Document:

EXHIBIT 10.1

AGREEMENT made and entered into this 29th day of October, in the year 2002 by
and between the City of New York, acting through its Department of Information
Technology and Telecommunications, having offices at 11 MetroTech Center,
Brooklyn, New York 11201, and Plangraphics, Inc. located at 112 East Main
Street, Frankfort, Ky, 40601. (hereinafter referred to as "Contractor").

                                   WITNESSETH:

WHEREAS, Geographic Information Systems (GIS) are understood to be an essential
means by which the City can organize and represent its data and develop useful
applications that enhance City operations and improve the quality of life for
City residents and workers;

WHEREAS, GIS has been found to enable public safety agencies such as the Police
Department, Fire Department and the Department of Emergency Management to
organize their operations and select effective strategies to insure the safety
of New Yorkers;

WHEREAS, to provide for continued GIS services to the City and to enable the
further development of the Citywide GIS Utility and Program, the City of New
York issued a Project Definition (PD) in accordance with the provisions of the
State of New York's GIS System Integration Backdrop Contract;

WHEREAS, in response to said solicitation, Contractor submitted a Project
Mini-Bid Proposal ("Proposal") dated January 21, 2002, a copy of which is
included herein as Exhibit "4";

WHEREAS, the City has determined that the Contractor's Proposal meets City needs
for GIS services in that their response was determined to be the most
advantageous to the City;

WHEREAS, at the conclusion of the evaluation of the proposals received in
response to the City's PD solicitation the City has decided to award an
agreement to Plangraphics,

NOW THEREFORE, the parties hereto agree to the Contract as follows:

Article I.          SUBJECT MATTER OF AGREEMENT

The Contractor shall provide the City with System Integration and Implementation
Services For The Citywide Geographic Information Systems Utility as further
defined in PD, which is made part of this Agreement as Exhibit "2".

Article II.         TERM OF AGREEMENT

The term of this Agreement shall commence upon notice to proceed following
registration by the Comptroller and conclude three (3) years thereafter, with
the option to extend for two (2) additional one (1) year periods at the City's
sole discretion.

Article III.        PRICE PAYMENT TERMS

A.   Pricing

The City shall pay Contractor pursuant to the terms and conditions of this
Agreement, a total not-to-exceed amount of $15,439,900.00, based on Fixed Cap
Hourly Rates for consultant's job titles/levels of expertise as specified in the
Contractor's Proposal, which is made part of this Agreement as Exhibit "4".

The City reserves the right to spend less than the total not-to-exceed amount of
$15,439,900.00 specified in this Agreement.

The total not-to-exceed dollar amount represents the maximum spending "cap"
associated with this contract action, and is not a guarantee that this or any
sum has been committed to by the City. No fees will be paid and/or assured by
the City beyond the costs associated with approved task orders released against
this Agreement; all of which shall be subject to the terms of this Agreement

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B. The Contractor shall submit invoices on a monthly basis. Each of the monthly
invoices shall be billed by the actual hours expended during that period on
project activities and the invoice submitted reflects the total number of hours
per consultant multiplied by that consultant's job title/level of expertise
hourly rate, and shall be supported by time sheets of the individuals performing
work during the monthly period. All invoices shall list the number of hours per
resource expended and the hourly rate charged.

As stated in the Contractor's Proposal, there shall be no separate
reimbursements for benefits, profit, overhead, administrative costs, travel and
all other expenses in connection with the services as required hereunder.

Article IV.         INCORPORATION

During the contract term, conflicts between the various documents [including the
Back-Drop Contract, Mini-Bid Project Definitions, Contractor's Proposal, and any
negotiated statement of work between Contractor and the City] shall be resolved
in the following order of precedence:

Exhibit 1:  Appendix A - Standard Clause for NYS Contracts
Exhibit 2:  Project Mini-Bid Project Definition
Exhibit 3:  RFP# S960275-E (Contract Document, including Appendix B)
Exhibit 4:  Contractor's Project Mini-Bid Proposal
Exhibit 5:  RFP# S960275-E, Contractor's Back-Drop Contract Proposal

The documents referenced above constitutes the entire Agreement between the
parties thereto and no statement, promise condition, understanding, inducement
ore representation, oral or written, expressed or implied, which is not
contained herein shall be binding or valid and these contracts shall not be
changed, modified or altered in any manner except by an instrument in writing
executed by both parties hereto.

Article V.          TASK LEVEL DOCUMENTATION

The contractor shall develop under the supervision of the Department of
Information Technology and Telecommunication's (DOITT) Citywide GIS Utility and
Program detailed descriptions of all tasks to be performed by the contractor
during the three to five year term of the contract.

