum rate of interest
necessary to avoid the treatment of interest, under any applicable provisions
of the Code, of any amounts other than amounts stated to be interest.

     (d)    TRANSFERABILITY.    An   Incentive  Stock  Option  shall  not  be
transferable except by will or by the  laws  of descent and distribution, and
shall be exercisable during the lifetime of the  person to whom the Incentive
Stock Option is granted only by such person.  A Nonstatutory Stock Option may
be transferred upon such terms and conditions as are  set forth in the Option
Agreement, as the Committee shall determine in its sole discretion, including
(without  limitation)  pursuant to a "domestic relations  order"  within  the

<PAGE>

meaning of such rules, regulations  or  interpretation  of the Securities and
Exchange  Commission  as  are applicable for purposes of Section  16  of  the
Exchange Act, or to family members, or to trusts or other entities maintained
for the benefit of family members.  Notwithstanding the foregoing, the person
to whom an Option is granted may, by delivering written notice to the Company
in a form satisfactory to the  Company,  designate  a third party who, in the
event of the death of the Optionee, shall thereafter  be entitled to exercise
the Option.

(e)  VESTING.  The total number of shares of stock subject  to an Option may,
but need not, be allotted in periodic installments (which may,  but need not,
be  equal).   The Option Agreement may provide that from time to time  during
each of such installment  periods, the Option may become exercisable ("vest")
with respect to some or all of the shares allotted to that period, and may be
exercised with respect to some  or  all of the shares allotted to such period
and/or any prior period as to which the  Option  became  vested  but  was not
fully  exercised.   The  Option  may  be  subject  to  such  other  terms and
conditions  on  the  time or times when it may be exercised (e.g., Change  in
Control,  performance  or   other   criteria)   as  the  Committee  may  deem
appropriate.  During the remainder of the term of  the  Option  (if  its term
extends  beyond  the  end  of  the  installment  periods),  the Option may be
exercised from time to time with respect to any shares then remaining subject
to  the  Option.  The provisions of this subsection 6(e) are subject  to  any
Option provisions  governing  the  minimum  number  of  shares as to which an
Option may be exercised.

     (f)  TERMINATION OF EMPLOYMENT.  In the event an Optionee's Continuous
Status as an Employee terminates (other than upon the Optionee's death,
Disability or retirement), the Optionee may exercise his or her Option, but
only within such period of time ending on the earlier of (i) 90 days after
termination of the Optionee's Continuous Status as an Employee or such longer
or shorter period of time specified in the Option Agreement, or (ii) the
expiration of the Option's term, and only to the extent that the Optionee was
entitled to exercise it at the date of termination (but in no event later
than the expiration of the term of such Option as set forth in the Option
Agreement).

          In the event of the retirement of an Optionee from the Company
pursuant to the Company's retirement policy then in effect, or if there be
none, then as determined by the Committee in its sole discretion, he or she
may exercise his or her Option during the period ending twelve (12) months
after his or her retirement date (or 90 days in the case of an Incentive
Stock Option).  If, at the date of termination, the Optionee is not entitled
to exercise his or her entire Option, the shares covered by the unexercisable
portion of the Option shall revert to and again become available for issuance
under the Plan.  If, after termination, the Optionee does not exercise his or
her Option within the time specified in the Option Agreement, the Option
shall terminate, and the shares covered by such Option shall revert to and
again become available for issuance under the Plan.

          An Optionee's Option Agreement may also provide that if the
exercise of the Option following the termination of the Optionee's Continuous
Status as an Employee, (other than upon the Optionee's death or disability)
would be prohibited at any time solely because the issuance of shares would
violate the registration requirements under the Act, then the Option shall
terminate on the earlier of (i) the expiration of the term of the Option set
forth in the first paragraph of this subsection 6(f), or (ii) the expiration
of a period of three (3) months after the termination of the Optionee's
Continuous Status as an Employee, during which the exercise of the Option
would not be in violation of such registration requirements.

<PAGE>

          Notwithstanding the preceding, in the event an Optionee's
employment with (or services to) the Company is terminated by it for cause
(as determined by the Company), the Option shall terminate on the date of
termination and the shares covered by such Option shall revert to and again
become available for issuance under the Plan.

As used herein, "cause" shall mean (a) any breach under that person's written
employment agreement, if any, with the Company, or if the Optionee is not a
party to a written employment with the Company, "cause" shall mean (x) any
material breach by the Optionee of any agreement to which the Optionee and
the Company are both parties, (y) any act or omission to act by the Optionee
which may have a material and adverse effect on the Company's business or on
the Optionee's ability to perform services for the Company, including,
without limitation, the commission of any crime (other than ordinary traffic
violations), or (z) any material misconduct or material neglect of duties by
the Optionee in connection with the business or affairs of the Company or any
affiliate of the Company.

     (g)  DISABILITY OF OPTIONEE.  In the event an Optionee's Continuous
Status as an Employee terminates as a result of the Optionee's Disability,
the Optionee may exercise his or her Option, but only within such period of
time ending on the earlier of (i) the date twelve (12) months following such
termination (or such longer or shorter period of time as specified in the
Option Agreement), or (ii) the expiration of the term of the Option as set
forth in the Option Agreement.  If, at the date of termination, the Optionee
does not exercise his or her Option within the time specified herein, the
Option shall terminate, and the shares covered by such Option shall revert to
and again become available for issuance under the Plan.

     (h)  DEATH OF OPTIONEE.  In the event of a death of an Optionee during,
or within a period specified in the Option Agreement after the termination
of, the Optionee's Continuous Status as an Employee, the Option may be
exercised by the Optionee's estate, by a person who acquired the right to
exercise the Option by bequest or inheritance, or by a person designated to
exercise the option upon the Optionee's death pursuant to subsection 6(d)
hereof, but only within the period ending on the earlier of: (i) the date
twelve (12) months following the date of death (or such longer or shorter
period specified in the Option Agreement), or (ii) the expiration of the term
of such Option as set forth in the Option Agreement.  If, at the time of
death, the Optionee was not entitled to exercise his or her entire Option,
the shares covered by the unexercisable portion of the Option shall revert to
and again become available under the Plan.  If, after death, the Option is
not exercised within the time specified herein, the Option shall terminate,
and the shares covered by such Option shall revert to and again become
available for issuance under the Plan.

     (i)  EARLY EXERCISE.  The Option may, but need not, include a provision
whereby the Optionee may elect at any time while an Employee, to exercise the
Option as to any part or all of the shares subject to the Option prior to the
full vesting of the Option; provided, however, any unvested shares shall be
subject to a repurchase right in the Company at the Exercise Price in the
event of the Optionee's termination.

            (j) TAX WITHHOLDING. The Company shall have the  right  to deduct
from  any  settlement of an award made under the Plan, including the delivery
or vesting of  Shares  of  Company  Common  Stock  up  to  the minimum amount
necessary to cover withholding of any federal, state or local  taxes required
by law, or to take such other action as may be necessary to satisfy  any such
withholding obligations.  The Committee may, in its discretion and subject to
such  rules  as  it  may  adopt, permit participants to use shares of Company
Common Stock to satisfy the  minimum  required  tax  withholding  (with prior
approval of the Committee if Shares are owned less than six months)  and such

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Shares shall be valued at the Fair Market Value as of the settlement date  of
the applicable award.

          (k) RIGHT OF FIRST REFUSAL.  Notwithstanding any other provision in
the  Plan  to  the contrary, if the Participant desires to transfer shares of
Common Stock of  the  Company when such shares are not readily tradable on an
established securities  market (e.g., the New York Stock Exchange or NASDAQ),
the Company shall have the  right  to purchase all, and not less than all, of
the shares of Company Common Stock on  the  terms set forth in the applicable
Stock Agreement between the Company and the Participant.

