SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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


                                    FORM 8-K

                                 CURRENT REPORT
                       PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

       Date of Report (Date of earliest event reported) December 10, 2001



                              SAVE ON ENERGY, INC.
             (Exact Name of Registrant as Specified in its Charter)



             Georgia                     333-33134            58-2267238
  (State or Other Jurisdiction          (Commission        (I.R.S. Employer
        of Incorporation)                 File No.)       Identification No.)


                       4851 Georgia Highway 85, Suite 211,
                           Forest Park, Georgia 30050
          (Address, including zip code, of principal executive offices)


       Registrant's telephone number, including area code: (404) 765-0131

                                    No Change
          (Former Name or Former Address, if Changed Since Last Report)









<PAGE>


ITEM 2.  ACQUISITION OR DISPOSITION OF ASSETS

On December 11, 2001, Save On Energy, Inc. (the "Company"), through its
wholly-owned subsidiary, Alternative Energy Technologies, Inc. ("AET"),
completed the acquisition of certain assets of New York State Electric & Gas
Corporation ("NYSEG"). The acquisition included substantially all of NYSEG's
assets relating to its natural gas vehicle service, maintenance and construction
business. Simultaneously with the closing of the acquisition, the Company
entered into a Service Agreement with NYSEG pursuant to which, among other
things, the Company has agreed to maintain NYSEG's natural gas refueling
facilities for a period of four years. Robert Stiles, the Company's President,
formerly served as the Manager of NYSEG's Alternative Fuel Vehicle Market
Development division. The new company will continue to provide customers with
heavy duty vehicle natural gas conversion equipment, facility and equipment
maintenance, training, consulting, and infrastructure design construction
services.

The aggregate purchase price for these assets was approximately $300,000, of
which, $70,000 in cash was paid at the closing with the balance payable in
quarterly installments through March 31, 2003. AET's obligation to make such
payments is secured by a first priority lien in favor of NYSEG on all of AET's
assets and is guaranteed by the Company.

The foregoing description of the transaction is qualified in its entirety by
reference to the Asset Purchase Agreement and related documents, which are filed
herewith as exhibits.

ITEM 5.     OTHER EVENTS

Private Placement of Securities

On December 10, 2001, the Company completed its private placement of 2.6 million
shares of common stock to SWI Holdings, Limited ("SWI"), a Bermuda company, for
an aggregate purchase price of $500,000. To date, SWI has paid $300,000 of the
purchase price with the balance due on or before January 15, 2002. Pursuant to
the Company's Stock Purchase Agreement with SWI, SWI has the right during the
period between December 31, 2003 and June 30, 2004 to require the Company to
purchase up to 2.5 million of these shares at a price of $0.20 per share (the
"Put Option"). The Put Option will automatically terminate in the event that the
Company (i) completes a financing of in excess of in excess of $2.0 million in
gross proceeds at an offering price per share of not less than $0.40 or (ii)
completes a merger or other business combination pursuant to which the common
stock is valued at a price per share of not less than $0.40. The Company's
obligations under the Put Right are secured by a lien in favor of SWI on all of
the Company's assets.

In connection with the private placement, the Company issued a three-year
warrant to SWI. The warrant provides SWI the right to acquire up to 250,000
shares of the Company's common stock at an exercise price of $0.50 per share.

The Company has also agreed to use its reasonable best efforts to file a
registration statement covering the resale of the shares issued in the private
placement on or before January 31, 2002.

The foregoing description of the transaction is qualified in its entirety by
reference to the Stock Purchase Agreement and Security Agreement, which are
filed herewith as exhibits.


Appointment of Board Members

On December 12, 2001, the Board of Directors appointed Wolfgang Wacker and Greg
Erwin to fill two vacancies on the Board. Messrs. Wacker and Erwin were elected
to serve on the Board at the Company's previous annual meeting, however, they
declined to accept such appointment until the Company obtained Directors and
Officers Insurance coverage. Mr. Wacker is also a shareholder and a Vice
President of SWI. Information regarding the business backgrounds of each of
Messrs. Wacker and Erwin can be found in the Company's Proxy Statement relating
to its 2001 Annual Meeting, which was filed with the SEC on October 1, 2001.

ITEM 7.  FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS

         (a) Financial Statements.

             It is impracticable to provide the required financial statements
for the acquired business at the time of this Report. Pursuant to Item 7(a)(4),
the registrant will file the required financial statements as soon as
practicable but not later than 60 days after the date of this Report.

         (b) Pro Forma Financial Information.

             It is impracticable to provide the required pro forma financial
information at the time of this Report. Pursuant to Item 7(b)(2), the registrant
will file the required pro forma financial information as soon as practicable
but not later than 60 days after the date of this Report.

         (c) Exhibits.

2.1 Asset Purchase  Agreement  between the Company and New York State Electric &
Gas Corporation, dated as of October 29, 2001.

2.2  Secured  Promissory  Note  in  favor  of  New  York  State  Electric  & Gas
Corporation, dated as of December 11, 2001.

2.3  Security  Agreement  between the Company and New York State  Electric & Gas
Corporation, dated as of December 11, 2001.

2.4  Guaranty  from  the  Company  in favor of New  York  State  Electric  & Gas
Corporation, dated as of December 11, 2001.

10.1 Stock  Purchase  Agreement  between the Company and SWI Holdings,  Limited,
dated as of December 10, 2001 (Composite Version).

10.2 Security Agreement between the Company and SWI Holdings,  Limited, dated as
of December 10, 2001




<PAGE>




                                    SIGNATURE


  Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.


Date:  December 13, 2001

                                                SAVE ON ENERGY, INC.


                                                By:  /s/ Robert Stiles
                                                     -----------------
                                                  Name:  Robert Stiles
                                                  Title: President





<PAGE>





                                   EXHIBIT 2.1
                            ASSET PURCHASE AGREEMENT


         THIS ASSET PURCHASE AGREEMENT ("Agreement") is made as of this 29th
date of October, 2001 between NEW YORK STATE ELECTRIC & GAS CORPORATION, a New
York transportation corporation, having an address at Corporate Drive-Kirkwood
Industrial Park, PO Box 5224, Binghamton, New York 13902-5224 ("Purchaser") and
ALTERNATIVE ENERGY TECHNOLOGIES, INC., a New York corporation, having an office
at Airport Industrial Center, Suite 210, 4851 Georgia Highway 85, Forest Park,
Georgia 30297 ("Purchaser").