Task descriptions shall contain the following components:

1.   Task Description: A short description of the task and task title.
2.   Description of Task's Relationship To Building of the GIS Utility: A
     description of how the task relates to other tasks and how it also relates
     to the building of the overall GIS Utility.
3.   Task Objectives and Deliverables: A description of task objectives and the
     specific deliverables associated with the task. Acceptance testing
     requirements will be specified.
4.   Task Quality and Technical Standards: Quality and technical standards that
     tasks deliverables are required to meet.
5.   Benefits Expected To Be Realize Through Completion of the Task: A concise
     cost benefit analysis that relates expected benefits of using the
     deliverable to the cost of creating it.
6.   Task Steps, Step Descriptions, Expected Step Durations, Expected Step
     Hours, Expected Step Costs: A spreadsheet that lays out the various task
     steps with their cost and duration metrics with a focus on consultant
     costs.
7.   Other Resources Necessary To Complete Task (HW, SW, Supplies, etc.): A
     listing of other cost components making up the deliverable or required for
     its development.
8.   Total Cost Estimates: The combination of item 6 and item 7 into a total
     task cost figure.
9.   Staff Assigned To Task Including Project Manager: Contractor's staff
     assigned to the task with a responsible project manager.
10.  Expected Maintenance and Support: Assessment of costs and work associated
     with maintaining and supporting the deliverable beyond the scope of the
     task order.
11.  Risks, Concerns, Issues: A description of any relevant factors concerning
     the task that might influence its successful development, completion and
     use.
12.  Task Status Log: Record of all significant events in the progress of the
     task including all modifications made.
13.  Task Completion Report: A final report on the task and its deliverable with
     any lessons learned or other considerations

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It is understood that the contractor may encounter unexpected obstacles in the
carrying out of a task order towards the development of a deliverable. When
these obstacles delay the task and are caused by factors outside the reasonable
control of the contractor, they will be duly noted in the contract task log, but
the contractor will not be penalized for such delays.

It is understood that should there be a reordering of priorities by the City,
some tasks may be cancelled, postponed or delayed, while other tasks substituted
or accelerated. All such modifications will be duly noted in the contract task
log and through the development of new task orders. When such modifications are
by order of the City, the contractor will not be penalized for such changes but
will receive full compensation for all work performed.

It is understood that should the City not successfully complete a task with
associated deliverables due to the failure of the contractor that the contractor
shall reimburse the City for all or a percentage of the task cost already paid.
All such determinations and actions will be noted in the contract task log.

Article VI.         CURRENT STATUS

The GIS Utility has been able to scope out a number of tasks and deliverables it
wishes to complete over the next fifteen months through June 2003. These tasks
and deliverables, as they pertain to this contract, include the following:

1.   Continue development of the GIS Utility Data Repository
2.   Metadata dictionary
3.   Data model
4.   GIS Utility Intranet Website
5.   PC Geo TCPIP Connection to GeoSupport
6.   Data access utilities
7.   Develop other strategic GIS data and graphic layers including zip codes,
     landmark districts and sites, bus lines, fiber and cable infrastructure,
     pay public telephones, fire hydrants, etc. Develop strategic infrastructure
     layer identifying important and vulnerable infrastructure elements
8.   Develop/acquire a routing database for vehicle fleets, emergency vehicles
     and other field forces
9.   Develop a unified street name and address database for geosupport and
     computer aided dispatch
10.  Study data rich and strategic agency databases and incorporate key data
     elements into the GIS Utility for common usage.
11.  Develop specifications and franchise terms to oblige City utility companies
     to register their infrastructure drawings infrastructure drawings to
     NYCMAP.
12.  Develop a "My Neighborhood" application providing valuable information in a
     GIS format to the public through the City's web portal
13.  E-Gov Applications for agencies including "CapApp" an application
     presenting data about the City's capital projects past, present and future.
14.  Develop other agency oriented applications as appropriate and as funds
     allow.
15.  City agency collaborative work: Conduct needs assessment and pilot projects
     with/for selected City agencies to build GIS capacity and prove GIS
     efficacy.

Article VII.        IMPLEMENTATION OF TASK ORDER SYSTEM

Based upon the above terms, the GIS Utility will develop detailed task orders.
These tasks, through the task log, will be tracked and kept up to date. As tasks
are completed, a task completion report will be written to close the task out.

As additional tasks are identified or as other City agencies, with their own
funding, choose to use the DOITT contract and its contractor to conduct needs
assessments, develop data layers or create applications; the GIS Utility will
continue to put in place Task Orders to cover this additional work.

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<PAGE>

Article VIII.       PURCHASE OF INCIDENTAL HARDWARE, SOFTWARE AND OTHER
                    EQUIPMENT

If the parties mutually agree that any Task Order requires the provision of
third party products, including hardware, software or other equipment, the
Contractor, shall provide such products subject to a limit of no more than ten
percent (10%) of the total contract amount. Any hardware, software or other
equipment purchased by the City pursuant to this Letter Agreement shall be
available at prices at or below those prices provided under the OGS Contract
(the "Backdrop Contracts"), and at terms and warranties at least as favorable as
those terms provided under such Backdrop Contracts. The City shall be
responsible for the execution of any license agreements for such third party
products. Nothing herein is intended to establish an exclusive arrangement
between the City and the Contractor.

Article IX.         RIGHTS IN DELIVERABLES.