7.   TERMS OF STOCK BONUSES AND PURCHASES OF RESTRICTED STOCK

     Each Stock Bonus or Restricted Stock award agreement shall be in such
form and shall contain such terms and conditions as the Committee shall deem
appropriate.  The terms and conditions of Stock Bonus or Restricted Stock
award agreements may change from time to time, and the terms and conditions
of separate agreements need not be identical, but each Stock Bonus or
Restricted Stock award agreement shall include (through incorporation of
provisions herein by reference in the agreement or otherwise) the substance
of each of the following provisions as appropriate:

     (a)  PURCHASE PRICE.  The purchase price under each Restricted Stock
award agreement shall be such amount as the Committee shall determine and
designate in such agreement.  Notwithstanding the foregoing, the Committee
may determine that eligible participants in the Plan may be granted a Stock
Award pursuant to a Stock Bonus agreement in consideration for past services
actually rendered to the Company for its benefit.

     (b)  TRANSFERABILITY.  Except as otherwise provided elsewhere in the
Plan, no rights under a Stock Bonus or Restricted Stock award agreement shall
be assignable by any participant under the Plan, either voluntarily or by
operation of law, except by will or by the laws of descent and distribution,
and shall be exercisable during the lifetime of the person to whom the rights
are granted only by such person.  The person to whom the Stock Award is
granted, may, by delivering written notice to the Company, in a form
satisfactory to the Company, designate a third party who, in the event of the
death of such person, shall thereafter be entitled to exercise the rights
held by such person under the Stock Bonus or Restricted Stock award
agreement.

     (c)  PAYMENT FOR STOCK.   The purchase price determined under subsection
7(a) hereof must be paid for in cash or by certified check (acceptable to the
Company in accordance with guidelines established for this purpose), bank
draft or money order payable to the order of the Company, or by delivery of a
full recourse promissory note of the Optionee to the Company on terms
determined by the Committee.

In the case of payment made by a promissory note, interest shall be payable
at least annually and shall be charged at the minimum rate of interest
necessary to avoid the treatment of interest, under any applicable provisions
of the Code, of any amounts other than amounts stated to be interest.

     (d)  VESTING.  Shares of Company Common Stock sold or awarded under the
Plan may, but need not, be subject to a repurchase option in favor of the
Company in accordance with a vesting schedule to be determined by the
Committee.

<PAGE>

     (e)  TERMINATION OF EMPLOYMENT.  In the event a Participant's Continuous
Status as an Employee terminates, the Company may repurchase or otherwise
reacquire any or all of the shares of Company Common Stock held by that
person which have not vested as of the date of termination under the terms of
the Stock Bonus or Restricted Stock purchase agreement between the Company
and such person.

8.   STOCK APPRECIATION RIGHTS

     (a)  The Committee shall have full power  and  authority, exercisable in
its  sole  discretion,  to  grant  Stock  Appreciation Rights  to  Employees,
Directors and Consultants of the Company or  its  Affiliates  under  the Plan
under such terms and conditions as it shall determine.  Each such right shall
entitle  the  holder to a distribution based on the appreciation in the  Fair
Market Value per share of a designated amount of Company Common Stock.

     (b)   The three  types  of  Stock  Appreciation  Rights  authorized  for
issuance under  the  Plan  are:  Tandem Stock Appreciation Rights, Concurrent
Stock Appreciation Rights and Independent Stock Appreciation Rights.

9.   OTHER STOCK-BASED AWARDS

     The Committee shall have the right to grant other Awards based upon
Company Common Stock having such terms and conditions as the Committee may
determine, including the grant of shares based upon certain conditions and
the grant of securities convertible into Company Common Stock.

10.  TAX WITHHOLDING

     The Company shall have the right to deduct from any settlement of an
award made under the Plan, including the delivery or vesting of shares of
Company Common Stock up to the minimum amount necessary to cover withholding
of any federal, state or local taxes required by law, or to take such other
action as may be necessary to satisfy any such withholding obligations.  The
Committee may, in its discretion and subject to such rules as it may adopt,
permit participants to use shares of Company Common Stock to satisfy the
minimum required tax withholding (with prior approval of the Committee if
Shares are owned less than six months) and such Shares shall be valued at the
Fair Market Value as of the settlement date of the applicable award.

<PAGE>

11.  CANCELLATION AND RE-GRANT OF OPTIONS

     (a)  Subject to prior approval by the Company's stockholders, the
Board or the Committee shall have the authority to effect, at any time and
from time to time , with the consent of the affected holders of Options
and/or Stock Appreciation Rights, (i) the repricing of any outstanding
Options and/or Stock Appreciation Rights under the Plan and the grant in
substitution therefor of new Options and/or Stock Appreciation Rights under
the Plan covering the same or different numbers of shares of Company Common
Stock, but having an exercise price per share not less than eighty five
percent (85%) of the Fair Market Value (one hundred percent (100%) of the
Fair Market Value in the case of an Incentive Stock Option) or, in the case
of an Incentive Stock Option granted to a 10% stockholder (as described in
subsection 5(b) hereof, not less than one hundred ten percent (110%) of the
Fair Market Value) per share of Company Common Stock on the new grant date.
Notwithstanding the foregoing, the Committee may grant an Option and/or
Stock Appreciation Right with an exercise price lower than that set forth
above if such Option and/or Stock Appreciation Right is granted as part of
a transaction to which Section 424(a) of the Code applies.

     (b)  Shares of Company Common Stock subject to an Option or Stock
Appreciation Right canceled under this Section 11 shall continue to be
counted against the maximum award of Options and Stock Appreciation Rights
permitted to be granted to a person pursuant to subsection 5(c) hereof.
The repricing of an Option and/or Stock Appreciation Right under this
Section 11, resulting in a reduction of the exercise price, shall be deemed
to be a cancellation of the original Option and/or Stock Appreciation Right
and the grant of a substitute Option and/or Stock Appreciation Right; in
the event of such repricing, both the original and the substituted Options
and Stock Appreciation rights shall be counted against the maximum awards
of Options and Stock Appreciation Rights permitted to be granted to a
person pursuant to subsection 5(c) hereof.  The provisions of this
subsection 11(b) shall be applicable only to the extent required by Section
162(m) of the Code.

12.  COVENANTS OF THE COMPANY

     (a)  During the terms of the Stock Awards, the Company shall keep
available at all times the number of shares of Company Common Stock
required to satisfy such Stock Awards, but in any event, not more than the
number of shares of Company Common Stock authorized under the Plan.

     (b)  The Company shall seek to obtain from each regulatory commission
or agency having jurisdiction over the Plan such authority as may be
required to issue and sell shares of Company Common Stock under the Stock
Awards; provided, however, that this undertaking shall not require the
Company to register under the Securities Act either the Plan, any Stock
Award or any stock issued or issuable pursuant to any such Stock Award.
If, after reasonable efforts, the Company is unable to obtain from any such
regulatory commission or agency the authority which counsel for the Company
deems necessary for the lawful issuance and sale of Company Common Stock
under the Plan, the Company shall be relieved from any liability for
failure to issue and sell Company Common Stock under such Stock Awards
unless and until such authority is obtained.

13.  USE OF PROCEEDS FROM STOCK

     Proceeds from the sale of Company Common Stock pursuant to Stock
Awards shall constitute general funds of the Company.

<PAGE>

14.  MISCELLANEOUS

     (a)  The Committee shall have the power to accelerate the time at
which a Stock Award may first be exercised or the time during which a Stock
Award or any part thereof will vest, notwithstanding the provisions in the
Stock Award stating the time at which it may first be exercised or the time
during which it will vest.

     (b)  Neither an Optionee nor any person to whom an Option is
transferred under subsection 6(d) hereof shall be deemed to be the holder
of, or to have any of the rights of a holder with respect to, any shares of
Company Common Stock subject to such Option unless and until such person
has satisfied all requirements for exercise of the Option pursuant to its
terms.