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency is hereby acknowledged, and in consideration of the recitals and the
respective covenants, representations, warranties and agreements herein
contained, and intending to be legally bound hereby, the parties hereto hereby
agree as follows:
         1.  Transfer of Assets.
                  1.1 Assets Conveyed. Upon the terms and subject to the
conditions set forth in this Agreement, Purchaser will purchase from Seller, and
Seller will sell, assign, transfer, convey and deliver to Purchaser at the
Closing ("Closing") on the Closing Date, as hereinafter defined, free and clear
of any and all claims, liens, pledges, options, security interests, conditional
sales agreements and encumbrances, whether voluntarily incurred or arising by
operation of law, all of Seller's right, title and interest in and to the
following assets of that natural gas vehicle sales and service business
("Business") currently operated by Seller at the NYSEG NGV Tech Center located
at 432 East Main Street, Endicott, New York 13760 (the "Premises"): (i) the
furniture and office supplies located on the Premises and certain computer
equipment listed on Exhibit D, attached hereto and made a part hereof, and
software owned by Seller and located on the Premises and in the home office of
Brenda Yuhas, an independent contractor of the Business who currently resides in
420 Bloombridge Way, Marietta, Georgia 30066 (collectively, "Office Equipment
and Supplies"); (ii) the equipment listed on Exhibit E, attached hereto and made
a part hereof (collectively, the "Equipment"); (iii) the two motor vehicles
described on Exhibit F, attached hereto and made a part hereof ("Motor
Vehicles"); (iv) the inventory and tanks substantially as listed on Exhibit G
located on the Premises or the Motor Vehicles as of the time of Closing
("Inventory"); (v) revenue and accounts receivable for service rendered and
goods shipped after 12:01 p.m. on the Closing Date; (vi) the "Pressure Plus"
trademark and the two logos in the form set forth on Exhibit H, attached hereto
and made a part hereof ("Business Identifiers"); (vii) any and all rights of
NYSEG in and to mobile natural gas compressor and home compressor technology as
described in Exhibit I ("Technology"); and (viii) any and all customer lists
relating to the Business (all of the foregoing described assets collectively
referred to hereinafter as the "Assets").
                  1.2 Exclusions. Those assets of the Business not expressly and
specifically described in Section 1.1 are excluded from the purchase and sale
effected by this Agreement, such excluded assets to include, without limitation,
the cash on hand; bank, savings or other accounts and items therein; the lease
of the Premises and all contracts associated with the Business (which shall be
terminated before the Closing); securities or instruments; insurance policies of
Seller and any rights or claims thereunder; revenue and accounts receivable for
goods shipped and services rendered before 12:01 p.m. on the Closing Date;
Seller's goodwill and any trade names, marks, logos or other commercial symbols
associated with Seller (not specifically included as Business Identifiers); and
any and all of Seller's books and records, provided however, that with Seller's
prior written approval, Purchaser may examine those books and records of Seller
that pertain to the operation of the Business to the extent necessary to conduct
a legitimate due diligence hereunder.
                  1.3 Assumed Liabilities. Notwithstanding anything to the
contrary contained herein, the Purchaser will not assume or have any
responsibility with respect to any obligation or of any kind or nature of the
Seller, fixed or unfixed, choate or inchoate, liquidated or unliquidated,
secured or unsecured, known or unknown, accrued, absolute, contingent or
otherwise.
         2.  Purchase Price.
                  2.1  Total  Purchase  Price.  The  total  "Purchase  Price"
shall  be the  sum  of  two  hundred eighty-five thousand dollars ($285,000.00).
                  2.2 Payment of Purchase Price. The total Purchase Price shall
be paid by wire transfer of funds to the account of Seller at Closing in
accordance with the written instructions provided to Purchaser by Seller within
two business days prior to Closing.
                  2.3 Allocation of Purchase Price. The Purchase Price shall be
allocated among the Assets acquired hereunder in accordance with Exhibit J
attached hereto. Seller and Purchaser each hereby covenants and agrees that it
will not take a position on any income tax return, before any governmental
agency charged with the collection of any income tax, or in any judicial
proceeding that is in any way inconsistent with the terms of this Section 2.4
and the allocation of the Purchase Price as determined by the Seller's Board of
Directors.
         3.  Prorations.  The  following  items  relating  to the  Assets  and
Business  shall be paid  through or prorated as of, the Closing Date:  None
         4. Utilities. The parties shall arrange for a transfer of all utility
services to the Premises from the Seller to the Purchaser as of the Closing
Date. In the event any of the utilities can not be transferred as of the Closing
Date, such utilities shall be prorated and calculated through the Closing Date
and, (i) amounts prepaid by Seller for post-Closing services will be remitted by
Purchaser to Seller upon request; or (ii) any amounts remaining to be paid at
Closing for pre-Closing services will be remitted by Seller to Purchaser upon
request.
         5.  Instruments of Transfer and Warranties.
                  5.1 The sale, assignment and delivery of the Assets will be
effected by documents substantially in the form of the Bill of Sale attached
hereto as Exhibit A, standard New York State Department of Motor Vehicles
certificates of title, the Assignment of Trademark attached hereto as Exhibit B
and the Assignment of Rights to Technology attached hereto as Exhibit C
(together referred to as the "Instruments of Transfer"). EXCEPT AS EXPRESSLY
PROVIDED HEREIN, THE ASSETS WILL BE CONVEYED TO THE PURCHASER "AS IS, WHERE IS"
WITHOUT WARRANTIES OR REPRESENTATIONS. IT IS EXPRESSLY UNDERSTOOD AND AGREED
THAT SELLER SHALL IN NO WAY BE DEEMED OR HELD TO BE OBLIGATED, LIABLE, OR
ACCOUNTABLE UPON OR UNDER ANY GUARANTEES OR WARRANTIES, EXPRESSED OR IMPLIED,
INCLUDING THE WARRANTY OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE,
STATUTORY, BY OPERATION OF LAW, OR OTHERWISE, IN ANY MANNER OR FORM BEYOND ANY
EXPRESS WARRANTIES ENUMERATED HEREIN.
         On the Closing Date, Seller will deliver to Purchaser the Instruments
of Transfer, fully executed, and acknowledged where applicable, and
simultaneously with such delivery Seller will take all such steps as may be
necessary to put Purchaser in actual possession of the Assets, as and where
presently located.
         6. The Closing.  The closing of this Agreement (the "Closing")  shall
take place  __________,  2001 at the offices  of Seller at 10:00  a.m.  or at
such  other  time,  date and place as may be agreed on in  writing  by the
parties (the "Closing Date").
         7.  Representations  of Seller.  Seller  represents  and warrants to
Purchaser  that as of the date of its signing this Agreement and as of the
Closing Date:
                  7.1 Valid Corporate Existence; Qualification. Seller is a
transportation corporation duly organized, validly existing and in good standing
under the laws of the State of New York. Seller has the power to carry on its
business as now conducted. Seller is not required to qualify in any other
jurisdiction in order to own the Assets or to carry on the Business as now
conducted, and there has not been any claim by any other jurisdiction to the
effect that Seller is required to qualify or otherwise be authorized to conduct
the Business as a foreign corporation therein.
                  7.2 Consents. No consents are required to be received by or on
the part of Seller to enable it to enter into and carry out this Agreement and
the transactions contemplated hereby, including, without limitation, the
transfer to Purchaser of all of Seller's right, title and interest in and to the
Assets.
                  7.3 Authority; Binding Nature of Agreement. Seller has the
power to enter into this Agreement and to carry out its obligations hereunder.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by the appropriate
corporate action and no other proceedings, corporate or otherwise, on the part
of Seller are necessary to authorize the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby. This
Agreement constitutes the valid and binding obligation of Seller and is
enforceable in accordance with its terms.
                  7.4      No Breach.  Neither the  execution  and delivery of
this  Agreement  nor  compliance  by Seller with any of the provisions hereof
nor the consummation of the transactions contemplated hereby, will:
                           (a) violate or conflict  with any  provision  of the
Certificate  of  Incorporation  or By-Laws of Seller;
                           (b) violate or,  alone or with  notice or the
passage of time,  result in the  material breach or termination of, or otherwise
give any contracting party the right to terminate, or declare a default under,
the terms of any contract to which Seller is a party or by which it may be
bound;
                           (c) violate any judgment,  order, injunction,  decree
or award against, or binding upon, Seller or its properties or assets, the
violation of which would have a material adverse effect on Seller; or
                           (d) violate any law or regulation of any jurisdiction
relating to Seller or the Business, the violation of which would have a material
adverse effect on Seller.
                  7.5 Title. Seller has good and marketable title to all Assets,
except as hereinafter provided. SELLER MAKES NO REPRESENTATIONS OR WARRANTIES,
INCLUDING, WITHOUT LIMITATION, WARRANTIES OF TITLE, WITH RESPECT TO THE BUSINESS
IDENTIFIERS AND THE TECHNOLOGY.
                  7.6 Litigation; Compliance with Law. There are no actions,
suits, proceedings or governmental investigations relating to the Assets or the
Business pending or, to the knowledge of Seller, threatened, or any order,
injunction, award or decree outstanding, against or relating to any of its
Assets, the Business or the transactions contemplated hereby and there exists no
basis for any such action, suit, proceeding, governmental investigation, order,
injunction, award or decree which would have a material adverse effect on the
Assets, the Business or the transactions contemplated by this Agreement. Seller
is not in violation of any law, regulation, ordinance, order, injunction,
decree, award, or other requirement of any governmental or other regulatory
body, court or arbitrator relating to the Assets, the Business or the
transactions.
                  7.7      Environmental, Health, and Safety Matters.
                                    (i)     To the  knowledge  of Seller,  the
Business is in  compliance  with all Environmental, Health, and Safety
Requirements, as hereinafter defined.
                                    (ii)    To the  knowledge  of Seller,  the
Seller has not received any written notice, report or other information
regarding any actual or alleged material violation of Environmental, Health, and
Safety Requirements, or any material liabilities or potential material
liabilities (whether accrued, absolute, contingent, unliquidated or otherwise)
relating to the Business or the Assets, including any investigatory, remedial or
corrective obligations arising under Environmental, Health, and Safety
Requirements. For purposes hereof, the phrase "Environmental, Health, and Safety
Requirements" shall mean all federal, state, local and foreign statutes,
regulations, and ordinances concerning public health and safety, worker health
and safety, and pollution or protection of the environment, including without
limitation all those relating to the presence, use, production, generation,
handling, transportation, treatment, storage, disposal, distribution, labeling,
testing, processing, discharge, release, threatened release, control, or cleanup
of any hazardous materials, substances or wastes, as such requirements are
enacted and in effect on or prior to the Closing Date.
                  7.8 Customer Relationships. To the knowledge of the Seller,
there are no facts or circumstances, including the consummation of the
transactions contemplated by this Agreement, that are reasonably likely to
result in the loss of its customer or a material change in its relationship with
such customer. For the purposes of this Section 7.8, the phrase "to the
knowledge of the Seller" shall mean to the knowledge of Bruce D. Roloson, an
employee of Seller.
         8.        Representations   of  Purchaser.   The  Purchaser  makes  the
following   representations   and warranties  to Seller,  each of which is true
and  correct on the date  hereof and will be true and  correct on the Closing
Date.
                  8.1 Valid Corporate Existence; Qualification. Purchaser is a
corporation duly organized, validly existing and in good standing under the laws
of the State of New York. Purchaser has the power to carry on its business as
now conducted. Purchaser is not required to qualify in any other jurisdiction in
order to own the Assets or to carry on its business as now conducted, and there
has not been any claim by any other jurisdiction to the effect that Purchaser is
required to qualify or otherwise be authorized to do business as a foreign
corporation therein.
                  8.2 Consents. No consents are required to be received by or on
the part of Purchaser to enable it to enter into and carry out this Agreement
and the transactions contemplated hereby, including, without limitation, the
transfer to Purchaser of all of Seller's right, title and interest in and to the
Assets.
                  8.3 Authority; Binding Nature of Agreement. Purchaser has the
power to enter into this Agreement and to carry out its obligations hereunder.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by the Board of
Directors of the Purchaser and no other proceedings, corporate or otherwise, on
the part of Purchaser are necessary to authorize the execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby.
This Agreement constitutes the valid and binding obligation of Purchaser and is
enforceable in accordance with its terms.
                  8.4      No Breach.  Neither the  execution  and delivery of
this  Agreement  nor  compliance  by Purchaser with any of the provisions hereof
nor the consummation of the transactions contemplated hereby, will:
                           (a) violate or conflict  with any  provision  of the
Certificate  of  Incorporation  or By-Laws of Purchaser;
                           (b) violate or,  alone or with  notice or the
passage of time, result in the material breach or termination of, or otherwise
give any contracting party the right to terminate, or declare a Default under,
the terms of any Contract to which Purchaser is a party or by which it may be
bound;

                           (c) violate any judgment,  order, injunction,
decree or award against, or binding upon, Purchaser or its properties or assets,
the violation of which would have a material adverse effect on Purchaser; or