(A) As used in this Agreement, the term "Deliverables" shall mean reports,
documents, templates, studies, strategies, operating models, technical
architectures, designware, software objects, software programs, source code,
object code, specifications, documentation, abstracts and summaries thereof, and
other work product and materials which are originated and prepared for the City
and delivered by Contractor (either independently or in concert with the City or
third parties) during the course of Contractor's performance under this
Agreement. Upon payment, the City shall have a perpetual, nontransferable,
non-exclusive paid-up right and license to use, copy, modify and prepare
derivative works of the Deliverables, subject to any restrictions of any
third-party materials embodied in the Deliverables and disclosed to the City.
The City's rights in the Deliverables shall be for purposes of the City's
business and, to the extent any Deliverable contains confidential information of
Contractor, shall be subject to the paragraph (B) directly below. All other
intellectual property rights in the Deliverables remain in and/or are assigned
to Contractor. The parties shall cooperate with each other and execute such
other documents as may be reasonably deemed necessary to achieve the objectives
of this paragraph.

(B) Contractor will provide the City access to its tools, methodologies, assets,
construction aids that are applicable to the project and the City shall have the
right to use, subject to the terms of the license, such assets during and after
the project. Such assets are owned by Contractor or by third parties
(collectively "Proprietary Items"). As between the City and Contractor,
Proprietary Items will be deemed confidential information of Contractor. The
City shall have or obtain no rights in such Proprietary Items (or in any
modifications or enhancements to them) other than (i) to use them as authorized
by Contractor in writing from time to time solely for purposes of performing its
responsibilities hereunder, (ii) to the extent the Proprietary Items are
incorporated into a Deliverable, to use them as part of the Deliverable for
purposes of the City's business only, or (iii) pursuant to Contractor's standard
license for such Proprietary Items or, in the case of Proprietary Items owned by
third parties, pursuant to terms acceptable to the applicable third party. If
Proprietary Items are made available to the City under (i) or (ii) above, they
will be made available in an "AS IS" condition and without express or implied
warranties of any kind; those Proprietary Items made available under (iii) above
shall be subject only to applicable terms of the applicable license.

Article X.          NON-FUNDING CLAUSE

Each payment obligation of the City created by this Agreement, or any Exhibit
attached hereto is conditioned upon the availability of City funds, which are
appropriated or allocated for the payment of such an obligation.

Article XI.         CHANGE ORDER PROVISIONS

This Agreement may be modified in writing by the parties from time to time to
provide for the provisions of the performance of services and/or work
(hereinafter singly and collectively referred to as "Extra Work") in addition to
those presently stated or implied to be provided and/or performed pursuant to
the terms and conditions of this Agreement, or for the omission of services or
work previously provided for, in order to carry out and complete more fully and
perfectly this Agreement. Plangraphics and City understand and agree that in no
event shall the cost of any Extra Work have the effect of increasing the total
amount payable by City to Plangraphics pursuant to this Agreement by an amount
in excess of Ten Per Cent (10%) of the maximum amount first set forth in Article
III of this Agreement, unless such additional cost is authorized by any
governmental body or bodies of The City of New York authorized to approve City's
expenditure of monies. An order for Extra Work shall designate the method for
timely payment therefor, and shall be valid only if issued in writing and signed
by DoITT.

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Article XII.        PROJECT MANAGEMENT

All notices required or permitted under this Agreement shall be in writing and
shall be given, made or served by mailing the same by Registered or Certified
Mail, Return Receipt Requested, or U.S. Mail, or delivered by hand delivery, to:

Plangraphics , Inc., 112 East Main Street, Frankfort, Ky, 40601, Attn: Mr. Gary
Reed, Chief Operating Officer, e-mail: garyreed@plangraphics.com, Tel:
1-800-788-2008 with copies to: Plangraphics, Inc. 1300 Spring Street - Suite
210, Silver Spring, MD 20910, Attn: Mr. Richard Goodden, Vice President, Eastern
Region, e-mail: rgoodden@plangraphics.com, Tel: 1-301-588-8535 and Plangraphics,
DoITT, 59 Maiden Lane, 33rd Floor, New York, NY 10038, Attn: Mr. Jim Hall,
Project Manager, e-mail: jhall@plangraphics.com.

Department of Information Technology and Telecommunications, 11 Metrotech
Center, 5th Floor, Brooklyn, NY 11201, Attn: Mr. Joseph Maltese, Assistant
Commissioner/ACCO, or at such other address(es) as such parties shall, from time
to time designate by notice given to the other as hereinabove provided.

Article XIII.       TAXPAYER AFFIRMATION

Contractor affirms that Contractor is not in arrears to the City of New York
upon debt or contract, or taxes, and is not a defaulter as surety or otherwise,
upon obligation to the City of New York, and has not been declared not
responsible, or disqualified, by any agency of the City of New York, nor is
there any proceeding pending relating to the responsibility or qualification of
the Contractor to receive public contracts except:
____________________________________________________________________
____________________________________________________________________
____________________________________________________________________

                                   END OF PAGE

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<PAGE>

                                IN WITNESS, the parties hereto have executed
                                this Agreement on the date first written above.

                                THE CITY OF NEW YORK
                                Department of Information
                                Technology and Telecommunications

                                     By: /S/ (Signature illegible)
                                     -----------------------------

                                     Title: Assistant Commissioner/ACCO
                                     ----------------------------------

                                     Date: 10/29/02
                                     --------------

Plangraphics, Inc.