     (c)  Nothing in the Plan or any instrument executed or Stock Award
granted pursuant thereto shall confer upon any Employee, Director,
Consultant, Optionee, or other holder of Stock Awards any right to continue
in the employ of the Company or any Affiliate (or to continue acting as
Director or Consultant) or shall affect the right of the Company or any
Affiliate to terminate the employment or relationship as a Director or
Consultant of any Employee, Director, Consultant or Optionee, with or
without cause.

     (d)  To the extent that the aggregate Fair Market Value (determined at
the time of grant) of Company Common Stock with respect to which Incentive
Stock Options are exercisable for the first time by any Optionee during any
calendar year under all plans of the Company and its Affiliates exceeds one
hundred thousand dollars ($100,000), the Options or portions thereof which
exceed such limit (according to the order in which they were granted) shall
be treated as Nonstatutory Stock Options.

     (e)  The Committee shall be authorized to establish procedures
pursuant to which Participants may elect to defer the gain realized upon
exercise of a stock option, or such gain derived from other Stock Awards
granted under the Plan.

     (f)  The Company will not be obligated to deliver any shares of
Company Common Stock pursuant to the Plan or to remove
restrictions from such shares previously delivered under the
Plan (a) until all conditions of the Option or award have
been satisfied or removed, (b) until, in the opinion of the
Company's counsel, all applicable Federal and state laws and
regulations have been complied with, (c) if the outstanding
Company Common Stock is at the time on any stock exchange or
The Nasdaq National Market, until the shares to be delivered
have been listed or authorized to be listed on such exchange
or market upon official notice of notice of issuance, and
(d) until all other legal matters in connection with the
issuance and delivery of stock has been approved by the
Company's counsel.

     If the sale of Shares of Company  Common Stock has not been registered
under the Securities Act of 1933, as amended, the Company may require, as a
condition to exercise of the award, such  representations  or agreements as
counsel for the Company may consider appropriate to avoid violation of such
Act; including the representation or warranty of the person  exercising the
option that the Shares of Company Common Stock are being purchased only for
investment  and  without  any present intention to sell or distribute  such
shares and the certificates  evidencing  such  Stock  shall bear the legend
restricting transfer as set forth in Section 17.

<PAGE>

     (g)  If an Option is exercised by the Participant's legal
representative or transferee, the Company will be under no obligation to
deliver Company Common Stock pursuant to such exercise until the Company is
satisfied as to the authority of such representative.

15.  EFFECT OF CHANGE IN STOCK SUBJECT TO THE PLAN

     In the event there is any change in the shares of Common Stock of the
Company through the declaration of stock dividends or through
recapitalizations resulting in stock subdivisions or combinations or
exchanges of shares or otherwise, the number of shares available for
Option, the exercise price of outstanding Options, and the number of shares
subject to any Option shall be appropriately adjusted by the Board.

16.  CHANGE IN CONTROL

     Notwithstanding any other provision of the Plan to the contrary, in
the event of a Change of Control as determined solely by the Board:

     (a)  Stock Awards outstanding as of the date such Change of Control is
determined to have occurred shall become exercisable to the extent provided
for in each Optionee's Award agreement.

     (b)  In connection with or following a Change of Control, neither the
Committee nor the Board may impose additional conditions upon exercise or
otherwise amend or restrict an Option, SAR, share of Restricted Stock,
Deferred Stock Award or Performance Award, or amend the terms of the Plan
in any manner adverse to the holder thereof, without the written consent of
such holder.

          Notwithstanding the foregoing, if any right granted pursuant to
this Section 16 would make a Change of Control transaction ineligible for
pooling of interests accounting under applicable accounting principles that
but for this Section 16 would otherwise be eligible for such accounting
treatment, the Committee shall have the authority to substitute Stock for
the cash which would otherwise be payable pursuant to this Section 16
having a fair market value equal to such cash.

17.  RESTRICTIONS ON COMPANY COMMON STOCK

                 All stock certificates representing shares of Company
Common Stock sold or awarded pursuant to the Plan shall contain a legend
substantially in the following form:

          "The  shares  evidenced  by  this  certificate  have   not   been
registered  under  the  Securities  Act  of  1933, as amended, or any state
securities or Blue Sky laws, and may not be transferred, sold, or otherwise
disposed  of,  except  pursuant to an effective registration  statement  or
pursuant to an exemption  from  registration  under  the  Securities Act of
1933, as amended, and applicable state securities or Blue Sky laws.

     In  the event that the shares of Common Stock issued pursuant  to  the
terms of the  Plan  are:  (i) registered under the Securities Act, pursuant
to  an  effective  registration  statement  that  complies  with  the  then

<PAGE>

applicable  regulations,   rules,  and  procedures  and  practices  of  the
Securities and Exchange Commission,  and  are registered in accordance with
any   applicable  state  laws,  regulations,  rules,   and   administrative
procedures  practices,  or  (ii)  transferred pursuant to another exemption
from registration under the Securities  Act  and,  at  the  request  of the
Company  has  received a legal opinion, satisfactory to its counsel, as  to
the availability of and compliance with such exemption and that the Company
Common Stock need  not  bear the restrictive legend stating that such Stock
has not been registered under  the  Securities Act, the Company may issue a
new certificate such Stock bearing the restrictive legend.

18.  GRANT OF OPTIONS IN CONNECTION WITH CERTAIN ACQUISITIONS

     The Board may grant Options under the Plan in substitution for
Incentive Stock Options or non-statutory stock options granted under plans
of other employers, if such grant occurs by reason of a corporate merger,
consolidation, separation, reorganization, or liquidation to which the
Company is a party, or by reason of the acquisition of property or stock of
another corporation by the Company; provided that, with respect to any
Incentive Stock Option, such transaction is a transaction to which Section
424(a) of the Code applies.  The Board may impose such terms and conditions
upon the grant of any Incentive Stock Options under this Section 18 as are
necessary to ensure that the substitution will not constitute a
modification of the Option under Section 424(h) of the Code, even though
any such term or condition would otherwise be inconsistent with the
provisions of this Plan.  Options granted under the provisions of this
Section 18 may be granted at a price less than the Fair Market Value of the
Common Stock on the date such Option is granted, so long as the ratio of
the Option price to the Fair Market Value of the Common Stock is no more
favorable to the Optionee than the ratio of the Option price to the Fair
Market Value of the stock subject to the old option immediately before such
substitution. Except as otherwise specifically provided in the agreement
setting forth the terms and conditions of such Option, the provisions of
this Plan shall govern any Options granted under this Section 18.  Nothing
in this Section 18 shall be deemed to authorize the grant of Options under
the Plan for a number of shares in excess of the number set forth in
Section 4, nor to limit in any way the authority of the Board to grant
substituted Options in connection with such transactions other than under
the Plan.

19.  AMENDMENT OF THE PLAN AND STOCK AWARDS

     (a)  The Board at any time, and from time to time, may amend the Plan.
However, except as provided in Section 15 hereof relating to adjustments
upon changes in stock, no amendment shall be effective unless approved by
the stockholders of the Company to the extent stockholder approval is
necessary as determined solely by counsel for the Company.

     (b)  The Board may in its sole discretion submit any other amendments
to the Plan for stockholder approval, including, but not limited to,
amendments to the Plan intended to satisfy the requirements of Section
162(m) of the Code and the regulations promulgated thereunder regarding the
exclusion of performance-based compensation from the limit on corporate
deductibility of compensation paid to certain executive officers.

     (c)  It is expressly contemplated that the Board may amend the Plan in
any respect the Board deems necessary or advisable to provide Optionees
with the maximum benefits provided or to be provided under the provision of
the Code and the regulations promulgated thereunder relating to Incentive
Stock Options and/or to bring the Plan and/or Incentive Stock Options
granted under it into compliance therewith.

<PAGE>

     (d)  Rights and obligations under any Stock Award granted before
amendment of the Plan shall not be altered or impaired by any amendment of
the Plan unless (i) the Company requests the consent of the persons to whom
the Stock Award was granted and (ii) such person consents in writing.