<PAGE>


                           (d) violate any law or  regulation  of any
jurisdiction  relating to  Purchaser  or its business, the violation of which
would have a material adverse effect on Purchaser.
                  8.5 Litigation; Compliance with Law. There are no actions,
suits, proceedings or governmental investigations relating to the Purchaser
pending or, to the knowledge of Purchaser, threatened, or any order, injunction,
award or decree outstanding, against or relating to the Purchaser that could
have a material effect upon the transactions contemplated hereby, and there
exists no basis for any such action, suit, proceeding, governmental
investigation, order, injunction, award or decree which could have a material
adverse effect on the transactions contemplated hereby. Purchaser is not in
violation of any law, regulation, ordinance, order, injunction, decree, award,
or other requirement of any governmental or other regulatory body, court or
arbitrator that could have a material effect upon the transactions contemplated
hereby.
         9.  Additional Covenants.
                  9.1 Accounts Receivable. Each party agrees that if after the
Closing Date it receives payment upon an account receivable that is allocable to
the other party under Article 1, it will remit such payment to the other party
within five days of receipt.
                  9.2 Access. Seller agrees that Purchaser may have reasonable
access solely to the Premises, but only to the extent necessary for Purchaser to
perform its due diligence prior to Closing and during such times as are
reasonably convenient for Seller's employees. Seller agrees that so long as any
books, records and files retained by Seller relating to the Business or Assets
remain in existence and are available, each party (at its expense) shall have
the right to inspect and to make copies of the same at any time during business
hours for any proper purpose. Nothing contained herein shall require that either
party disclose or give the other party access to financial records relating to
such party's ownership of the Assets or operation of the business being
transferred hereunder, except as specifically required by this Agreement.
Neither of the parties hereto will destroy any of such books, records and files
for a period of six years plus any extensions of time necessary due to any tax
return or inquiry, audit, investigation or dispute after the Closing, without
first having offered to deliver such books and records to the other party. Each
party agrees that it will cooperate with and make available to the other party
during normal business hours any books, records and information relating to the
period prior to the Closing and any employees necessary and useful in connection
with (i) any tax return or inquiry, audit, investigation or dispute, (ii) any
litigation against or investigation by a third party, or (iii) any other
business purpose requiring access to such books, records, information or
employees. The party requesting any such books, records, information or
employees shall bear all of the out-of-pocket costs and expenses (including
without limitation attorney's fees, but excluding reimbursement for salaries and
employee benefits) reasonably incurred in connection with providing such books,
records, information or employees.
                           (b)      Seller  shall  permit  Purchaser's
accountants to prepare audited financial statements of the Business to the
extent required for SEC filings of Purchaser or its affiliates. Seller and its
representatives shall reasonably cooperate, to the extent necessary, with
Purchaser's accountants in the preparation of such financial statements.
                  9.3 Confidentiality. The parties hereto agree to maintain the
confidentiality of all of the terms and conditions of this Agreement and the
transactions contemplated hereby and all information acquired or held by either
party in relation to the Business regardless of whether this Agreement closes.
If this Agreement fails to close for any reason, Purchaser shall return to
Seller, without retaining a copy thereof, any and all information including all
schedules, documents or other written information obtained from Seller in
connection with this Agreement and the transactions contemplated hereby.
         Following the Closing Date, Seller shall maintain the confidentiality
of all information relating to the Business prior to the Closing Date and shall
not use such information for any purpose other than as expressly authorized in
writing after the Closing Date by the Purchaser. Notwithstanding anything
hereinabove to the contrary, the obligations imposed upon the Seller herein
shall not apply to information:
                  (a)      which is publicly available prior to the date hereof;
or
                  (b)      which hereafter  becomes  available to the public
through no wrongful act of the Seller; or
                  (c)      which was or is received  from a third party  without
restriction,  not in violation of an agreement of confidence and without breach
of this Agreement; or
                  (d)      which is  disclosed  pursuant  to a  requirement  or
request  of a  government  agency, arbitrator or court.
                  9.4 Brokers. Each party represents to the other that it has
not utilized the services of any broker or other finder in connection with the
purchase and sale of the Assets and there are no fees, commissions or other
payments due to anyone for such services. Seller and Purchaser shall each
indemnify and hold the other harmless in accordance with the indemnification
provisions of Article 13 from and against all claims for a brokerage commission
arising out of a breach of their respective representation under this
Subsection.
                  9.5 Communications With Customers. Within seven (7) days after
the Closing, the parties will send a joint letter or, at Purchaser's option,
Purchaser may send its own independent letter, to each of Seller's customers of
the Business announcing the sale of the Business, identifying the Purchaser and
relating such other information as may be deemed appropriate. Seller and
Purchaser shall use their best efforts to terminate each Client Contract and
Seller shall cooperate with Purchaser in its efforts to cause such clients to
enter into an agreement with Purchaser on substantially similar terms and
conditions (the "Purchaser Client Contracts"). 9.6 Further Assurances. At or
after the Closing, Seller shall also execute and deliver, at Seller's expense,
such further instruments of conveyance, sale, assignment or transfer, and shall
take or cause to be taken such other or further action, as Purchaser shall
request at any time or from time to time in order to vest, confirm or evidence
in Purchaser title to all or any part of the Assets intended to be conveyed,
sold, transferred, assigned and delivered to Purchaser under and in accordance
with this Agreement.
                  9.7 Non-competition. For a period of eighteen (18) months from
and after the Closing Date, the Seller will not engage directly or indirectly in
the Business within the State of New York. If the final judgment of a court of
competent jurisdiction declares that any term or provision of this Section 9.7
is invalid or unenforceable, the parties agree that the court making the
determination of invalidity or unenforceability shall have the power to reduce
the scope, duration, or area of the term or provision, to delete specific words
or phrases, or to replace any invalid or unenforceable term or provision with a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision, and
this Agreement shall be enforceable as so modified after the expiration of the
time within which the judgment may be appealed.
         10. Bulk Sales. Seller and Purchaser waive compliance with the
provisions of Article VI of the Uniform Commercial Code relating to bulk sales
in connection with this Agreement, and Seller will indemnify Purchaser for any
loss or damage incurred by Purchaser due to the failure to comply with such bulk
sale provisions contained in such Article of Uniform Commercial Code, (all as
provided in Article 13 of this Agreement.) Nothing in this Section shall stop or
prevent Seller or Purchaser from asserting as a bar or defense to any action
brought under such bulk sales law that it is not applicable to the sale
contemplated by this Agreement.
         11.  Conditions  Precedent to the Seller's  Obligations.  All
obligations  of Seller under this Agreementare subject to the fulfillment, at
Seller's option, at or before the Closing, of each of the following conditions:
                  11.1 Representations and Warranties. All representations and
warranties of Purchaser contained in this Agreement and in any written
statement, exhibit, certificate, schedule or other document delivered pursuant
hereto or in connection with the transactions contemplated hereby shall be true
and correct as at the Closing Date, as if made at the Closing and as of the
Closing Date.
                  11.2 Covenants. Purchaser shall have performed and complied
with all covenants and agreements required by this Agreement to be performed or
complied with by it prior to or at the Closing.
                  11.3 Litigation Affecting Closing. On the Closing Date no
suit, action, or other proceeding shall be threatened or pending before any
court, arbitration body or governmental agency in which it is sought to
restrain, prohibit, or to obtain damages or other relief in connection with this
Agreement or the consummation of the transactions contemplated hereby.
                  11.4 Service Agreement. Purchaser shall have entered into a
Service Agreement, in the form of attached hereto as Exhibit K, to provide
warranty service to customers of the Business who purchased goods from Seller
prior to the Closing, to provide natural gas station maintenance services and to
provide such other services as may be specified therein.
         12.  Conditions  Precedent to Purchaser's  Obligations.  All
obligations of Purchaser under this Agreement are, at Purchaser's option,
subject to the fulfillment at or before the Closing of the following conditions:
                  12.1 Representations and Warranties. All representations and
warranties of Seller contained in this Agreement and in any written statement,
exhibit, certificate, schedule or other document delivered pursuant hereto or in
connection with the transactions contemplated hereby shall be true and correct
as at the Closing Date, as if made at the Closing and as of the Closing Date.
                  12.2 Covenants. Seller shall have performed and complied with
all covenants and agreements required by this Agreement to be performed or
complied with by it prior to or at the Closing.
                  12.3 Litigation Affecting Closing. On or before the Closing
Date no suit, action, or other proceeding shall be threatened or pending before
any court, arbitration body or governmental agency in which it is sought to
restrain, prohibit, or to obtain damages or other relief in connection with this
Agreement or the consummation of the transactions contemplated hereby.
                  12.4 Service Agreement. Seller shall have entered into a
Service Agreement, in the form of attached hereto as Exhibit K, whereby Seller
engages Purchaser to provide warranty service to customers of the Business who
purchased goods from Seller prior to the Closing, to provide natural gas station
maintenance services and to provide such other services as may be specified
therein.
                  12.5     Financial Due Diligence.  Purchaser  shall be
reasonably  satisfied  with the results of its financial due diligence.
         13.  Indemnification.
                  13.1     Indemnification  Obligations.  From and after the
date hereof,  Seller,  will reimburse, indemnify and hold harmless Purchaser in
against and in respect of:
                  (a) any and all damages, losses, deficiencies, liabilities,
costs and expenses incurred or suffered by Purchaser that result from, relate to
or arise out of:
                           (i) any and all actions,  claims,  suits,  demands,
litigation, governmental or other proceedings, labor disputes, arbitration
actions, governmental audits, inquiries, investigations, criminal prosecutions,
investigations of unfair labor practice charges or complaints (collectively,
"Actions") against the Purchaser that relate to the Business or the Assets in
which the principal event giving rise thereto occurred prior to the Closing
Date, or which result from or arise out of any action or inaction prior to the
Closing Date of Seller or any director, officer, employee, shareholder, agent or
representative of Seller; or
                           (ii) any  misrepresentation,  breach of warranty or
non-fulfillment of any agreement or covenant on the part of Seller under this
Agreement; and
                  (b) any and all Actions, assessments, audits, fines,
judgments, costs and other expenses (including, without limitation, reasonable
legal fees) of Purchaser incident to any of the foregoing or to the enforcement
of this Article 13.
                  13.2 General Indemnification Obligation of Purchaser.2.3
         General Indemnification Obligation of Purchaser.2.3 General
         Indemnification Obligation of Purchaser.2.3 General Indemnification
         Obligation of Purchaser. From and after the date hereof, Purchaser will
         reimburse, indemnify and hold harmless Seller and its successors or
         assigns against and in respect of:
                  (a) any and all damages, losses, deficiencies, liabilities,
costs and expenses incurred or suffered by Seller that result from, relate to or
arise out of:
                                    (i) any and all  Actions  against the Seller
that relate to the Assets in which the principal event giving rise thereto
occurred on or after the Closing Date or which result from or arise out of any
action or inaction prior to the Closing Date of Purchaser or any director,
officer, employee, shareholder, agent or representative of Purchaser; or
                                    (ii) any  misrepresentation,  breach  of
warranty  or  non-fulfillment  of any agreement or covenant on the part of
Purchaser under this Agreement; and
                      (b)  any and all Actions,  assessments,  audits, fines,
judgments,  costs and other expenses (including, without limitation, reasonable
legal fees) of Seller incident to any of the foregoing or to the enforcement of
this Article 13.
                  13.3 Method of Asserting  Claims,  Indemnitee.2.4  Method of
Asserting  Claims,  Etc.2.4  Method of Asserting Claims, Etc.2.4  Method of
Asserting Claims, Etc.
                  (a) In the event that any claim or demand for which a party
(the "Indemnitor") would be liable to indemnify another party hereunder (the
"Indemnitee")is asserted against or sought to be collected from the Indemnitee
by a third party, such Indemnitee shall notify Indemnitor of such claim or
demand, specifying the nature of such claim or demand and the amount or the
estimated amount thereof to the extent then feasible (which estimate shall not
be conclusive of the final amount of such claim and demand) (the "Claim
Notice"). Indemnitor shall thereupon, at its sole cost and expense, defend such
Indemnitee against such claim or demand with counsel reasonably satisfactory to
such Indemnitee.
                      (b) The Indemnitor shall not,  without the prior written
consent of such Indemnitee, consent to the entry of any judgment against such
Indemnitee or enter into any settlement or compromise which does not include, as
an unconditional term thereof (i.e., there being no requirement that such
Indemnitee pay any amount of money or give any other consideration), the giving
by the claimant or plaintiff to such Indemnitee of a release, in form and
substance satisfactory to such Indemnitee, from all liability in respect of such
claim or litigation. If such Indemnitee desires to participate in, but not
control, any such defense or settlement, it may do so at its sole cost and
expense. If, in the reasonable opinion of such Indemnitee, any such claim or
demand or the litigation or resolution of any such claim or demand involves an
issue or matter which could have a materially adverse effect on the business,
operations, assets, properties or prospects of such Indemnitee, then such
Indemnitee shall have the right to control the defense or settlement of any such
claim or demand and its costs and expenses shall be included as part of the
indemnification obligation of Indemnitor; provided, however, that such
Indemnitee shall not settle any such claim or demand without the prior written
consent of Indemnitor, which consent shall not be unreasonably withheld or
delayed. If such Indemnitee should elect to exercise such right, the Indemnitor
shall have the right to participate in, but not control, the defense or
settlement of such claim or demand at its sole cost and expense.
                      (c) The  term  Indemnitee  as used in this  Article  13
shall also include the employees, officers and shareholders of the respective
parties, it being the intent of the parties that the rights and benefits of an
Indemnitee hereunder shall inure to the benefit of such employees, officers and
shareholders to the extent an such claim or demand is asserted against any of
them in their individual capacities.
                  13.4 Payment; Right of Setoff.2.5 Stock Escrow Agreement. In
order to provide further security for the indemnification rights of the
Indemnified Purchaser Party under this Article IX, the Preferred Shares shall be
held in escrow for a period of one (1) year from the Closing Date and disposed
of as provided in the Stock Escrow Agreement described in Section 5.11.1
hereof.9.3 Payment; Right of Setoff.2.5 Stock Escrow Agreement. In order to
provide further security for the indemnification rights of the Indemnified
Purchaser Party under this Article IX, the Preferred Shares shall be held in
escrow for a period of one (1) year from the Closing Date and disposed of as
provided in the Stock Escrow Agreement described in Section 5.11.1 hereof.9.3
Payment; Right of Setoff.2.5 Stock Escrow Agreement. In order to provide further
security for the indemnification rights of the Indemnified Purchaser Party under
this Article IX, the Preferred Shares shall be held in escrow for a period of
one (1) year from the Closing Date and disposed of as provided in the Stock
Escrow Agreement described in Section 5.11.1 hereof.9.3 Payment; Right of
Setoff. Within ten (10) days after such determination of liability under this
Article 13 and written notification to Indemnitor thereof, Indemnitor shall pay
to the Indemnitee the amount of any such claim for indemnification. Further,
pending final determination of any claims, demands or disputes in accordance
with the provisions of Article 13, Indemnitee shall have the right to withhold
from any amounts due pursuant to this Agreement or any other agreement between
Seller and Purchaser the amount of such claims, demands and/or disputes. Upon
the final payment in full of any claim, either by setoff or otherwise, the
Indemnitor shall be subrogated to the rights of the Indemnitee against any
person, firm or corporation with respect to the subject matter of such claim.
                  13.5 Other Rights and Remedies Not Affected.4 Other Rights and
Remedies Not Affected.4 Other Rights and Remedies Not Affected.4 Other Rights
and Remedies Not Affected. The indemnification rights of the parties under this
Article 13 are independent of and in addition to such rights and remedies as the
parties may have at law or in equity or otherwise for any misrepresentation,
breach of warranty or failure to fulfill any agreement or covenant hereunder on
the part of any party hereto, including, without limitation, the right to seek
specific performance, rescission or restitution, none of which rights or
remedies shall be affected or diminished hereby.
         14. Risk of Loss. Except for supplies expended in the ordinary course
of business, if a significant part of the Assets are damaged or destroyed by
fire, explosion, flood, lightning, or other natural disaster prior to closing,
Seller or Purchaser shall be entitled to terminate this Agreement completely.
         15.  Miscellaneous.
                  15.1 Expenses. Except as otherwise specifically provided in
this Agreement, each of the parties shall bear its own expenses in connection
herewith and with respect to any transactions and negotiations contemplated
hereby, whether or not consummated for any reason.
                  15.2 Sales, Transfer and Documentary Taxes. Purchaser shall
pay all federal, state and local sales, documentary and other transfer taxes, if
any, due as a result of the purchase, sale and transfer of the Assets in
accordance herewith whether imposed by law on Seller or Purchaser and Purchaser
shall indemnify, reimburse and hold harmless Seller in respect of the liability
for payment of or failure to pay any such taxes or the filing of or failure to
file any reports required in connection therewith.
                  15.3 Publicity. Neither party may make any press releases,
announcements and other public disclosures regarding the transactions
contemplated hereby without the written consent of the other party, provided,
however, that any party may make any public disclosure it believes in good faith
is required by applicable law concerning its publicly-traded securities (in
which case the disclosing Party will use its reasonable efforts to advise the
other Party prior to making the disclosure).
                  15.4 Equitable Relief. The unauthorized use or disclosure by
Purchaser of any restricted or confidential information prohibited under Section
9.3 hereof would cause irreparable injury to Seller and therefore, Purchaser
agrees that Seller shall be entitled, in addition to any other remedies or
damages available to Purchaser, to seek an injunction to restrain violation of
this Subsection by Purchaser or any of its agents or employees.
                  15.5 Entire Agreement. This Agreement, including the schedules
and exhibits attached hereto, which are a part hereof, constitutes the entire
agreement of the parties with respect to the subject matter hereof. The
representations, warranties, covenants and agreements set forth in this
Agreement constitute all the representations, warranties, covenants and
agreements of the parties and upon which the parties have relied, shall not be
deemed waived or otherwise affected by any investigation made by any party
hereto and, except as may be specifically provided herein, no change,
modification, amendment, addition or termination of this Agreement or any part
thereof shall be valid unless in writing and signed by or on behalf of the party
to be charged therewith.
                  15.6 Notices. Any and all notices or other communications or
deliveries required or permitted to be given or made pursuant to any of the
provisions of this Agreement shall be deemed to have been duly given or made for
all purposes when in writing and hand delivered or sent by certified or
registered mail, return receipt requested and postage prepaid, overnight mail,
nationally recognized overnight courier or telecopier as follows:




If to Seller at:
New York State Electric & Gas Corporation
Corporate Drive-Kirkwood Industrial Park
P.O. Box 5224
Binghamton, New York 13902-5224
Attention: Manager Research & Development
Telecopier: (607) 762-4002

If to Purchaser:
Alternative Energy Technologies, Inc.
c/o  Save On Energy, Inc.
Airport Industrial Center
4851 Georgia Highway 85, Suite 210
Forest Park, GA     30297
Attention:  Ricky D. Davis
Telecopier:  (404) 765-0171

With a copy to:
Membrado & Montell, LLP
535 West 34th Street
2nd Floor
New York, NY  10001
Attention: Scott Montell, Esq.
Telecopier: (646) 792-2258

or at such other address as any party may specify by notice given to the other
party in accordance with this Section.
                  15.7 Choice of Law; Severability. This Agreement shall be
governed by, and interpreted and construed in accordance with, the laws of the
State of New York, excluding choice of law principles thereof. In the event any
clause, section or part of this Agreement shall be held or declared to be void,
illegal or invalid for any reason, all other clauses, sections or parts of this
Agreement which can be effected without such void, illegal or invalid clause,
section or part shall nevertheless continue in full force and effect.
                  15.8 Successors and Assigns; No Assignment. This Agreement
shall be binding upon and inure to the benefit of the parties and their
respective successors and assigns; provided, however, that neither party may
assign any of its rights or delegate any of its duties under this Agreement
without the prior written consent of the other party.
                  15.9 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, and all of which
taken together shall constitute one and the same instrument.
                  15.10    Facsimile  Signatures.  Signatures  hereon which are
transmitted via facsimile shall be deemed original signatures.
                  15.11 Representation by Counsel; Interpretation. Purchaser
acknowledges that it has been represented by counsel or has had the opportunity
to be represented by counsel in connection with this Agreement and the
transactions contemplated by this Agreement. Accordingly, any rule or law or any
legal decision that would require interpretation of any claimed ambiguities in
this Agreement against the party that drafted it has no application and is
expressly waived by such parties. The provisions of this Agreement shall be
interpreted in a reasonable manner to effect the intent of the parties hereto.
                  15.12 Headings; Gender. The headings, captions and/or use of a
particular gender under sections of this Agreement are for convenience and
reference only and do not in any way modify, interpret or construe the intent of
the parties or affect any of the provisions of this Agreement.
                  15.13 Survival. The terms and provisions of this Agreement, to
the extent necessary or contemplated, shall survive the Closing of this
Agreement. Without limiting the foregoing, it is expressly agreed that all
disclaimers of warranty and disclaimers of representations contained in this
Agreement, including, without limitation, those set forth in Sections 5.1 and
7.5 hereof, shall survive Closing.


<PAGE>





         IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date and year first above written.


             SELLER:
             New York State Electric & Gas Corporation
             By:   /s/   Dennis R. Urgento
                --------------------------
                         Dennis R. Urgento, Vice President-Customer
                         Engineering & Delivery


             PURCHASER:
             Alternative Energy, Inc.

             By:  /s/ Robby Davis
                -----------------
                      Robby Davis, Chief Financial Officer


<PAGE>



                                   EXHIBIT 2.2
                             SECURED PROMISSORY NOTE

                      ALTERNATIVE ENERGY TECHNOLOGIES, INC.
                             SECURED PROMISSORY NOTE

USD$307,800                                             As of  December __, 2001
                                                                    New York, NY

         WHEREAS, the parties hereto entered into a Asset Purchase Agreement
dated as of October 29, 2001, pursuant to which Alternative Energy Technologies,
Inc. agreed to purchase certain of the assets of New York State Electric & Gas
Corporation (the "Asset Purchase Agreement"); and

         WHEREAS, terms used herein but not defined shall have the meaning
assigned to them in the Asset Purchase Agreement; and

         WHEREAS, pursuant to the terms Asset Purchase Agreement the Closing was
scheduled to occur on November 1, 2001 and the Purchase Price was payable in
full at the Closing; and

         WHEREAS,  AET  requested  that  the  Closing  be  postponed  and  that
the  Purchase  Price  be  paid  in installments; and

         WHEREAS, NYSEG is willing to accept AET's request subject to various
terms and conditions agreed to by the parties; and

         WHEREAS, the Payee, as hereinafter defined, has agreed, at the request
of the Maker, to accept payment for the Assets in accordance with the terms of
this Secured Promissory Note;

         NOW THEREFORE,

         FOR VALUE RECEIVED, ALTERNATIVE ENERGY TECHNOLOGIES, INC., a New York
corporation (the "Maker"), having an address at Airport Industrial Center, 4851
Georgia Highway 85, Suite 210, Forest Park, GA 30297, (the "Maker") , hereby
promises to pay to the order of NEW YORK STATE ELECTRIC & GAS CORPORATION, a New
York transportation corporation (the "Payee"), having an address at Corporate
Drive-Kirkwood Industrial Park, PO Box 5224, Binghamton, New York 13902-5224, or
at such other place as the Payee may from time to time designate in writing, in
immediately available United States funds, the principal sum of THREE HUNDRED
AND SEVEN THOUSAND EIGHT HUNDRED DOLLARS ($307,800), together with interest on
the outstanding principal balance from the date hereof at the rate of eight
percent (8%) per annum from November 1, 2001 (which shall be the effective date
of this Note), subject to the terms hereof, payable as follows:


<PAGE>



                  I.       SEVENTY  THOUSAND  DOLLARS  ($70,000) shall be due
and payable on the date hereof,  such payment representing a payment of
principal and no interest.

                  II. FIFTY THOUSAND DOLLARS ($50,000), together with all
accrued interest on the unpaid principal balance hereunder, including, without
limitation, accrued interest from November 1, 2001, shall be due and payable on
March 31, 2002.

                  III.     FIFTY  THOUSAND  DOLLARS  ($50,000),  together  with
all accrued  interest on the unpaid principal balance hereunder,  shall be due
and payable on June 30, 2002.