By: /S/ J. Gary Reed
--------------------

Title: Sr. Vice Pres/COO
------------------------

Date: 22 October 2002
---------------------

EIN: 61-0954403
---------------

Approved as to Form                          Approved as to Form
Certified as to Legal Authority              Certified as to Legal Authority

/S/ Gary W. Murphy                           /S/ Steve Stein Carter
------------------                           ----------------------
Acting Corporation Counsel                   NYC Acting Corporation Counsel
CFO/HSE Counsel

Dated: 22 October 2002                       Dated: Oct 24, 2002
----------------------                       -------------------

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<PAGE>

                     ACKNOWLEDGMENT BY THE CITY OF NEW YORK

STATE OF New York    )
                                    )  SS.:
COUNTY OF New York   )

ON THE 29 DAY OF October, 2002 BEFORE ME PERSONALLY CAME Joseph Maltese TO ME
KNOWN AND KNOWN TO ME TO BE THE (left blank) OF THE DEPARTMENT OF INFORMATION
TECHNOLOGY AND TELECOMMUNICATIONS OF THE CITY OF NEW YORK, THE PERSON DESCRIBED
AS SUCH IN AND WHO AS SUCH EXECUTED THE FOREGOING AGREEMENT AS ACCO FOR THE
PURPOSES THEREIN MENTIONED.

/S/ Aron Zakai
--------------
NOTARY PUBLIC OR COMMISSIONER OF DEEDS

      ====================================================================

                          ACKNOWLEDGMENT BY CORPORATION

STATE OF      KY     )
                                    )  SS.:
COUNTY OF FRANKLIN   )

ON THE 22nd DAY OF October, 2002 BEFORE ME PERSONALLY CAME J. Gary Reed WHO
BEING DULY SWORN, DID DEPOSE AND SAY THAT (S)HE RESIDES IN THE CITY OF
Lexington, STATE OF Kentucky, THAT (S)HE IS THE Sr. Vice Pres./COO OF
PlanGraphics, Inc., THE CORPORATION DESCRIBED IN AND WHICH EXECUTED THE
FOREGOING AGREEMENT; THAT (S)HE KNOWS THE SEAL OF SAID CORPORATION; THAT THE
SEAL AFFIXED TO THE SAID INSTRUMENT IS SUCH CORPORATE SEAL; THAT IT WAS SO
AFFIXED BY ORDER OF THE BOARD OF DIRECTORS OF SAID CORPORATION; AND THAT (S)HE
SIGNED HIS NAME THERETO BY LIKE ORDER.

/S/ Gary W. Murphy
------------------
NOTARY PUBLIC OR COMMISSIONER OF DEEDS

                                       22
<PAGE>

                           Plangraphics, Incorporated
                         Contract Number CTC20030009095

                                LETTER AGREEMENT

The purpose of the letter agreement is to clarify Article II, Term of Agreement,
for the above-specified Contract.

The initial Article II. TERM OF AGREEMENT currently reads as follows:

The term of this Agreement shall commence upon notice to proceed following
registration by the Comptroller and conclude three (3) years thereafter, with
the option to extend for two (2) additional one (1) year periods at the City's
sole discretion.

This article shall be clarified to read:

The term of this Agreement shall commence upon notice to proceed following
registration by the Comptroller and conclude three (3) years thereafter, with
the option to RENEW for two (2) additional one (1) year periods at the City's
sole discretion. The renewals may not be permissible if the State's contract
with Plangraphics lapses.

IN WITNESS, the parties hereto have executed this Letter Agreement on the date
first written below:

                                          THE CITY OF NEW YORK
                                          Department of Information Technology
                                          and Telecommunications

                                          By: /S/ (Illegible)
                                          -------------------

                                          Title: ACCO
                                          -----------

                                          Date: 11/illegible/02
                                          ---------------------

Plangraphics, Inc.

By: John C. Antenucci
---------------------

Title: President & CEO
----------------------

Date: Nov 25, 2002
------------------

EIN: 61-095 4403
----------------

                                       23Exhibit 10.1

                               RESEARCH AGREEMENT

                                     BETWEEN

                           PROFILE TECHNOLOGIES, INC.

                                       AND

                           PHILLIPS PETROLEUM COMPANY

<PAGE>

                               RESEARCH AGREEMENT

This Research Agreement, effective January 6, 2003, ("Effective Date"), is
between Profile Technologies, Inc., a Delaware Corporation ("PTI"), and Phillips
Petroleum Company, a Delaware corporation ("PHILLIPS"). In consideration of the
mutual covenants set forth in this Agreement, PTI and PHILLIPS agree as follows:

                             ARTICLE 1 - DEFINITIONS

1.1    "Agreement" means this Research Agreement, as may be amended from time to
       time according to Article 20, and any Schedules to this Agreement.

1.2    "Claim(s)" means any legal or equitable causes of action (including but
       not limited to negligence; strict liability; other tort; express or
       implied warranty, indemnity or contract; contribution; or subrogation)
       related to or arising out of the performance or nonperformance of this
       Agreement.

1.3    "Confidentiality Agreement" means the Confidentiality and Non-Disclosure
       Agreement dated as of March 5, 2001, by and between Phillips and PTI.

1.4    "Effective Date" means the date stated above.