     (e)  The Committee at any time, and from time to time, may amend the
terms of any one or more Stock Awards; provided, however, that the rights
and obligations under any Stock Award shall not be altered or impaired by
any such amendment unless (i) the Company requests the consent of the
person to whom the Stock Award was granted and (ii) such person consents in
writing.

20.  TERMINATION OR SUSPENSION OF THE PLAN

     (a)  The Board may suspend or terminate the Plan at any time.  Unless
sooner terminated, the Plan shall terminate on November 13, 2010.  No Stock
Awards may be granted under the Plan while the Plan is suspended or after
it is terminated.

     (b)  Rights and obligations under any Stock Award granted while the
Plan is in effect shall not be impaired by suspension or termination of the
Plan, except with consent of the person to whom the Stock Award was
granted.

21.  GOVERNING LAW

          The provisions of the Plan  and  all  Stock Awards made hereunder
     shall be governed by and interpreted in accordance  with  the internal
     laws  of  the State of Colorado or which state shall be applicable  as
     deemed by the Board, without regard to any applicable conflicts of law
     principles.

                                  *******

Adopted by the Board of Directors on

NOVEMBER 13, 2000

Approved by the Company's Stockholders on

________________10.4
                            OPERATING AGREEMENT

     THIS JOINT  OPERATING  AGREEMENT  is  entered into effective as of the
12{th} day of September, 2000, by and between Americas Power Partners, Inc.
("APP") and Armstrong Service, Inc. ("ASI").

RECITALS

     WHEREAS,  APP  is a Colorado corporation,  which  is  engaged  in  the
business of performing APP Services (as defined herein); and

     WHEREAS, ASI is  a  Michigan  Corporation,  which  is  involved in the
business of performing ASI Services (as defined herein) ; and

     WHEREAS, ASI and APP (herein referred to as "the Parties")  desire and
intend  to  undertake  joint  efforts  to  market, analyze, own and operate
steam, compressed air, wastewater, electric  power  generation  and related
utility  systems  projects  so as to thereby create opportunities for  each
party to increase its respective  sales  to  industrial,  institutional and
commercial end user customers; and

     WHEREAS,  ASI  and  APP  desire  to  enter  into  this Joint Operating
Agreement  in  order  to  define  the  nature  and scope of their  business
relationship  and to establish and set out the parameters  of  their  joint
efforts  and  responsibilities   for  the  implementation  of  a  marketing
relationship for products and services  to  be  provided jointly by APP and
ASI related to the Business Scope, as defined herein.

     NOW, THEREFORE, in consideration of the premises  and  the  agreements
herein contained, the parties agree as follows:

                                 ARTICLE 1
                               GENERAL TERMS

1.1  DEFINITIONS.  The  terms "ASI" and "APP" shall have the above meanings
and the following terms shall have the following meanings:

     "AFFILIATE" shall mean,  with  respect  to  any Person: (i) any Person
directly or indirectly controlling, controlled by,  or under common control
with such Person, (ii) any Person owning or controlling  fifty  one percent
(51%) or more of the outstanding voting interests of such Person, (iii) any
officer,  director,  or general partner of such Person, or (iv) any  Person
who is an officer, director,  general  partner, trustee, or holder of fifty
one percent (51%) or more of the voting  interests  of any Person described
in  clauses  (i)  through  (iii)  of  this sentence. For purposes  of  this
definition, the term "controls," "is controlled  by,"  or  "is under common
control with" shall mean the possession, direct or indirect,  of  the power
to  direct  or  cause  the  direction  of the management and policies of  a
Person, whether through the ownership of  voting securities, by contract or
otherwise.

<PAGE>

"AGREEMENT" means this Joint Operating Agreement,  as  from  time  to  time
amended or supplemented.

"APP  SERVICES"  means  the  business  of  purchasing,  owning,  financing,
optimizing,  monetizing  and otherwise developing Utility Systems for  End-
Users.

"ASI  SERVICES"  means  the business  of  designing,  selling,  installing,
constructing, optimizing  (including  EPC  Services  and  O&M  Services on)
Utility Systems for End-Users, including related components and equipment.

"BUSINESS SCOPE" shall have the meaning as set forth in SECTION 2.2.

 "CONFIDENTIAL INFORMATION" means all information to be disclosed by either
party  to  the  other party which is confidential, proprietary or generally
not  available to  the  public,  including  the  information  described  in
SECTIONS  10.1  and 10.2, including confidential work product of ASI and/or
APP, but specifically excluding advertising and sales information materials
or other information  prepared  for  an  identified customer by a Party and
delivered  either to an identified customer  or  to  the  other  party  for
delivery to  an  identified customer, which information is not subject to a
binding  confidentiality   agreement  between   ASI  and/or  APP  and  such
customer.

"END-USER" means industrial, commercial, and institutional customers and/or
prospective customers.

"ENTITY" shall mean any general  partnership,  limited partnership, limited
liability  company,  corporation,  joint  venture, trust,  business  trust,
cooperative  or  association  or  any  foreign trust  or  foreign  business
organization.

"EPC  SERVICES"  shall  mean  engineering,  procurement   and  construction
services related to Projects.

"MONETIZATION" shall mean the purchase of any Utility System  Assets by the
Parties from an End-User.

"O&M  SERVICES"   shall mean operation and maintenance services related  to
Projects.

"OPERATING COMPANY"  shall  mean  an  Entity  formed by the Parties for the
purpose of purchasing, owning, optimizing, operating or maintaining Utility
System  Assets  associated  with  any  Projects which  are  to  be  jointly
developed under the terms of this Agreement.

"OPTIMIZATION" shall mean the upgrading,  modification, and/or constructing
of and End-User's Utility System Assets for  the  purpose  of improving the
performance  and  efficiency  of  such  assets,  including  the design  and
installation  of  new and/or additional components and equipment  for  such
purposes.

<PAGE>

"PARTY" shall mean  either  Americas  Power  Partners,  Inc.  or  Armstrong
Service, Inc.

"PERSON" shall mean a natural person or an Entity.

"PROJECT" shall mean projects for which the Parties or an Operating Company
formed by the Parties pursuant to the terms of this Agreement, have entered
into,  or  propose  to  enter  into, a contract for the Optimization and/or
Monetization of Utility System Assets.

"REPRESENTATIVES" means a party's  directors,  employees, advisors, lenders
and  representatives  and  such party's Affiliates'  directors,  employees,
advisors, lenders and representatives.   Representatives  shall not include
independent   sales   representatives   for   the   products  of  Armstrong
International,  Inc.  and/or  Armstrong  Service,  Inc. and  its  or  their
affiliates.

"SERVICES"  shall  mean  the  Optimization and/or Monetization  of  Utility
System Assets and/or Utility Systems and the performance of O&M Services in
connection therewith.

"UTILITY SYSTEMS" shall mean steam,  air, water, wastewater, electric power
generation, lighting and other utility systems of an End User.

"UTILITY  SYSTEM ASSETS" shall mean the  assets  and  equipment,  including
components consisting of, or related Utility Systems.

1.2  SINGULAR  AND  PLURAL.   Words  used herein in the singular, where the
context  so  permits,  also  include  the  plural   and  vice  versa.   The
definitions of words in the singular herein, where the  context so permits,
also apply to such words when used in the plural and vice versa.

                                 ARTICLE 2
               RELATIONSHIP OF PARTIES AND SCOPE OF BUSINESS

2.1  RELATIONSHIP  OF THE PARTIES.   APP and ASI have jointly  pursued  the
development of Projects.   The  Parties  desire  and  intend to continue to
jointly  pursue  Projects  and  wish  to define responsibilities,  maximize
efficient use of resources and provide  for the manner in which income will
be derived and/or profits will be shared  by  the  Parties from any jointly
developed and successfully implemented Projects.