                  IV.      FIFTY  THOUSAND  DOLLARS  ($50,000),  together  with
all accrued  interest on the unpaid principal balance hereunder,  shall be due
and payable on  September 30, 2002.

                  V.       FIFTY  THOUSAND  DOLLARS  ($50,000),  together  with
all accrued  interest on the unpaid principal balance hereunder,  shall be
payable on December  31, 2002.

                  IV.      The entire unpaid  principal  balance,  together with
all accrued interest on the unpaid principal balance hereunder, shall be due and
payable on March 31, 2003.

         1.       Security.  This Note is executed  concurrently  with a certain
Security Agreement (the "Security Agreement") of even date herewith between the
Maker and the Payee. Pursuant to the Security Agreement, the Maker has pledged
all of its assets as collateral to Payee to secure its prompt and full
performance of its obligations hereunder.

         2.       Representations  & Warranties  of Maker.  The Maker hereby
represents and warrants to the Payee (which representations and warranties shall
be deemed to be repeated by the Maker on each day any amounts remain outstanding
hereunder) that:

                  (a) Corporate  Organization & Standing.  It is a corporation
duly organized, validly existing, and in good standing under the laws of New
York.

                  (b)  Corporate  Power &  Authority.  It has full  corporate
power and authority to perform its obligations hereunder.

                  (c) Due Authorization, Execution and Delivery. It has taken
all requisite corporate and other action to authorize the execution, delivery
and performance of this Note and the transactions contemplated hereby. This Note
has been duly executed and delivered by it.

                  (d) Binding Obligations; No Violation. This Note constitutes a
legal, valid and binding obligation of Maker, enforceable against Maker in
accordance with its terms. The execution, delivery and performance of this Note
and the payment of all amounts due hereunder by Maker will not (i) violate any
provision of its Certificate of Incorporation or Bylaws, (ii) conflict with or
result in the breach of any material provision of, or give rise to a default
under, any agreement with respect to indebtedness or of any other material
agreement to which Maker is a party or by which it or any of its properties or
assets are bound or (iii) conflict with any law, statute, rule or regulation or
any order, judgment or ruling of any court or other agency of government to
which it is subject or any of its properties or assets may be bound or affected.

                  (e) Proceedings. There are no legal actions, suits,
arbitration proceedings, official investigations or other proceedings pending or
threatened against the Maker that if adversely determined would materially
affect the financial condition of Maker or the validity or enforceability of, or
Maker's ability to perform its obligations hereunder.

         3. Acceleration. In the event the Maker shall fail to make any payment
due hereunder and such failure shall continue unremedied for a period of five
(5) days following written notice to Maker by Payee of such default then the
Payee may, by written notice to the Maker, declare the entire unpaid principal
amount of this Note then outstanding to be forthwith due and payable, whereupon
the same shall become forthwith due and payable.

         4.       Miscellaneous.

         Notwithstanding anything to the contrary contained in this Note, the
rate of interest payable on this Note shall never exceed the maximum rate of
interest permitted under applicable law.

This Note may not be waived, changed, modified or discharged orally, but only by
an agreement in writing, signed by the party against whom enforcement of any
waiver, change, modification or discharge is sought.

<PAGE>

         The Maker and any endorsers hereof, for themselves and their respective
representatives, successors and assigns, expressly (a) waive presentment,
protest, notice of dishonor, notice of non-payment, notice of maturity, notice
of protest, diligence in collection, and the benefit of any applicable
exemptions, including, but not limited to, exemptions claimed under insolvency
laws, and (b) consent that the Payee may release or surrender, exchange or
substitute any property or other collateral or security now held or which may
hereafter be held as security for the payment of this Note, and/or may release
any guarantor, and/or may extend the time for payment and/or otherwise modify
the terms of payment of any part or the whole of the debt evidenced hereby.

         All payments made hereunder shall be applied first to payment of
interest on the principal balance outstanding hereunder from time to time and
then to principal.

         Any notice, demand or request relating to any matter set forth herein
shall be in writing and shall be deemed effective when hand delivered, when
mailed by registered or certified mail (postage prepaid, return receipt
requested), or by overnight mail or courier, or when sent by facsimile
transmission to the Maker at its address stated herein or at such other address
of which it shall have notified the Payee in writing as aforesaid.

         This Note shall be governed by, and construed in accordance with, the
laws of the State of New York, excluding conflict of law principles thereof.


                                                     ALTERNATIVE ENERGY
                                                     TECHNOLOGIES,     INC.


                                                     By:   /s/ Robert Stiles
                                                        ---------------------
                                                        Name:  Robert Stiles
                                                        Title:    President







<PAGE>

                                   EXHIBIT 2.3
                               SECURITY AGREEMENT

         SECURITY AGREEMENT (this "Agreement"), made as of the ___ day of
December, 2001, by and between ALTERNATIVE ENERGY TECHNOLOGIES, INC., a New York
corporation ("AET"), and NEW YORK STATE ELECTRIC & GAS CORPORATION, a New York
corporation ("NYSEG").

         WHEREAS, the parties hereto entered into a Asset Purchase Agreement
dated as of October 29, 2001 pursuant to which AET agreed to purchase certain of
the assets of NYSEG (the "Asset Purchase Agreement"); and

         WHEREAS, terms used herein but not defined shall have the meaning
assigned to them in the Asset Purchase Agreement; and

         WHEREAS, pursuant to the terms Asset Purchase Agreement the Closing was
scheduled to occur on November 1, 2001 and the Purchase Price was payable in
full at the Closing; and

         WHEREAS,  AET  requested  that  the  Closing  be  postponed  and  that
the  Purchase  Price  be  paid  in installments; and

         WHEREAS, NYSEG is willing to accept AET's request subject to various
terms and conditions agreed to by the parties; and

         WHEREAS, as a condition of NYSEG waiving its right to enforce the
original Closing Date, AET has agreed to compensate NYSEG for all of the
operating expenses, less any revenues generated, in running the Business between
November 1, 2001 and the date hereof pursuant to a Tracking Account Agreement of
even date herewith by AET for the benefit of NYSEG ("Tracking Agreement"); and

WHEREAS, in partial payment for the Assets to be conveyed pursuant to an Asset
Purchase Agreement, AET issued to NYSEG a secured promissory note of even date
herewith in the original principal amount of $307,800 (the "Note"); and

     WHEREAS, it is a condition to the consummation of the transactions
described herein, AET grants to NYSEG the security interest set forth herein.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:




<PAGE>


         1.       Definitions.

                  (a)      The term  "Obligations"  shall mean any and all
obligations  of AET  arising  under the Note and the Tracking Agreement.

                  (b) The term "Collateral" shall mean any and all tangible and
intangible assets in which AET has or shall have an interest, now or hereafter
existing or acquired, and wherever located, together with all additions and
accessions thereto and replacements and substitutions thereof and all proceeds
and products of the foregoing, including, without limitation, the assets
transferred to AET pursuant to the Asset Purchase Agreement.

                  (c) All other terms used herein which are not otherwise
defined herein and are defined in the Uniform Commercial Code of the State of
New York, or any state where AET's assets are located, as applicable
(collectively, the "UCC"), shall have the meanings therein stated.

         2. Grant of Security Interest. AET hereby grants to NYSEG a valid and
binding first priority security interest in the Collateral (the "Security
Interest") as security for the payment, performance, and observance by AET of
the Obligations, which Security Interest shall be senior to any and all other
security interests of any kind.

         3.       Representations and Warranties.  AET represents and warrants
to NYSEG as follows:

                  (a) Authority. The execution and delivery by AET of this
Agreement, and each of the other documents relating hereto (collectively with
this Agreement, the "Security Documents") and the performance of AET's
obligations hereunder and thereunder: (i) are within AET's corporate powers;
(ii) are duly authorized by AET's Board of Directors and stockholders, if
required; (iii) are not in contravention of the terms of AET"s Certificate of
Incorporation or By-laws, or of any indenture, agreement or undertaking to which
AET is a party or by which AET or any of its assets or property is bound or
affected; (iv) do not, as of the date of execution hereof, require the consent,
approval or authorization of or declaration, registration or filing with any
governmental body or any nongovernmental person or entity (except for the filing
of the UCC-1 and other financing statements and/or this Agreement contemplated
hereby; (v) do not contravene any contractual or governmental restriction
binding upon AET; and (vi) will not, except as contemplated herein, result in
the imposition of any liens, security interests or encumbrances of any nature
whatsoever (collectively, "Liens") upon any assets or property of AET under any
existing indenture, mortgage, deed of trust, loan or credit agreement or other
agreement or instrument to which AET is a party or by which it or any of its
assets or property may be bound or affected.

                  (b) Binding Effect. The Security Documents have been duly
executed and delivered on behalf of AET and constitute the legal, valid and
binding obligations of AET enforceable against AET in accordance with their
terms.

                  (c) Full Disclosure. No representation or warranty in this
Agreement contains, or will contain, any untrue statement of any material fact
as of the date when made or omits, or will omit, to state any material fact as
of the date when made or omits, or will omit, to state any material fact
necessary to make the statements herein or therein not misleading as of the date
when made; there is no fact known to AET that has not been disclosed to NYSEG in
writing which materially and adversely affects or would materially and adversely
affect the business, financial condition or operations of AET.

         4.       Affirmative  Covenants.  From and  after the date  hereof  and
continuing  so long as any of the Obligations shall remain unpaid, unless NYSEG
shall otherwise consent in advance and in writing:

                  (a)      Perfection of Security Interest.

                           (i)      AET will,  from time to time, do whatever
NYSEG may reasonably request by way of obtaining, executing, delivering and/or
filing financing statements, copyright mortgages, patent collateral assignments
and the like, and other notices and amendments and renewals thereof, and will
take any and all steps and observe such formalities as NYSEG may request, in
order to create, perfect and maintain valid continuing Liens upon the Collateral
consistent with the Security Interest and as contemplated by this Agreement.



<PAGE>


(ii) AET hereby irrevocably appoints NYSEG as its lawful attorney-in-fact and
agent, with full power of substitution, to execute and deliver, on behalf of and
in the name of AET, such financing statements, assignments, notices, pledges and
other documents and agreements, and to take such other actions as NYSEG may deem
reasonably necessary for the purpose of the creation, perfection, maintenance or
continuation of the Security Interest, under any applicable law, and NYSEG is
hereby authorized to file on behalf of and in the name of AET, at AET's expense,
such financing statements, assignments, notices, pledges and other documents and
agreements in any appropriate governmental office. The right is expressly
granted to NYSEG, in its discretion, in those jurisdictions where the same is
permitted, to file one or more financing statements (including amendments and
renewals thereof) under the UCC or similar law or under federal and/or foreign
patent, copyright and/or trademark law signed only by NYSEG, naming AET as
debtor and naming NYSEG as secured party and indicating therein the types, or
describing the items, of the Collateral. This power of attorney is coupled with
an interest and irrevocable while any of the Obligations shall remain unpaid.

                  (b)      Tax Obligations.