1.5    "Force Majeure Event" means any event beyond the reasonable control of
       the party affected which significantly interferes with the party's
       performance hereunder. Force Majeure Events include any accident,
       mechanical breakdown of facilities, fire, flood, strike, labor trouble,
       riot, revolt, war, drought, action of governmental authority and laws,
       rules, ordinances and regulations (including, but not limited to, those
       dealing with pollution, health, ecology, or environmental matters), acts
       of God, a credible claim by a third-party that activity pursuant to this
       Agreement violates intellectual property rights of the third-party, or
       other similar types of contingencies.

1.6    "Month(s)" means a calendar month commencing on the first day of a month.

1.7    "PHILLIPS Background Technology" means technical information in PHILLIPS'
       possession, or which was conceived by an employee, agent or
       representative of PHILLIPS, before the effective date and is related to
       the Technical Area.

1.8    "Proprietary Information" shall have the meaning set forth in the
       Confidentiality Agreement.

1.9    "PTI Background Technology" means technical information in PTI's
       possession, or which was conceived by an employee, agent or
       representative of PTI before the effective date and is related to the
       Technical Area.

1.10   "Representative" means a parties' representative who shall be such
       parties' main contact for the research and development under this
       Agreement. Phillips' Representative shall be Randall Heald, (168 PL,
       Phillips Research Center, Bartlesville, Oklahoma 74004, Telephone:
       918/661-3156) or such other representative as it may designate from time
       to time. PTI's Representative shall be Scott Meaker, 2450 H. Street Road,
       Baine, WA 98230, Phone:360/366-3289,Facsimile:360/366-3294, or such other
       representative as it may designate from time to time.

<PAGE>

1.11   "Research Technology" means technical information which is generated
       during the parties' efforts under this Agreement.

1.12   "Technical Area" means electromagnetic methods and devices useful in
       detecting, evaluating and interpreting pipe, vessel, structure and
       equipment corrosion.

                               ARTICLE 2 - PURPOSE

2.1    The Parties agree to use reasonable efforts to improve the data
       interpretation methods currently being used to evaluate pipe corrosion
       data and/or develop new data interpretation methods. The goal of this
       project is to evaluate the use of pattern recognition tools available in
       chemometric software for improved analysis of PTI's corrosion data. Two
       key objectives are a) to use pattern recognition to improve the
       quantification of damage by this technique and b) improve the ability to
       distinguish corrosion from non-corrosion anomalies in the data sets. Both
       parties acknowledge that, as a result of this collaborative effort,
       additional research opportunities may arise that could improve PTI's
       proprietary EMW (Electro Magnetic Wave) testing services. The parties
       agree to make reasonable efforts to pursue said opportunities, as
       resources allow, if the anticipated results offer significant improvement
       in the services currently offered by PTI to Phillips.

2.2    PTI's primary responsibilities are:

       1. Provide raw data sets for the project (in a format that can be
       imported into pattern recognition software (e.g., ASCII format)).

       2. Provide a complete description of the testing and data processing
       procedures used to obtain the raw data sets.

       3. Provide specifications and corrosion information on the pipes tested
       to produce the raw data sets.

       4. Assist in evaluation of performance of new interpretation tools
       developed in this project.

2.3    PHILLIPS' primary responsibilities are:

       1. Provide pattern recognition tools (software).

       2. Provide functional understanding of pattern recognition tools.

<PAGE>

       3. Apply pattern recognition algorithms to raw data and attempt to
       identify location of corrosion from this approach.

       4. Assist in evaluation of performance of new interpretation tools
       developed in this project.

                                ARTICLE 3 - TERM

This Agreement shall terminate one year from the Effective Date unless extended
by the parties or terminated early in accordance with the terms of Article 9
below. The parties agree to attempt to meet the preliminary schedule attached
hereto as Exhibit A. The parties may alter the preliminary schedule by mutual
agreement of the Representative and will mutually agree to a forward plan for
additional research and development, if any, at the end of the preliminary
schedule.

                        ARTICLE 4 - INFORMATION EXCHANGE

The parties recognize that detailed and continuing exchanges of information may
be necessary in order to optimize the administration of this Agreement and to
perform the research provided hereunder. To that end, each party shall notify
the other of the individual representative or representatives responsible for
exchanging information and for resolving issues which arise affecting the
research. The designated representatives of PHILLIPS and PTI shall conduct
planning meetings as mutually agreed in order to address issues which shall
arise under this Agreement. The meetings need not take any particular form and
may include in person meetings (as mutually agreed upon), video conferences or
any combination thereof. The parties also agree to write a memorandum outlining
such targets, and other points of mutual agreement prior to concluding each of
said periodic meetings.

                                ARTICLE 5 - COSTS

5.1    Each party will be responsible for its own cost incurred in the
       performance under this Agreement without reimbursement from the other
       party. The Representatives of the parties will mutually agree in advance
       on the division of any cost determined to be joint cost.

                             ARTICLE 6 - WARRANTIES

6.1    Neither party makes any representations, extends any warranties of any
       kind (including freedom from alleged infringement of third party patents
       or trade secrets), either express or implied, and assumes no
       responsibility whatsoever with respect to the practice by the other
       party, its assignees or licensees of any Background Technology or
       Research Technology and each party agrees to indemnify and to hold the
       other party harmless from and assume all risk, liability, or lawsuits
       arising out of, or in the course of practice by such indemnifying party,
       its assignees or licensees of the Background Technology or Research
       Technology.