2.2  BUSINESS SCOPE.  The business scope ("Business  Scope"),  which is the
subject  of this Agreement, shall be: multi-year financed contracts  to  be
entered into  by  the Parties or an Operating Company formed by the Parties
pursuant to the terms of this Agreement for performance of the Services for
End Users.  The Business  Scope  shall  include the United States, but does
not include Projects in any territory or  location  where either APP or ASI
is subject to a legal and/or contractual restriction  against  any business
development or other activities in such territory.

<PAGE>

2.3  USE OF APP/ASI NAMES, MARKS AND LOGOS.  The Parties agree that as part
of  their joint efforts to pursue, market and develop Projects and  related
Services under the terms of this Agreement,

     (a)  APP  shall  have a non-exclusive, royalty-free license during the
        term of this Agreement  to  use the name "Armstrong Service" and/or
        "Armstrong" and shall further  have  the right to use service marks
        and/or logos owned or otherwise held in the name of ASI. All names,
        marks and logos held in the name of ASI,  which  may be used by APP
        under authority granted herein, shall remain the sole and exclusive
        property of ASI; and

     (b)  ASI shall have a non-exclusive, royalty-free license  during  the
        term  of  this  Agreement to use the name "Americas Power Partners"
        and/or "Americas"  and  shall further have the right to use service
        marks and/or logos  owned or otherwise held in the name of APP. All
        names, marks and logos held  in  the name of APP, which may be used
        by ASI under authority granted herein,  shall  remain  the sole and
        exclusive property of APP.

The  names, marks and logos of the parties may be used in combination  with
those  of  the other.  The rights granted under this SECTION 2.3 may not be
assigned or  sublicensed  to  any  third  party.  The rights granted herein
shall apply within the United States of America.   Either Party may request
that the rights described herein be extended to other  defined countries or
territories,   which   request   shall   not   be   unreasonably  withheld.
Notwithstanding this Section or any other provision of this Agreement, each
Party may place reasonable restrictions and limitations  on  the use by the
other party of the Party's name, service marks or logos.

                                 ARTICLE 3
                      RESPONSIBILITIES OF THE PARTIES

3.1  IDENTIFICATION OF PROJECT OPPORTUNITIES.  APP and ASI will  be jointly
responsible for marketing the products and Services to be provided  by  the
Parties,  including  all efforts to identify, locate, market and/or solicit
potential development  and  opportunities  for Projects within the Business
Scope.

3.2  FINANCIAL ANALYSIS AND FINANCING OF PROJECT  OPPORTUNITIES.   APP
will
be  primarily  responsible  for performing the APP Services, including  the
financial analysis of any potential development Projects identified through
the joint or individual marketing  efforts of the Parties.  The analysis is
to be performed by APP based on information  obtained  from  all  available
sources  in  order  to fully evaluate the required capital investment,  the
potential return on investment,  potential  for savings to be shared by the
Parties  and  the End User, the ability to obtain  required  financing  and
other issues related  to  the  financial  viability  of the Project and the
advisability  of  pursuing  the  Project  from  a financial  or  investment
standpoint.   APP will work to structure and obtain  appropriate  financing
for Projects which  are  to  be  further  pursued  and/or undertaken by the
Parties and be responsible for coordinating negotiations  for (1) contracts
for  required  fuel  supply  and  (2)  a power purchase agreement  for  all
electricity, steam and other commodities related to such Projects.

<PAGE>

3.3       PROJECT SERVICES AND PRODUCTS.   Absent  a  specific agreement to
the contrary for a particular identified project, ASI will be the exclusive
provider  of  ASI  Services  on  Projects.  ASI will further  be  primarily
responsible for implementation of  the  Optimization  and  O&M Services for
Utility  System  Assets,  including  the  oversight of the engineering  and
implementation  of all power generation development  or  upgrade  projects.
Where  appropriate   and   to   the   extent   possible,  ASI  will  supply
equipment/products  for  steam  generation  and  related  utility  systems.
Appropriate  contracts  will  be  prepared  and  executed  by  the  parties
outlining the specific EPC and O&M services to be  provided  by  ASI.   The
parties   may  enter  into  contracts  with  third  party  contractors  for
additional  services  required for individual projects as may be determined
to be necessary and appropriate.   ASI  will be responsible for the payment
of costs of third party contractors or which  it has engaged to fulfill its
responsibilities under this Agreement, or under  applicable agreements with
Operating Companies, provided that major  equipment  purchases  may require
financing  by  or through APP.  APP will be responsible for the payment  of
costs  of  development   related   services,  including  marketing,  sales,
development/discovery  engineering,  financial  and  legal  expenses.   All
outside costs and expenses incurred by  the  Parties  may  be  periodically
reviewed,  analyzed  and adjusted upon request of and by agreement  of  the
Parties.

                                 ARTICLE 4
                                EXCLUSIVITY

4.1       EXCLUSIVITY AND  NON-CIRCUMVENTION.   During  the  term  of  this
Agreement,  APP and ASI intend and agree to work jointly and exclusively to
market and develop  Projects within the Business Scope, subject only to the
provisions of SECTION  4.2  hereof.  APP and ASI shall each offer the other
the opportunity to participate to the  extent  set out in this Agreement in
every  Project or potential Project within the Business  Scope,  except  in
such situations  as  are hereinafter described in SECTION 4.2.  The Parties
further intend and do  hereby agree that all of the Parties' Affiliates and
their employees, agents  or  representative  shall be bound by the terms of
exclusivity as set forth herein, subject only  to the provisions of SECTION
4.2.  Notwithstanding the terms of the Business Scope as defined in SECTION
2.2 and the geographical limitations therein, to  the extent practical, ASI
shall  treat APP as the preferred provider of APP Services  and  APP  shall
treat ASI  as  the  preferred provider of ASI Services in all international
territories or locations  in  which  the  Parties  may be found to be doing
business.

4.2  EXCEPTIONS TO EXCLUSIVITY.

             (a) The provisions of SECTION 4.1 shall  not be interpreted in
any  manner to require or obligate ASI to work exclusively  with  APP  with
respect  to:   (i)  potential  or  existing projects which fall outside the
Business Scope; (ii) projects on which  ASI is invited or allowed to submit
bids  or  proposals  for products or services  to  or  for  energy  service
companies; or (iii) projects  undertaken  by  ASI  in which ASI has entered
into  a  legally  binding  agreement prior to the effective  date  of  this
Agreement.

     (b) The provisions of SECTION  4.1  shall  not  be  interpreted in any
manner to require or obligate APP to work exclusively with ASI with respect
to  (i) potential or existing projects which fall outside of  the  Business
Scope;  (ii)  projects on which APP is invited or allowed to submit bids or
proposals for products or services related exclusively to matters which are
outside the scope  of  ASI Services; or (iii) projects undertaken by APP in
which  APP has entered into  a  legally  binding  agreement  prior  to  the
effective date of this Agreement.

<PAGE>

     In  the  event  that APP and ASI are not obligated to work exclusively
with each other under  the  terms of this SUBSECTION 4.2(A) OR (B), APP and
ASI may not use or disclose to  any third party any work product previously
developed or provided by the other Party or any Confidential Information as
the case may be, in regard to the project in question.

                                 ARTICLE 5
                            STEERING COMMITTEE

5.1    APP and ASI hereby establish  a committee (the "Steering Committee")
for the purpose of managing and directing the joint pursuits of the Parties
under the terms of and consistent with  the  provisions  of this Agreement.
The  Steering  Committee  shall  be composed of one or more representatives
(each a "Steering Committee Representative")  from  each  Party;  and  each
party  shall  have the right to appoint an equal number of Representatives.
The first Representatives are:

                             Douglas V. Bloss
                               Mark Margason

Decisions requiring  approval of the Steering Committee and functions to be
performed include: (i)  analysis  and  evaluation  of  Projects and Project
opportunities,  (ii)  coordination  of  proposal preparation  and  business
development   activities,   (iii)   any   Project-specific   profit-sharing
arrangements; and (iv) any other matter submitted to the Steering Committee
by either of the Parties for consideration/decision.