                           (i)      AET shall file all tax and  information
returns and reports required by all applicable taxing authorities (all prepared
in accordance with applicable law), pay or cause to be paid all license fees and
related taxes and charges, and pay or cause to be paid all income, employment,
real and personal property taxes and other governmental taxes and charges
assessed against AET, or payable by AET, at such times and in such manner as to
prevent any penalty or interest from accruing thereon, or any Lien or charge
from attaching to the Collateral; provided that AET shall have the right to
contest any such fees, premiums, taxes and charges prior to the payment thereof
for so long as such contest is pursued diligently and in good faith by
appropriate proceedings.

                           (ii)     AET shall  notify  NYSEG  promptly  (and in
no event later than fifteen (15) days) after becoming aware of the intent of the
Internal Revenue Service or other taxing authority (the "Taxing Authority") to
assert a deficiency with respect to it, and shall promptly (and in no event
later than fifteen (15) days following receipt of any notice of deficiency)
inform NYSEG of such proposed deficiency and deliver to NYSEG a copy of any
notices of deficiency received from the Taxing Authority. If NYSEG so requests,
and if there is a reasonable legal basis therefor, AET shall take all reasonable
actions necessary to contest such claimed deficiency and shall appoint outside
tax counsel reasonably acceptable to NYSEG to contest such claims of deficiency
and shall direct such counsel to consult with and to provide NYSEG with periodic
status reports and assessments of the legal merits of the contest. At NYSEG's
request, such contest shall continue through the appropriate administrative and
court procedures, including appeals therefrom, until such outside tax counsel
informs AET that further contest would be inadvisable taking into account all
factors (including any settlement or compromise proposed by the Taxing
Authority).



<PAGE>


                  (c) Further Assurances. AET shall at any time or from time to
time execute and deliver such further instruments and documents and take such
further action as may reasonably be requested by NYSEG to carry out, to NYSEG's
reasonable satisfaction, the transactions contemplated by Security Documents.

                  (d) Indemnification. AET shall indemnify, defend and hold
harmless NYSEG and its officers, directors, agents and employees from and
against all losses, costs, fines, liabilities, judgments, actions, penalties,
damages, injuries, claims, demands, disbursements and expenses, including
reasonable attorneys' fees and costs, arising out of (i) the execution or
consummation of this Agreement and the other Security Documents; (ii) the
operation or maintenance of any of the Collateral; or (iii) any aspect of, or
any transaction contemplated by or referred to in, or any matter related to,
this Agreement, in each case whether or not AET or such holder is a party
thereto, except to the extent such losses, cost, fines, liabilities, judgments,
actions, penalties, damages, injuries, claims, demands, disbursements and
expenses are directly caused by the gross negligence or willful misconduct of
NYSEG or such holder or their respective agents, servants or employees. AET
shall assume the settlement and defense of any suit or other legal proceeding
brought to enforce any of the foregoing (with counsel reasonably satisfactory to
NYSEG), and shall pay all judgments entered in any such suit or legal
proceeding. AET shall not compromise or settle any such suit or other legal
proceeding without the prior written consent of NYSEG, which consent shall not
be unreasonably withheld or unduly delayed. The indemnities and assumptions of
liabilities and obligations herein provided for shall continue in full force and
effect notwithstanding the termination of this Agreement.

         5.       Negative  Covenants.  From  and  after  the date  hereof,  and
continuing  so long as any of the Obligations shall remain unpaid, unless NYSEG
shall otherwise consent in advance and in writing:

                  (a) Liens. AET will not create or suffer to exist any Lien
upon or with respect to the Collateral which is superior in rank to the Lien
created hereby, except Liens in favor of NYSEG.

                  (b) Amendments. AET will not request, permit or consent to any
amendment to its Certificate of Incorporation, By-Laws or other organizational
documents, which amendment could have a material adverse effect on the Security
Interest or otherwise on NYSEG in its capacity as a secured party under this
Agreement.



<PAGE>


         6. Inspection and Audit. From and after the date hereof, and continuing
so long as any of the Obligations shall remain unpaid, AET will permit NYSEG, or
any person designated by NYSEG in writing, from time to time hereafter, to enter
AET's place or places of business (or any other place where the Collateral or
any information relating thereto is kept or located) during all business hours
upon not less than three (3) business days' prior notice, and, without hindrance
or delay (provided that NYSEG or such designees shall not unreasonably disrupt
the day-to-day operations of AET), (i) to inspect, audit, check and make copies
of and extracts from AET's books, records, journals, orders, receipts and any
correspondence and other data relating to the Collateral, the Security Interest
and the Security Documents to an extent within its own discretion, (ii) to take
such steps as AET deems reasonably necessary to verify the accuracy and
completeness of the foreoing, and (iii) to reasonably discuss any issues
relating thereto with any of NYSEG's officers, directors or outside auditors.

         7. Remedies on Default. Upon the occurrence of any one or more defaults
under the Note, NYSEG shall have the following rights and remedies in addition
to all rights and remedies of a secured party under the UCC, federal and/or
foreign patent, copyright and/or trademark law or other applicable statute or
rule, in any jurisdiction in which enforcement is sought, all such rights and
remedies being cumulative and not exclusive:

                  (a) Collateral. (i) NYSEG may at any time and from time to
time, with or (if and to the extent permitted by applicable law) without process
of law and with or (if and to the extent permitted by applicable law) without
the aid and assistance of others, enter upon any premises in which the
Collateral or any part thereof may be located and, without resistance or
interference by AET, take or otherwise put itself in possession of the
Collateral; and/or dispose of all or any part of the Collateral located on any
premises of AET or its agents; and/or require AET to assemble and make available
to NYSEG all or any part of the Collateral at any place and time reasonably
designated by NYSEG; and/or remove all or any part of the Collateral from any
premises on which any part thereof may be located for the purpose of effecting
preservation or sale or other disposition thereof; and/or sell, resell, lease,
assign and deliver, or otherwise dispose in good faith of, the Collateral or any
part thereof in its existing condition on commercially reasonable terms or
following any commercially reasonable preparation or processing, at public or
private proceedings, in one or more parcels at the same or different times with
or without having the Collateral at the place of sale or other disposition, for
cash, upon credit or for future delivery, and in connection therewith NYSEG may
grant options, at such place or places and time or times and to such persons,
firms or corporations on commercially reasonable terms as NYSEG deems
appropriate, and without demand for performance, and/or liquidate or dispose of
the Collateral or any part thereof in any other commercially reasonable manner.
Provided notice has been given in accordance herewith, failure of AET to contest
within a reasonable period on the grounds of commercial reasonability shall be
deemed a waiver of said defense.

                           (ii) If any of the  Collateral  is sold by NYSEG
upon credit or for future delivery, NYSEG shall not be liable for the failure of
the purchaser to pay for the same and, in the event of any such failure, NYSEG
may, in accordance with any applicable credit or related agreements, resell such
Collateral. NYSEG may buy any part or all of the Collateral at any public sale
and, if any part of the Collateral is of a type which is the subject of widely
distributed standard price quotations, NYSEG may buy at a private sale, all free
from any equity or right of redemption, which is hereby waived and released by
AET, and NYSEG may make payment therefor (by endorsement without recourse) in
notes of NYSEG.

                           (iii)  NYSEG  may  apply  the cash  proceeds
actually received from any sale or other disposition of the Collateral in
accordance herewith to the reasonable expenses of retaking, holding, preparing
for sale, selling, leasing and the like, reasonable legal fees and expenses,
court costs, collection charges, travel and other expenses which may be incurred
by NYSEG in attempting to collect the Obligations or to enforce this Agreement
and realize proceeds upon conversion of the Collateral, or in the prosecution or
defense of any action or proceeding related to the subject matter of this
Agreement; and then to the Obligations in such order as to principal and/or
interest due as NYSEG may in its sole reasonable discretion determine; and AET
shall at all times be and remain liable and, after crediting the net proceeds of
sale or other disposition as aforesaid, will pay NYSEG on demand any deficiency
remaining, including interest thereon and the balance of any expenses at any
time unpaid, with any surplus to be paid to AET, subject to any duty of NYSEG to
the holder of any subordinate security interest in the Collateral known to
NYSEG, but only to the extent required by law.

                  (b) Proceeds. Any of the proceeds of the Collateral received
by AET shall not be commingled with other property of AET, but shall be
segregated, held by AET in trust for NYSEG as the exclusive property of NYSEG,
and AET will immediately deliver to NYSEG the identical checks, moneys or other
proceeds of Collateral received, and NYSEG shall have the right to endorse the
name of AET on any and all checks, or other forms of remittance received, where
such endorsement is required to effect collection. AET hereby designates,
constitutes and appoints NYSEG and any designee or agent of NYSEG as
attorney-in-fact of AET, irrevocably and with power of substitution, to endorse
the name of AET on any notes, acceptances, checks, drafts, money orders or other
evidences of payment or proceeds of the Collateral that may come into NYSEG's
possession; to sign the name of AET on any invoices, documents, drafts against
account debtors of AET, assignments, requests for verification of accounts and
notices to debtors of AET; to execute any endorsements, assignments, or other
instruments of conveyance or transfer; and to do all other acts and things
necessary and advisable in the sole discretion of NYSEG to carry out and enforce
this Agreement. Said attorney or designee shall not be liable for any acts or
commission or omission nor for any error of judgment or mistake of fact or law.
This power of attorney is coupled with an interest and irrevocable while any of
the Obligations shall remain unpaid.



<PAGE>


         8. Liability Disclaimer. Except for reasonable care of Collateral in
its possession, if any, under no circumstances whatsoever shall NYSEG be deemed
to assume any responsibility for, or obligation or duty with respect to, any
part or all of the Collateral, of any nature or kind whatsoever, or any matter
or proceeding arising out of or relating thereto. NYSEG shall not be required to
take any action of any kind to collect or protect any interest in the
Collateral, including, but not limited to, any action necessary to preserve its
or AET's rights against prior parties to any of the Collateral. NYSEG shall not
be liable or responsible in any way for the safekeeping, care or custody of any
of the Collateral (except for reasonable care of Collateral in its possession),
or for any loss or damage thereto, or for any diminution in the value thereof,
or for any act or default of any agent or bailee of NYSEG or AET, or of any
carrier, forwarding agency or other person whomsoever, or for the collection of
any proceeds, but the same shall be at AET's sole risk at all times. AET hereby
releases NYSEG from any claims, causes of action and demands at any time arising
out of or with respect to this Agreement or the Obligations, and any actions
taken or omitted to be taken by NYSEG with respect thereto, except for such
claims, causes of action, demands and/or actions directly caused by NYSEG's
gross negligence or willful misconduct, and AET agrees to defend and hold NYSEG
harmless from and with respect to any and all such claims, causes of action and
demands, except for such claims, causes of action, demands and/or actions
directly caused by NYSEG's gross negligence or willful misconduct. NYSEG's prior
recourse to any part or all of the Collateral shall not constitute a condition
of any demand for payment of the Obligations or of any suit or other proceeding
for the collection of the Obligations.