6.2    Each party hereto shall indemnify and hold harmless the other party and
       its officers, employees, agents, consultants, and subcontractors from and
       against any and all claims, demands, actions, liabilities, judgements,
       costs and expenses of whatever kind including, without limitations,
       attorney's fees and costs of defense, on account of damage to property of
       the indemnifying party or damage to personal property of or injury to our
       death of any officer, employee, agent, consultant or subcontractor of the
       indemnifying party arising out of, or related in any way to, this
       Agreement except to the extent that such damage, injury or death was
       caused by the sole negligence or wrongful act of the party indemnified or
       of its officers, employees, agents, consultants or subcontractors.

<PAGE>

                        ARTICLE 7 - INTELLECTUAL PROPERTY

7.1    PTI Proprietary Information and PTI Background Technology are owned by
       PTI.

7.2    PHILLIPS Proprietary Information and PHILLIPS Background Technology are
       owned by PHILLIPS.

7.3    PTI shall have first option to obtain any patent covering Research
       Technology. If PTI so elects, then all expenses related to obtaining and
       maintaining such patents shall be born solely by PTI and PTI will be sole
       owner of any such patents. PTI will notify PHILLIPS of its decision to
       obtain patent protection for any Research Technology within thirty (30)
       days from making its decision. Notwithstanding the foregoing, if PHILLIPS
       desires for patent protection to be obtained on an invention included in
       the Research Technology, it will notify PTI of such and PTI shall have
       sixty (60) days to evaluate whether it will file any patent applications
       relating to such invention and to notify PHILLIPS of its decision. For
       any patent applications filed by PTI under this Paragraph 7.3, PTI and
       PHILLIPS will consult on countries in which to file counterpart
       applications. If PHILLIPS desires to file such counterpart applications
       in countries other than those PTI desires to file counterpart
       applications, PHILLIPS will have the right to file and maintain such
       counterpart applications in PTI's name. In exchange for the first option
       to obtain and maintain patent(s), if any, covering Research Technology,
       PTI agrees to provide testing services to PHILLIPS at the lowest service
       price provided to any of PTI's customers This price protection excludes
       pipe testing demonstrations provided by PTI to potential customers or
       organizations free of charge or at cost.

7.4    If PTI elects not to attempt to obtain any patent coverage for an
       invention included in the Research Technology, then PHILLIPS shall have
       the option to obtain such patent. If PHILLIPS so elects, then all
       expenses shall be born solely by PHILLIPS and PHILLIPS will be sole owner
       of any such patents. PHILLIPS hereby grants to PTI a non-exclusive,
       perpetual, royalty-free license, with the right to grant sublicenses,
       under any such patents to make, use and sell any inventions covered by
       such patents.

7.5    Each party agrees to assist the other party in obtaining and protecting
       patents covering Research Technology including having its employees sign
       patent applications and assignment papers and otherwise cooperate in
       actions necessary for the prosecution and defense of patents resulting
       therefrom in all countries designated by such other party.

7.6    All non-patented Research Technology shall be owned by PTI and licensed
       to Phillips pursuant to Section 7.9.

7.7    PHILLIPS grants to PTI a non-exclusive, non-transferable, perpetual,
       royalty-free license to use PHILLIPS Background Technology for the
       purpose of performing PTI's obligations under this Agreement and as
       necessary for PTI to use the Research Technology.

<PAGE>

7.8    PTI grants to PHILLIPS a non-exclusive, perpetual, royalty-free license
       to use PTI Background Technology for the purpose of performing PHILLIPS'
       obligations under this Agreement and as necessary for PHILLIPS to use the
       Research Technology in accordance with the licenses set forth in
       Paragraph 7.9.

7.9    (a) PTI grants to PHILLIPS and its subsidiaries a non-exclusive,
       perpetual, royalty-free license to make, use and sell any inventions
       covered by the patented Research Technology and/or the non-patented
       Research Technology within the Technology Area for the limited purpose of
       interpreting PHILLIPS' or its affiliates data sets whether provided by
       PTI or by a PTI affiliate or licensee.

       (b) PTI grants to PHILLIPS a non-exclusive, perpetual, royalty-free
       license with the right to grant sublicenses to make, use and sell any
       inventions covered by the patented Research Technology and/or the
       non-patented Research Technology outside the Technology Area. This
       license shall survive termination of this Research Agreement.

7.10   The licenses granted under this Article 7 shall not be assigned or
       transferred by a party without the prior written consent of the other
       party, except that such licenses may be assigned or transferred by a
       party to its successor of its entire business to which this Agreement
       relates, or to a new business entity resulting from a merger, or to a
       person, firm or corporation acquiring all or substantially all of the
       business and assets of a party to which this Agreement relates.

                            ARTICLE 8 - FORCE MAJEURE

8.1    If the performance of the party impacted by a Force Majeure Event under
       this Agreement is delayed, such delay shall be without liability to such
       delayed party, for the duration of a Force Majeure Event.