                                 ARTICLE 6
                            OPERATING COMPANIES

6.1  OPERATING COMPANIES.  APP and ASI may  from  time  to  time  form  and
establish Entities as are authorized by the laws of any individual State or
of  the  United States of America ("Operating Companies") which shall enter
into  contracts   with  End  Users  to  perform  Services  associated  with
individual Projects which are to be developed jointly by the Parties.

6.2  MANAGEMENT OF  OPERATING COMPANIES.  Any Operating Company established
by the Parties as contemplated  by  this Agreement shall be managed jointly
by the Parties through their designated  managers  or representatives.  All
appropriate agreements and documents will be prepared  by  the  Parties  to
establish the management structure and additional details for the operation
of any business Entity formed for the individual Projects undertaken by the
Parties.

6.3  CAPITAL  CONTRIBUTIONS AND EQUITY OWNERSHIP.  APP shall be responsible
for  structuring   appropriate   financing  as  may  be  required  for  the
Monetization and/or Optimization of Utility Systems Assets for all Projects
to be pursued or undertaken by the  Parties.   Absent  an  agreement to the
contrary  by the Parties, APP will provide all equity contributions,  which

<PAGE>

may  be  required   for   all   future  individual  Projects  and  for  the
capitalization of Operating Companies  as  may be established in accordance
with this ARTICLE 6.  However, ASI will have  the  right  to participate in
the  ownership  of  each  Project  undertaken  by  the  Parties.   ASI  may
contribute  up  to  fifty  percent  (50%)  of  the required equity for each
individual Project and shall hold a corresponding ownership interest in the
Project  and/or  any  Operating  Company  formed by the  Parties  for  said
Project,  in accordance with the terms of this  Agreement.   Prior  to  the
execution of  the  definitive  agreements  and  related  documents for each
individual Project undertaken by the Parties, ASI shall advise  APP  as  to
whether  it  intends  to contribute capital and take a corresponding equity
ownership interest in the  Project  and  any  Operating  Company  as may be
established in accordance with this ARTICLE 6.  APP and ASI shall each hold
the  right  of  first  refusal for the purchase of the other Party's equity
position in the event of  a  sale  of  equity  in  a  Project  or Operating
Company.

                                 ARTICLE 7
                         FINANCIAL, ACCOUNTING AND
                           ALLOCATION OF PROFITS

7.1  ACCOUNTING  AND  RECEIPT/DISTRIBUTION  OF  REVENUES.   All  financial,
accounting and related functions for Projects, including the administration
of  customer  bills for utilities and commodities, if applicable, shall  be
performed by APP.  All revenues derived from Services performed or products
provided pursuant  to  the  terms  of  this  Agreement  by  the Parties, or
payments  in  respect  of a customer's utilities provided pursuant  to  any
contract or agreement entered into by any Operating Company formed pursuant
to this Agreement, shall  be paid to and received by the Operating Company.
The financial statements of  the  Operating  Companies will be consolidated
with the financial statements of APP.  The Parties  agree  to  prepare  and
distribute  with reasonable promptness financial statements and reports for
all Projects and/or Operating Companies, which reports shall be prepared in
accordance with  generally  accepted  accounting  principles  on  a monthly
basis.

7.2  PROJECT PROFIT ALLOCATION.  The allocation and distribution of profits
and  losses derived from the operations of the Parties under this Agreement
shall  be  determined  and  made  in  accordance with the provisions of the
attached EXHIBIT A.

7.3  OPEN BOOK.  All Projects pursued and/or  undertaken  by  APP  and  ASI
shall be on an "Open Book Basis", with both Parties allowed complete access
to  all financial materials, records or reports which are in anyway related
to the Projects, Operating Companies, or related activities of the Parties.

                                 ARTICLE 8
                           TERM AND TERMINATION

8.1  TERM.   Except  as otherwise provided herein, this Agreement remain in
effect until terminated in accordance with SECTION 8.2.

8.2  TERMINATION.  This  Agreement may be terminated upon the occurrence of
any of the following events:

<PAGE>

     (a)  Either Party may  terminate  this  Agreement  upon  providing six
months' written notice of termination to the other Party, said notice to be
delivered in accordance with the requirements of this Agreement; or

     (b) Upon the occurrence of any default by a Party in:

          (i) the payment of any fee or other payment obligation under this
     Agreement,  where  such  default  remains unremedied  for a period  of
     twenty (20) days after written notice  of  the default is given to the
     defaulting  party,  provided that such written  notice  shall  not  be
     required if a default  under  this subsection occurs more than one (1)
     time in any calendar year; or

          (ii) the non-performance of  any  covenant  or  agreement by such
     party in this Agreement where such default continues unremedied  for a
     period  of  twenty  (20) days after written notice thereof is given by
     the non-defaulting party to the defaulting party.

The non-defaulting party may,  at its sole option, by giving written notice
thereof  to the defaulting party,  terminate  its  obligations  under  this
Agreement,  without  in any way affecting the non-defaulting party's rights
under this Agreement.

     (c)  If any representation  or  warranty  by a Party in this Agreement
proves to have been incorrect or misleading in any  material  respect as of
the  date when made or deemed made, then the non-defaulting party  may,  at
its sole  option, by giving written notice thereof to the defaulting party,
terminate  its  obligations  under  this  Agreement,  without  in  any  way
affecting the non-defaulting party's rights under this Agreement; or

     (d)  If  a  Party  is  generally unable to pay its debts as such debts
become due, or shall admit in  writing  its  inability  to  pay  its  debts
generally, or shall make a general assignment for the benefit of creditors;
or  any  proceeding  shall  be  instituted by or against a party seeking to
adjudicate it a bankrupt or insolvent,  or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition
of it or its debts under any law relating  to  bankruptcy,  insolvency,  or
reorganization  or  relief of debtors, or seeking the entry of an order for
relief or the appointment of a receiver, trustee, or other similar official
for it or for any substantial part of its property then the other party may
terminate this Agreement.

8.3  EFFECT OF TERMINATION.  In the event of termination of this Agreement,
the  obligations  and rights  of  the  Parties  incurred  pursuant  to  any
provision of this Agreement,  or  by virtue of any contract entered into by
the Parties for Project Services or  materials  undertaken  jointly  by the
Parties,  shall  continue  in  full force and effect until such obligations
have been fulfilled, and the rights and obligations of the Parties pursuant
to ARTICLES 10, 13 AND 15 shall additionally survive termination.

<PAGE>

                                 ARTICLE 9
                                WITHDRAWAL

9.1  WITHDRAWAL FROM A PROJECT.  With respect to any particular transaction
involving a Project, either Party may notify the other of its desire not to
proceed  with  the development of  such  Project;  provided,  that  (i)  an
election by either  Party  to  withdraw from a Project shall not affect the
rights of the other Party to proceed  with such Project, (ii) neither Party
may withdraw from a project during the  period  between the submission of a
proposal  to  an  End-User and the earlier of the date  that  the  proposal
expires by its own  terms  or  the  date  upon  which an agreement with the
customer  is  executed  in  respect  of  such Project unless  the  End-User
consents to such withdrawal and the proposal  is  otherwise  not  adversely
affected,  and (iii) after the execution of an agreement with the customer,
the Party desiring  to  withdraw  receives  the  consent of the End-User in
accordance with any instructions for the bidders provided  by  the End-User
(to  the  extent  required  and  otherwise  does so in compliance with  the
applicable agreements) and provided that such withdrawal does not adversely
affect  the  ability  of the non-withdrawing Party  to  continue  with  the
Project.  Any Party, which  elects to withdraw in compliance with the terms
of this SECTION 9.1, will be  released  from  any  liability  or obligation
under this Agreement with respect to the relevant Project accruing from the
date  of  withdrawal.   If  the  written  notice  of  withdrawal  is  given
subsequent  to  the  posting  by  the  Parties of any bid bond or other bid
security as required in connection with  the  proposal  process,  then  the
withdrawing  Party  shall indemnify (excluding lost profits, lost revenues,
indirect, special or  consequential  damages)  the  other  Party  from  any
liability  resulting  from  the  forfeiture  of  such bid bond or other bid
security caused by the withdrawing Party's decision  to  withdraw.   If any
Party  determines  to withdraw from any Project, such Party agrees that  it
shall use its reasonable  efforts to withdraw from such Project in a manner
that permits the non-withdrawing Party to continue the proposal process for
such Project and causes the  least  harm  possible  to  the non-withdrawing
Party, provided that the withdrawing Party shall not be required  to expend
any further funds or incur additional liabilities to do so.