         9. Nonwaiver. No failure or delay on the part of NYSEG in exercising
any of its rights and remedies hereunder or otherwise shall constitute a waiver
thereof, and no single or partial waiver by NYSEG of any default or other right
or remedy which it may have shall operate as a waiver of any other default,
right or remedy or of the same default, right or remedy on a future occasion.

         10. Waivers. AET hereby waives presentment, notice of dishonor and
protest of all instruments included in or evidencing any of the Obligations or
the Collateral and any and all other notices and demands whatsoever (except as
expressly provided herein) whether or not relating to such instruments. In the
event of any litigation at any time arising with respect to any matter connected
with this Agreement or the Obligations, AET hereby waives the right to a trial
by jury and AET hereby waives any and all rights of setoff and rights to
interpose counterclaims of any nature except for counterclaims which are
compulsory or which would be lost for failure to be raised.

         11.      Binding  Effect.  This Agreement and all  Obligations of AET
hereunder shall be binding upon the successors or assigns of AET, and shall,
together with the rights and remedies of NYSEG hereunder, inure to the benefit
of NYSEG and its successors, endorsees and assigns.

         12. Application of Payments. In addition to its other rights herein,
NYSEG shall have the continuing and exclusive right to apply or reverse and
reapply any and all payments to any portion of the Obligations. To the extent
that AET makes a payment or payments to NYSEG or NYSEG receives any payment or
proceeds of any security for such Obligations for AET's benefit, which
payment(s) or proceeds or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, state
or federal law, common law or equitable cause, then, to the extent of such
payment or proceeds received, the Obligations or part thereof intended to be
satisfied shall be revived and continue in full force and effect, as if such
payment or proceeds had not been received by NYSEG.



<PAGE>





         13. Consent to Jurisdiction. AET agrees that (i) any state or federal
court within the State of New York shall have personal jurisdiction over AET,
and (ii) service of any summons and complaint or other process in any such
action or proceeding may be made by registered or certified mail directed to AET
at AET's address set forth below, and service so made shall be deemed to be
completed upon the earlier of actual receipt or three (3) days after the same
shall have been posted as aforesaid, AET hereby waiving personal service
thereof. Nothing in this paragraph shall affect the right of NYSEG to serve
legal process in any other manner permitted by law or affect the right of NYSEG
to bring any action or proceeding against AET or its property in the courts of
any other jurisdiction. AET and NYSEG agree that any claim or suit between or
among the parties hereto involving this Agreement, any of the other Security
Documents or any transactions contemplated hereby or thereby shall be brought in
and decided by the state or federal courts located in New York County, New York.

         14. Entire Agreement. This Agreement and the schedules attached hereto
constitutes the entire agreement of the parties with respect to the subject
matter hereof and there are no representations, warranties or commitments except
as set forth herein. This Agreement supersedes all prior agreements,
understandings, negotiations and discussions, whether written or oral, of the
parties hereto relating to the matters set forth in this Agreement. The
representations, warranties, covenants and agreements set forth in this
Agreement constitute all the representations, warranties, covenants and
agreements of the parties and upon which the parties have relied, shall not be
deemed waived or otherwise affected by any investigation made by any party
hereto and, except as may be specifically provided herein, no change,
modification, amendment, addition or termination of this Agreement or any part
thereof shall be valid unless in writing and signed by or on behalf of the party
to be charged therewith.

         15. Notices. Any and all notices or other communications or deliveries
required or permitted to be given or made pursuant to any of the provisions of
this Agreement shall be in writing and shall be deemed to have been duly given
or made for all purposes when hand delivered or sent by certified or registered
mail, return receipt requested and postage prepaid, overnight mail or courier,
or telecopier to the addresses set forth in the Asset Purchase Agreement or at
such other address as any party may specify by notice given to the other party
in accordance with this paragraph 15.

         16. Choice of Law; Severability. This Agreement shall be governed by,
and interpreted and construed in accordance with, the laws of the State of New
York applicable to agreements performed wholly within such state. In the event
any clause, section or part of this Agreement shall be held or declared to be
void, illegal or invalid for any reason, all other clauses, sections or parts of
this Agreement which can be effected without such void, illegal or invalid
clause, section or part shall nevertheless continue in full force and effect.

17.      Headings.  The section  headings of this  Agreement are for
convenience and reference only and do not in any way modify, interpret or
construe the intent of the parties or affect any of the provisions of this
Agreement.

         18.      Counterparts.     This Agreement may be executed in two or
more counterparts for the convenience of the parties hereto, each of which
executed counterparts shall be deemed an original but all of such executed
counterparts shall be considered one and the same agreement.

         19.      Facsimile  Signatures.   Signatures hereon which are
transmitted via facsimile shall be deemed original signatures.

                  IN WITNESS  WHEREOF,  the  undersigned  have executed this
Agreement as of the date first written above.

                 NEW YORK STATE ELECTRIC & GAS       CORPORATION
                 By:   /s/ Dennis R. Urgento
                      -----------------------
                           Dennis R. Urgento, Vice President-Customer
                           Engineering & Delivery

                 ALTERNATIVE ENERGY TECHNOLOGIES, INC.

                 By:   /s/ Robert Stiles
                      -------------------
                           Robert Stiles, President

<PAGE>


                                   EXHIBIT 2.4
                                    GUARANTY

     THIS GUARANTY ("Guaranty"), dated as of this __ day of December, 2001, is
made by SAVE ON ENGERGY, INC. (the "Guarantor"), a Georgia corporation having a
principal place of business located at Airport Industrial Center, 4851 Georgia
Highway 85, Suite 210, Forest Park, GA 30297 in favor of NEW YORK STATE ELECTRIC
& GAS CORPORATION, a New York transportation corporation, having an address at
Corporate Drive-Kirkwood Industrial Park, PO Box 5224, Binghamton, New York
13902-5224 ("NYSEG").

     WHEREAS,  the Guarantor is the parent  corporation and sole  shareholder of
Alternative  Energy  Technologies, Inc., a Georgia corporation ("Buyer"); and

     WHEREAS, in partial payment for the purchase of certain assets from NYSEG
pursuant to a Bill of Sale and other transfer documents of even date herewith,
Buyer issued to NYSGEG a secured promissory note of even date herewith in the
original principal amount of 307,800 (the "Note"); and

       WHEREAS, in connection with said purchase, Buyer also executed a Tracking
Account Agreement of even date herewith for the benefit of NYSEG ("Tracking
Agreement"); and

     WHEREAS, it is a condition to the consummation of the foregoing
transactions that the Guarantor guarantee any and all of the obligations of
Buyer under the Note and the Tracking Agreement;

     NOW, THEREFORE, in consideration of the foregoing and for other and further
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Guarantor agrees as follows:

     1. Guaranty. The Guarantor hereby unconditionally and irrevocably
guarantees to NYSEG the full and prompt payment of all amounts which may be
presently due and owing and all sums which shall in the future become due and
owing to NYSEG (or its permitted endorsees, successors or assigns) under the
Note and the Tracking Agreement, including, without limitation, the payment of
principal, interest, and expenses under either or both (collectively, the
"Guaranteed Obligations").

     2. Authority. The Guarantor has determined that the execution and delivery
of this Guaranty is in its best interests, will create a direct benefit to the
Guarantor, is within its powers, and is in furtherance of its business purposes
and objectives. The execution of this Guaranty by the undersigned person has
been authorized by all necessary corporate action and will not violate the
Guarantor's charter or by-laws or any material agreement, instrument, order,
judgment or decree to which it is a party or by which it is bound.

     3. Guarantee of Payment. This Guaranty constitutes a guarantee of payment,
and not of collection. The liability of the Guarantor hereunder is direct and
unconditional, and may be enforced without requiring NYSEG first to resort to
any other right, remedy, or security. The Guarantor shall not have any right of
subrogation, contribution, reimbursement or indemnity whatsoever, until all of
the Guaranteed Obligations shall have been indefeasibly paid in full.

     4. No Impairment. This Guaranty shall not be released, impaired, affected
by any modification, extension, amendment, release, or other alteration of any
of the Guaranteed Obligations or of any security there for, nor by any
agreements or arrangements whatever with Buyer or anyone else, and the liability
of the Guarantor hereunder shall apply to the Guaranteed Obligations as so
altered, modified.

     5. Primary Obligation. No invalidity, irregularity or unenforceability of
all or any part of the Guaranteed Obligations or of any security therefor
(including, without limitation, as a result of Buyer's bankruptcy,
reorganization or insolvency, or pursuant to any assignment for the benefit of
creditors, receivership, or similar proceeding under any law or with respect to
any party, or by any actions of a trustee in any said proceeding) shall affect,
impair or be a defense to this Guaranty, and this Guaranty shall be a primary
obligation of the Guarantor and nothing shall discharge or satisfy the liability
of the Guarantor hereunder except the full payment and performance of the
Guaranteed Obligations.

     6.  Termination of Guaranty.  This Guaranty is a continuing  Guaranty which
shall remain  effective  until the Guaranteed Obligations have been satisfied in
full.

     7. Default. If the Guarantor should at any time become insolvent or make a
general assignment for the benefit of creditors, or if a petition in bankruptcy
or any insolvency or reorganization proceedings shall be filed or commenced by,
against (and not removed within 30 days) or in respect of the Guarantor, or if
the Guarantor should at any time liquidate, dissolve, wind up its affairs or
cease doing business, or contest, cancel or otherwise terminate the obligations
under this Guaranty, then and in any such event, any and all obligations of the
Guarantor (including the Guaranteed Obligations, whether or not then due) shall,
at the option of NYSEG forthwith become due and payable without notice or other
action of any kind by NYSEG any other party.

     8. Disgorgement of Payments. If any claim is ever made on NYSEG for
repayment or recovery of any amount or amounts received by NYSEG in payment, or
on account of any of the Guaranteed Obligations, and NYSEG repays all or part of
such amount(s), the Guarantor shall be and remain liable hereunder for the
amount so repaid or recovered to the same extent as if such amount had never
originally been received NYSEG, notwithstanding any termination hereof or any
cancellation of any instrument evidencing the Guaranteed Obligations.

     9. Waivers By Guarantor. The Guarantor hereby waives all rights of notice
or demand including, without limitation: notice of acceptance hereof and notice
of any liability to which it may apply; presentment, demand for payment and
protest of any instrument, and notice of dishonor or nonpayment; notice of
default or nonpayment by Buyer; and all other notices to which the Guarantor may
otherwise be entitled. In addition, the Guarantor waives all suretyship defenses
it may have, whether now or in the future. The Guarantor also waives any right
to seek contribution, indemnification, subrogation or reimbursement from Buyer,
until all of the Guaranteed Obligations have been indefeasibly paid in full.

     10. No Implied Waiver By NYSEG. No act, omission, or delay by NYSEG or
course of dealing between NYSEG and the Guarantor and/or Buyer shall constitute
a waiver of the rights and remedies of NYSEG hereunder. No single or partial
waiver NYSEG of any right or remedy which it may have hereunder shall operate as
a waiver of any other right or remedy or of the same right or remedy on a future
occasion. All rights and remedies of NYSEG hereunder shall be cumulative, and no
such right or remedy shall be exclusive of any other right or remedy.