8.2    The party whose performance is affected by a Force Majeure Event shall
       give prompt notice to the other party stating the details and expected
       duration of the vent. Once notice is given of a Force Majeure Event, the
       parties shall keep each other apprised of the situation until the Force
       Majeure Event terminates or this Agreement is terminated, whichever
       occurs first. Each party has full management discretion in dealing with
       its own labor issues, and in determining how and when to perform
       obligations (other than payment for work already performed) under this
       Agreement when the other party is involved in a strike, work stoppage or
       slowdown conditions.

<PAGE>

                          ARTICLE 9 - EARLY TERMINATION

Either party is entitled (without prejudice to its other rights and remedies
under this Agreement) to terminate this Agreement upon (a) written notice at any
time upon thirty (30) days notice to the other party (b) written notice by the
party not affected by a Force Majeure Event to the party affected by the Force
Majeure Event if a Force Majeure Event lasts for more than thirty (30) days.

                             ARTICLE 10 - ASSIGNMENT

This Agreement is not transferable or assignable by either party, except that it
may be assigned by a party to a successor of its entire business to which this
Agreement relates or to a new business entity resulting from a merger, or to a
person, firm, or corporation acquiring all or substantially all of the relevant
business and assets of a party to which this Agreement relates.

                               ARTICLE 11 - NOTICE

Any notice to be given under this Agreement shall be in writing and shall be
deemed given when received and may be sent by mail, express courier or facsimile
to:

       If to PHILLIPS:                              If the PTI:

       Phillips Petroleum Company                   Profile Technologies, Inc.
       132 PL, Phillips Research Center             2 Park Avenue, Suite 201
       Bartlesville, Oklahoma 74004                 Manhasset, NY 11030
       Attn: Mr. Randall Heald                      Attn: Mr. Henry Gemino
         918/662-2888     (FAX)                     516/365-6491 (FAX)

       With a copy to:                              With a copy to:

       Phillips Petroleum Company                   Profile Technologies, Inc.
       214 PLB, Phillips Research Center            2450 H, Street Road
       Bartlesville, Oklahoma 74004                 Blaine, WA  98230
       Attn: Ryan N. Cross                          Attn: Mr. Scott Meaker
       918/661-8739(FAX)                            360/366-3294 (FAX)

Either party may change its location or facsimile number to receive notices upon
ten (10) days prior written notice.

                   ARTICLE 12 - CONFIDENTIALITY OF INFORMATION

12.1   The parties agree that the terms of the Confidentiality Agreement are
       hereby incorporated into this Agreement by reference. Notwithstanding any
       provision therein or herein to the contrary, the parties' confidentiality
       obligations shall survive the termination of this Agreement and the
       stated term of the Confidentiality Agreement and shall remain in full
       force and effect as long as either party hereto uses or retains access to
       (including, without limitation, by virtue of one or more licenses granted
       hereunder) the Proprietary Information of the other party or any Research
       Technology.

<PAGE>

12.2   Each party may disclose the other party's Proprietary Information to
       subcontractors as long as such subcontractors agree in writing to be
       bound by obligations of confidence no less stringent than those contained
       herein. . Further, Phillips will not use PTI's Proprietary Information or
       any Research Technology to compete directly with PTI in its use of
       electromagnetic waves to detect and assess corrosion in or on pipelines,
       vessels and other structures and equipment and will likewise obligate all
       agents, assignees, sub-contractors and licencees to observe this
       prohibition; provided, however, that nothing herein shall be construed as
       preventing Phillips from applying its Proprietary Information and
       Research Technology to other inspection technologies that do not use
       electromagnetic waves..

                  ARTICLE 13 - EXPORT CONTROL OF TECHNICAL DATA

The parties acknowledge their obligations to adhere to the United States export
laws and regulations, such as Export Administration Regulations, International
Traffic in Arms Regulations and regulations promulgated by the Office of Foreign
Assets Control and the parties agree to adhere to such laws and regulations. No
law of conflicts or choice of law shall supersede this provision.

                       ARTICLE 14 - INDEPENDENT CONTRACTOR

It is the parties intent that they be independent contractors, with all the
attendant rights and liabilities, and not an agent or employee of the other
party. Any provision in this Agreement, or any action by a party, which may
appear to give such party the right to direct or control the other party in
performing under this Agreement means such other party shall use reasonable
efforts to follow the desires of the first party in results only.

                            ARTICLE 15 - SEVERABILITY

If any provision of this Agreement or the application thereof to any person or
circumstance shall, for any reason, and to the extent, be held to be invalid or
unenforceable under applicable law, such provision shall be deemed limited or
modified to the extent necessary to make the same valid and enforceable under
applicable law. Any invalid or unenforceable provision shall be replaced with
such new provision which shall allow the parties to achieve the intended
economic result in a legally valid and effective manner.

                       ARTICLE 16 - NON-WAIVER OF DEFAULTS

Any failure by either party at any time to enforce or require strict keeping and
performance of any of the terms and conditions of this Agreement shall not
constitute a waiver of such terms and conditions and shall not affect or impair
such terms or conditions in any way, or the right of either party at any time to
avail itself of such remedies as it may have for any breach or breaches of such
terms and conditions.