9.2  EXCLUSIVITY UPON WITHDRAWAL.  Notwithstanding anything herein  to  the
contrary,  the  withdrawing Party shall be prohibited from participating in
or pursuing any Project alone with any other person or entity.

                                ARTICLE 10
                              CONFIDENTIALITY

10.1 ASI  DISCLOSURES.    ASI  may  disclose  various  information  to  APP
including:  (a)  information  regarding  the  ASI  products,  services  and
systems, the identity  of potential and existing customers and contacts and
such other information as may be reasonably required to implement the joint
marketing and servicing  efforts  of  the  Parties  as contemplated by this
Agreement.

10.2 APP  DISCLOSURES.  APP  may  disclose  various  information   to   ASI
including:  (a)  information  regarding  the  strategies and services to be
provided  by  APP,  the identity of potential and  existing  customers  and
contacts, and such other  information  as  may  be  reasonably  required to
implement  the  joint  marketing  and  servicing efforts of the Parties  as
contemplated by this Agreement.

<PAGE>

10.3 CONFIDENTIAL TREATMENT.  Neither APP  nor ASI shall disclose the other
Party's Confidential Information without the  other  Party's  prior written
consent: PROVIDED, HOWEVER, a Party may disclose:

                   (a) any of the other Party's Confidential Information to
        a Party's Representative, who needs to know and agrees  to maintain
        the  confidentiality of such Confidential Information in accordance
        with the terms hereof; and

     (b) any of  the  other  Party's  Confidential  Information  that:  (i)
        becomes generally available to the public; (ii) is already known to
        the  Party  at  the time of disclosure by the other Party; (iii) is
        acquired from a third  party not known by the receiving Party to be
        prohibited  from making disclosure;  or  (iv)  is  required  to  be
        disclosed to  comply  with any applicable law, order, regulation or
        ruling.

10.4 RETURN OF CONFIDENTIAL INFORMATION.  Upon a Party's request, the other
Party shall destroy all written  Confidential Information of the requesting
Party, except for that portion of such Confidential Information that may be
found in analyses, compilations, studies or other documents prepared by, or
for,  the  non-requesting  Party, and  the  non-requesting  Party  and  its
Representatives shall not retain  any  copies  of such written Confidential
Information.  The portion of written Confidential  Information  that may be
found in analyses, compilations, studies or other documents prepared by, or
for,  the  returning party, any oral Confidential Information furnished  by
the requesting  Party  not  requested  to be destroyed, will be held by the
non-requesting Party and kept subject to the terms of this Agreement.

10.5 LIABILITY FOR REPRESENTATIVES.  A Party  shall  be held liable for any
breach by any of its Representatives of the provisions of this ARTICLE 10.

                                ARTICLE 11
                         EMPLOYEES OF THE PARTIES

11.1 NON-SOLICITATION OF EMPLOYEES.  During the term of  this Agreement and
continuing for one (1) year thereafter, each Party agrees not to solicit or
hire  employees  of the other Party unless the Party which is  the  current
employer of the employee in question has consented in writing thereto.

11.2 COSTS OF CERTAIN EMPLOYEES ENGAGED IN BUSINESS DEVELOPMENT.  APP shall
reimburse  ASI  for   the  costs  associated  with  certain  ASI  employees
(including salary, benefits  and  travel  costs)  during  the  term of this
Agreement.   Such  employees  shall remain the employees of ASI, but  shall
work exclusively on marketing and  development  of  Projects  to be pursued
jointly by ASI and APP.  All such employees shall be identified  and agreed
to by the Parties in writing. All such employees shall be subject to review
by  the  Parties no less frequently than on an annual basis, and each  such
employee's assignment to work on ASI/APP marketing and business development
(with reimbursement by APP) hereunder shall be discontinued if the employee
does not perform  to  the  satisfaction  of  both ASI and APP.  In the case
where an employee's assignment is discontinued hereunder, the Parties shall
agree upon a replacement.  No employees whose  costs  are  reimbursed under
this Section 11.2 shall be used to conduct marketing or other activities in
territories  or  areas  where  either  ASI  or  APP are under legal  and/or
contractual  restriction  against  conducting  such  marketing   or   other
activities.

<PAGE>

                                ARTICLE 12
                                  NOTICES

12.1 NOTICES TO THE PARTIES.  All notices or other communications hereunder
shall  be in writing and shall be delivered either personally, by facsimile
means  (delivered  during  the  recipient's  regular  business  hours),  by
registered   or   certified   mail  (postage  prepaid  and  return  receipt
requested),  or  by  express courier  or  delivery  service,  addressed  as
follows:

If to Americas Power Partners Inc.:

          105 East First Street
           Hinsdale, Illinois  60521
           Phone No.: (630) 325-9111
           FAX No.:   (630) 325-9606
           Attn:  Mark A. Margason

     WITH A COPY TO:

          710 N. York Road
          Hinsdale, Illinois 60521
          Attn:  John K. Leach

IF TO ARMSTRONG SERVICE, INC.:

          2081 East Ocean Blvd.
          Stuart, Florida 34996
          Phone No.: (561) 286-7175
          FAX No.:   (561) 286-1001
          Attn.: Douglas V. Bloss, and J. Thomas Morris

     WITH A COPY TO:

          8545 Commodity Circle
          Orlando, Florida  32819
          Attention: Mark Quirin

Or at such other address  and  number  as  any  Party shall have previously
designated  by  written  notice  given  to the other Party  in  the  manner
hereinabove set forth.  Notices shall be  deemed  given  when  received, if
sent  by  facsimile  means  (confirmation  of  such  receipt  by  confirmed
facsimile  transmission  being  deemed  receipt  of communications sent  by
facsimile means), and when delivered and receipted for (or upon the date of
attempted delivery where delivery is refused), if  hand-delivered,  sent by
express  courier  or  delivery  service, or sent by certified or registered
mail.

<PAGE>

                                ARTICLE 13
                              INDEMNIFICATION

13.1 RECIPROCAL  GENERAL INDEMNIFICATION.   Each  Party,  respectively,  as
indemnitor, will indemnify,  defend  and  hold harmless the other Party and
its  officers, directors, employees, Affiliates,  agents  and  assigns,  as
indemnitees,  from  and  against  any and all losses, liabilities, damages,
demands, claims, actions, judgments or causes of action, assessments, costs
and  expenses,  including,  without  limitation,  interest,  penalties  and
reasonable  attorneys'  and  accountants'   fees,   but  excluding  amounts
described  in  SECTION  15.3  hereof  (herein referred to  collectively  as
"Losses")  asserted against, resulting to,  imposed  upon  or  incurred  or
suffered by any such indemnitee as a result of, based upon or arising from,
the failure  by  the  indemnitor  or  its respective agents or employees to
comply with any applicable Law, rule, or regulation of any authority having
proper  jurisdiction,  or  the  breach  or nonfulfillment  of  any  of  the
representations, covenants or agreements made by the indemnitor pursuant to
this  Agreement,  excepting  only such Losses  as  may  be  caused  by  the
negligence or misconduct of any  indemnitee  or  its  respective  agents or
employees.