<PAGE>

                ARTICLE 17 - GOVERNING LAW AND DISPUTE RESOLUTION

17.1   The interpretation, validity and performance of this Agreement shall be
       governed by Delaware law, without regard to Delaware's conflict-of-law
       provisions, both as to interpretation and performance.

17.2   PTI and PHILLIPS shall attempt to resolve amicably any disputes that
       arise concerning the interpretation or operation of this Agreement
       according to the following principals.

       (a)    A representative of each party shall meet in an attempt to resolve
              any dispute.

       (b)    If the dispute is not resolved, then the commercial development
              manager of PTI responsible for the PHILLIPS relationship shall
              meet with the commercial manager for PHILLIPS responsible for the
              PTI relationship under this Agreement in an attempt to resolve any
              dispute. The persons nominated shall have 30 days to resolve the
              dispute.

       (c)    If the dispute is not resolved, then the PTI business director
              shall meet with the PHILLIPS business director responsible in an
              attempt to resolve any dispute. The person nominated shall have 30
              days to resolve the dispute.

17.3   Any dispute between PTI and PHILLIPS concerning the scope or
       interpretation of this Agreement that is not resolved pursuant to section
       17.2, including any dispute regarding the applicability of enforceability
       of this section 17.3, shall be submitted to binding arbitration according
       to the rules of Commercial Arbitration of the American Arbitration
       Association in effect on the date that a dispute is submitted to
       arbitration (the `Rules') except as the Rules are modified by this
       Agreement. Arbitration shall be in English before a panel of three
       arbitrators: one arbitrator will be selected by each party; the third
       arbitrator shall be selected by the arbitrators selected by the parties.

17.4   Not less than 60 days prior to the arbitration hearing, PTI and PHILLIPS
       shall submit to the other party the documents and a list of witnesses it
       intends to use in the arbitration. The arbitrators shall issue a written
       opinion stating the findings of fact and the conclusions of law upon
       which the decision is based. The decision of the arbitrators shall be
       final and binding, absent manifest error in the findings of fact or the
       conclusions of law. The decision of the arbitrators may be enforced in
       any court or competent jurisdiction. The arbitrators shall be instructed
       that the arbitration award shall not include punitive, special or
       consequential damages. Each party shall bear equally the administrative
       costs of the arbitration. Each party shall bear its own costs for
       preparation and presentation of the dispute to the arbitrators.

                              ARTICLE 18 - HEADINGS

The headings used in this Agreement are for the convenience of the reader and
are not intended to have any substantive meaning.

<PAGE>

                          ARTICLE 19 - ENTIRE AGREEMENT

This Agreement constitutes the full understanding of the parties, and is a
final, complete and exclusive statement of the terms and conditions of their
agreement regarding the subject of this Agreement. All representations, offers,
and undertakings, of the parties made prior to the effective date of this
Agreement are merged in this Agreement. All amendments or modifications to this
Agreement must be in writing, identified as an Amendment to this Agreement and
signed by an authorized representative of each party.

                             ARTICLE 20 - GRATUITIES

PTI will not itself, nor will PTI encourage or facilitate others, to pay any
commissions, fees, or grant any rebates to; favor with gifts or entertainment of
significant cost or value to; nor enter into any business arrangement with;
persons known to be employees, officers, or agents of PHILLIPS without the prior
written consent of PHILLIPS.

                              ARTICLE 21 - RECORDS

Both parties agree to keep true and correct records pertaining to this contract
and all transactions related thereto and to maintain such records for a period
of at least two (2) years after termination of this contract. On written request
by either party and at such party's expense, each party may have a firm of
independent certified public accountants audit any and all such records of the
other party at any time or from time to time for the purpose of confirming the
accuracy of such records and the manner in which such records have been used in
the administration of this contract; provided however, that such accountants
shall not disclose to the party requesting the audit any information obtained
during such audit and shall only report to such party the results of the audit
and whether same shows compliance with the terms of this contract, or as the
case may be, the respects in detail in which the terms of this contract have not
been complied with. The right to audit such records shall expire two (2) years
after termination of this contract.

                              ARTICLE 22 - SURVIVAL

The rights, obligations, and terms set forth in Articles 7, 12, and 13 shall
survive the termination or expiration of this Agreement.

The parties have caused this Agreement to be executed by their duly authorized
representatives. This Agreement shall be void if it is not executed by all
parties within thirty (30) days of the date on which the first party executes
this Agreement.

PHILLIPS PETROLEUM COMPANY                   PROFILE TECHNOLOGIES, INC.

By /S/ Jan R. Knud                           By Henry E. Gemino
-----------------------------                -----------------------------------
Title: Vice President, Upstream Technology   Title: Chief Executive Officer
Date: December 3, 2002                       Date: January 6, 2003

<PAGE>

                                    EXHIBIT A
                                    ---------

Preliminary Schedule

1.   Phillips and PTI schedule an extended session for detailed discussion and
     planning of project. Within two (2) weeks of the Agreement Date.

2.   PTI provides initial data set for screening existing pattern recognition
     tools.

3.   Phillips processes initial data set with existing tools. Within four (4)
     weeks of step 2.

4.   PTI and Phillips meet to review first set of results and develop a forward
     plan. Within 3 weeks of step 3.

5.   Agreement on forward plan after completion of Paragraph 4.

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