                                ARTICLE 14
                                 INSURANCE

14.1 INSURANCE.   Each  of  ASI  and  APP  shall  procure and maintain such
policies  of liability and property insurance as shall  be  reasonable  and
customary for  companies  and  business  activities of the nature and scope
contemplated  herein.  Each  Party  agrees  to   provide   information  and
certificates to the other from time to time to confirm compliance with this
Section.

14.2 WAIVER  OF  SUBROGATION.   ASI  and  APP  agree  that all policies  of
insurance procured hereunder shall contain waivers of subrogation, provided
that neither Party shall be deemed to have waived subrogation  in  any case
where  the  other Party has not complied with the requirements of procuring
and maintaining coverage pursuant to SECTION 14.1.

                                ARTICLE 15
                            DISPUTE RESOLUTION

15.1    BY THE  PARTIES.   In  the event of any conflict or dispute between
the Parties to this Agreement, which  dispute is not resolved within thirty
(30) days, then each Party agrees to submit  the  dispute  to  the  highest
ranking executive officer of the respective Parties.

15.2      ARBITRATION  If any dispute is not resolved between the executive
officers as indicated in SECTION 15.1 above within sixty (60) days from the

<PAGE>

date on which  the  executive  officers  began  to  attempt to resolve such
dispute,  then the dispute shall be determined by arbitration  pursuant  to
the rules, then in effect, of the American Arbitration Association upon the
initiation  of either Party, and shall be settled and finally determined by
an arbitrator  mutually  acceptable  to  both  Parties.  If the Parties are
unable to agree upon a single arbitrator, each Party,  at  its own cost and
upon notice to the other Party, shall appoint one arbitrator.   If  a Party
does  not  appoint  an  arbitrator  within ten (10) Business Days after the
other Party has given notice of the name  of  its appointed arbitrator, the
single arbitrator first appointed shall be the  sole  arbitrator,  and that
arbitrator's   decision  shall  be  binding  upon  both  Parties.   If  two
arbitrators are  appointed,  they shall appoint a third arbitrator, and the
three shall resolve the question.   The appointment of the third arbitrator
shall be made within ten (10) Business  Days  following  the appointment of
the  first two arbitrators.  If the two arbitrators first appointed  cannot
agree  upon  a  third,  that  third arbitrator shall be chosen by the Chief
Judge or highest ranking judge  of  the  Superior  Court  for  the judicial
district  or  circuit  comprising  or including Wilmington, Delaware.   The
written  decision  of  any two of the arbitrators  so  appointed  shall  be
binding and conclusive on  the  Parties hereto and enforceable in any court
of competent jurisdiction.   Each of the Parties shall bear one-half of the
cost  of  appointing  the  third  arbitrator,   and  of  paying  the  third
arbitrator's  fee.   Such  arbitration  shall be conducted  in  Wilmington,
Delaware.

     15.3 LIMITATION  ON  LIABILITY.   Notwithstanding   anything   to  the
contrary  herein  contained,  neither  Party  shall be liable to the other,
whether  in  contract, in tort, or otherwise, for  any  special,  punitive,
exemplary,  indirect,   incidental  or  consequential  damages  whatsoever,
including but not limited  to,  loss of profits, business interruptions and
claims of customers or other third parties, for any reason whatsoever.

                                ARTICLE 16
                         MISCELLANEOUS PROVISIONS

16.1 NO PARTNERSHIP/JOINT VENTURE  CREATED.  The Parties hereto acknowledge
and agree that this Agreement and the activities and projects to be pursued
hereunder do not constitute a Party being an agent, partner, joint venturer
or legal representative of the other Party for any purpose whatsoever.  The
Parties hereto further acknowledge and agree that a Party is not authorized
to assume or create any obligation, liability or responsibility, express or
implied, or to execute any document  or  instrument on behalf of, or in the
name of the other Party or to bind the other  Party  in any manner, without
such  Party's prior written consent.  The Parties hereto  also  acknowledge
and agree  that  the  relationship  intended  by  this Agreement is that of
independent contractors and not just of representatives, partners, or joint
venturers.

16.2 AMENDMENTS AND WAIVERS.  No amendment, waiver,  modification or change
of  this Agreement shall be enforceable unless in writing  signed  by  both
Parties hereto.

16.3 SUCCESSORS  AND ASSIGNS.  This Agreement shall be binding upon APP and
ASI, and their respective successors and assigns.  This Agreement shall not
be assignable by either  Party hereto except with the prior written consent
of the other Party, which  consent shall not be unreasonably withheld.  Any
such assignment shall not relieve  the  assigning  Party  of its obligation
hereunder.

<PAGE>

16.4 EXECUTION  OF  ADDITIONAL  INSTRUMENTS.  Each Party hereby  agrees  to
execute  such  other  and  further  statements  of interest  and  holdings,
designations, powers of attorney and other instruments  necessary to comply
with any laws, rules or regulations.

16.5 CONSTRUCTION.  Whenever the singular number is used  in this Agreement
and  when  required by the context, the same shall include the  plural  and
vice versa,  and the masculine gender shall include the feminine and neuter
genders and vice versa.

16.6   AUDIT RIGHTS.   APP and ASI shall keep accurate books and records in
accordance with the generally  accepted  accounting principles consistently
applied  to  all  costs  and  expenses incurred  in  connection  with  this
Agreement  (and  to be included in  the  calculation  of  profit  for  each
project) and the performance  of their respective obligations hereunder and
shall, to the extent available,  obtain  receipts  for  all expenditures in
connection with such costs and expenses.  The Parties shall  have the right
at  reasonable times and with reasonable notice, to examine the  books  and
records  of  the  other  relating  to revenues and expenses included in the
calculation of Project profit.

16.7 INVALIDITY.  In the event that any of the provisions contained in this
Agreement shall be held unenforceable in any respect, such unenforceability
shall not affect any other provision of this Agreement.

16.8 ENTIRE AGREEMENT.  This Agreement  embodies  the  entire agreement and
understanding between APP and ASI and supersedes all prior  agreements  and
understandings relating to the subject matter hereof.

16.9 GOVERNING  LAW.   THIS  AGREEMENT  SHALL BE GOVERNED BY, AND
CONSTRUED
INTERPRETED AND ENFORCED IN ACCORDANCE WITH,  THE  SUBSTANTIVE  LAW
OF THE
STATE OF DELAWARE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS.

16.10  COUNTERPARTS.   This  Agreement  may  be  executed  in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.

IN WITNESS WHEREOF, the Parties hereto, by their respective duly authorized
Representatives,  have  executed  this Agreement effective as of  the  date
first above written.

AMERICAS POWER PARTNERS, INC.           ARMSTRONG SERVICE, INC.

By:____________________________         By: ___________________________
Name: _________________________         Name: _______________________
Title:  __________________________      Title:  _________________________

<PAGE>

                                 EXHIBIT A
                        PROJECT PROFIT ALLOWCATION
                               (Section 7.2)

It is the intention of the Parties  that  insofar  as  possible  and unless
otherwise  agreed  in  writing,  project  revenues  and  profits  shall  be
allocated and distributed to the parties such that:

          (i)  Each  of  ASI  and  APP shall receive compensation for their
               respective roles (including,  without limitation, ASI's role
               in providing EOPC and O&M Services,  APP's role in providing
               project financing and administration,  as  well as the roles
               of  both parties in project development) in order  to  cover
               costs  and provide reasonable profits and/or returns to both
               parties for such efforts at market rates; and
          (ii) Remaining  profits  after  payment  of  the  compensation in
               paragraph (a) shall be shared equally between ASI and APP.

Profits  and losses will be determined and allocated to the Parties  on  an
individual  Project  basis.  All Project accounting will be performed on an
open book basis.

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