     11. Amendment. No waiver of any rights hereunder and no modification or
amendment of this Guaranty shall be effective unless the same shall be in
writing, duly signed on behalf of NYSEG and each such waiver, modification, or
amendment, if any, shall apply only with respect to the specific instance
involved, and shall in no way impair the rights of NYSEG or the obligations of
the Guarantor to NYSEG in any other respect or at any other time.

     12. Notices. All notices, requests, consents, and other communications
hereunder shall be in writing, shall be addressed to the receiving party's
address set forth above or to such other address as a party may designate by
notice hereunder, and shall be either (i) delivered by hand, (ii) sent by
reputable overnight courier by next day, priority, or (iii) sent by registered
or certified mail, return receipt requested, postage prepaid. All notices,
requests, consents, and other communications hereunder shall be deemed to have
been given either (i) if by hand, at the time of the delivery thereof to the
receiving party at the address of such party set forth above, (ii) if sent by
overnight courier, on the next business day following the day such notice is
delivered to the courier service, or (iii) if sent by registered or certified
mail, on the 5th business day following the day such mailing is made.

     13. Severability. In the event that any court of competent jurisdiction
shall determine that any provision, or any portion thereof, contained in this
Guaranty shall be unreasonable or unenforceable in any respect, then such
provision shall be deemed limited to the extent that such court deems it
reasonable and enforceable, and as so limited shall remain in full force and
effect. In the event that such court shall deem any such provision, or portion
thereof, wholly unenforceable, the remaining provisions of this Guaranty shall
nevertheless remain in full force and effect.

     14. Successors and Assigns. This Guaranty and all obligations hereunder
shall be binding upon the successors and permitted assigns of the Guarantor and
shall, together with the rights and remedies NYSEG hereunder, inure to the
benefit of NYSEG and its permitted successors, endorsees and assigns. The rights
and obligations of the Guarantor under this Guaranty shall not be assigned by
the Guarantor and the rights and obligations of NYSEG under this Guaranty may
only be assigned to a permitted Holder (as such term is defined in the Note) of
the Note.

     15. Entire Agreement. This Guaranty embodies the entire agreement and
understanding between NYSEG and the Guarantor with respect to the subject matter
hereof and supersedes all prior oral or written agreements and understandings
relating to the subject matter hereof. No statement, representation warranty,
covenant, agreement, course of dealing, course of conduct, or course of
performance of any kind not expressly set forth in this Guaranty shall affect,
or be used to interpret, change or restrict, the express terms and provisions of
is Guaranty.

     16. Governing Law. This Guaranty shall be governed by and construed in
accordance with the laws of New York (without giving effect to its conflict of
laws). Any legal action or proceeding with respect to this Guaranty may be
brought in the courts of New York or of the United States of America for the
District of New York, by execution and delivery of this Agreement, the Guarantor
hereby accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The Guarantor hereby
knowingly, voluntarily, intentionally and irrevocably waives, in connection with
any such action or proceeding: (i) any objection, including, without limitation,
any objection to the laying of venue or based on the grounds of forum non
conveniens, which it may now or hereafter have to the bringing of any such
action or proceeding in such respective jurisdictions, and (ii) to the maximum
extent not prohibited by law, any right it may have to a trial by jury in
respect of any litigation directly or indirectly arising out of, under or in
connection with this Guaranty. The Guarantor irrevocably consents to the service
of process of any of the aforementioned courts in any such action or proceeding
by the mailing of copies thereof by registered or certified mail, postage
prepaid, to the Guarantor at the address set forth above, or at such other
address as the Guarantor may provide to NYSEG from time to time. Nothing herein
shall affect the right of NYSEG to serve process in any other manner permitted
by law or to commence legal proceedings or otherwise proceed against the
Guarantor in any other jurisdiction.

         IN WITNESS WHEREOF, the Guarantor has executed this Guaranty as of the
date first set forth above.


                                                     SAVE ON ENERGY, INC.


                                                     By:   /s/  Robert Stiles
                                                         --------------------
                                                         Name:  Robert Stiles
                                                       Title:   President


<PAGE>





                                  EXHIBIT 10.1
                            STOCK PURCHASE AGREEMENT (Composite Version)

         Stock Purchase Agreement (the "Agreement") made as of this 10th day of
December, 2001, by and between Save On Energy, Inc., a Georgia corporation with
its principal place of business located at Airport Industrial Center, 4851
Georgia Highway 85, Suite 210, Forest Park, GA 30297 (the "Corporation"") and
SWI Holdings, Limited, a Corporation organized under the laws of Bermuda (the
"Investor").

                                R E C I T A L S :

         WHEREAS, the Corporation desires to sell and the Investor desires to
purchase, for the consideration set forth herein, subject to the terms and
conditions of this Agreement, (i) 2,600,000 shares (the "Shares") of the common
stock of the Corporation, par value $.001 per share (the "Common Stock"), and
(ii) a warrant (the "Warrant") to purchase up to 250,000 additional shares of
Common Stock (the "Warrant Shares"), such warrant to be substantially in the
form attached hereto as Exhibit A.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties hereby agree as follows:

                                    SECTION 1
                                 SHARE PURCHASE

Subject to and upon the terms and conditions of this Agreement, at the closing
of the transactions contemplated by this Agreement, the Corporation shall sell,
transfer, convey, assign and deliver to the Investor, and the Investor shall
purchase from the Corporation, the Shares and the Warrant, free and clear of all
title defects, objections, liens, pledges, claims, options, charges, security
interests or encumbrances of any nature whatsoever (collectively,
"Encumbrances").

                                    SECTION 2
                                  CONSIDERATION

The Investor agrees to pay to the Corporation the aggregate amount of FIVE
HUNDRED THOUSAND DOLLARS (USD$500,000) in immediately available funds in
consideration of the Shares and the Warrant, such amount to be payable as
follows:

(i)      ONE HUNDRED THOUSAND (USD$100,000) shall be payable at the Closing (the
"Closing Amount");

(ii)     TWO HUNDRED THOUSAND (USD$200,000) shall be payable on or before
December 7, 2001; and

(iii) TWO HUNDRED THOUDSAND (USD$200,000) shall be payable on or before January
15, 2002.






                                    SECTION 3
                                     CLOSING

                  3.1      Closing. A closing  (the  "Closing")  of the
transactions  contemplated  hereby shall take place at the offices of Membrado
Montell,  LLP or such other  mutually  agreeable  location at 10:00 A.M. on the
date hereof.

                  3.2      Action at the Closing.    At the Closing, the parties
shall take the following actions:

                           (a)      The  Corporation  shall  deliver,  or cause
the following to be delivered,  to the Investor:

                                    (i)      stock certificates representing the
Shares in the name of Investor or its designees;
                                    (ii)     the Warrant; and
                                    (iii)   such other  documents,  instruments
and  certificates  as the Corporation shall reasonably request to accomplish the
letter and spirit of this Agreement.

                           (b)      The Investor  shall deliver to the
Corporation  the Closing Amount in cash as set forth in Section 2(i) of this
Agreement.

                                    SECTION 4
                         REPRESENTATIONS OF THE INVESTOR

                  The Investor represents to the Corporation as follows:

                  4.1 Organization. The Investor is a Corporation duly
organized, existing, and in good standing under the laws of Bermuda, and has the
corporate power to conduct the business which it conducts and proposes to
conduct, and is qualified to do business in each jurisdiction in which it is
required to be so qualified.

                  4.2 Due Authorization.  The Investor  has the complete  power
to execute and deliver this Agreement, and consummate all of the transactions
contemplated hereby. This Agreement constitutes the valid and legally binding
obligations of the Investor, enforceable against the Investor in accordance with
its terms.

                  4.3 No Violation. Neither the execution, delivery nor
consummation of the Agreement by the Investor, will, with the passage of time,
the giving of notice, or otherwise, result in a material violation or breach of,
or constitute a default under, any term or provision of any law, rule,
regulation, order, decree, judgment, indenture, mortgage, deed of trust, lease,
instrument, contract, agreement or other restriction to which the Investor is a
party or to which the Investor, or its property is subject or bound.

                  4.4 Receipt and Review of Certain Information. The Investor
has had a thorough and adequate opportunity to ask questions of the Corporation,
or a person or persons acting on its behalf, concerning the Corporation and the
terms and conditions of the investment described in this Agreement, and all such
questions have been answered to the full satisfaction of the Investor. The
Investor has also had the opportunity to review any documents relating to the
Corporation that its representatives have requested and to otherwise conduct due
diligence, and such due diligence review has been fully satisfactory to the
Investor. The Investor understands and acknowledges that the Corporation cannot
provide assurances with respect to any projections or predictions as to the
future business or financial performance of the Corporation.

                  4.5 Risk Associated with Investment in the Common Stock. The
Investor recognizes that an investment in the Common Stock involves a high
degree of risk for an indefinite period of time, and it has taken full
cognizance of and understands all of the risks related thereto.

                  4.6 Not an Underwriter. The Investor is not an "underwriter"'
as defined in Section 2(a)(11) of the Securities Act, and is acquiring the
Common Stock for investment purposes only.

                  4.7 Financial Ability. The Investor has the financial ability
to bear the economic risk of its investment, including a total loss of the
investment, has adequate means for providing for its current needs and personal
contingencies and has no need for liquidity with respect to its investment in
the Shares or the Warrant Shares (to the extent that the Warrant is exercised).
The Investor recognizes that the purchase of Common Stock involves a high degree
of risk in that:

(i)                        an investment in the Corporation is highly
                           speculative and only investors who can afford the
                           loss of their entire investment should consider
                           investing in the Corporation and the Common Stock;

(ii)    an investor may not be able to liquidate his, her or its investment; and

(iii) in the event of a disposition, an investor could sustain the loss of his,
her or its entire investment.

                  4.8 Brokers. The Investor agrees to indemnify and hold
harmless the Corporation from liability for any compensation to any finder,
broker, agent, financial advisor or other intermediary retained by it in
connection with the transactions contemplated by this Agreement and the fees and
expenses of defending against such liability or alleged liability.

                  4.9      Regulation S.

                           4.9.1    Exemption from Registration  Requirements.

The Investor understands that neither the Shares the Warrant, nor the Warrant
Shares have been registered under the Securities Act, but that the Shares and
the Warrant have been issued, and the Warrant Shares shall be issued, if at all,
by the Corporation in reliance on an exemption contained in Regulation S
promulgated under the Securities Act ("Regulation S"'), and that the Corporation
is relying upon the truth and accuracy of the representations, warranties,
agreements, acknowledgments and understandings of the Investor set forth herein
in order to determine the applicability of such exemptions and the Investor's
suitability to acquire the Shares, the Warrant and the Warrant Shares.

                           4.9.2    Non-U.S. Person.

                                    4.9.2.1 Definition.  For  purposes  of  this
Agreement, a "U.S. person" shall include, without limitation, any natural person
resident in the United States, any partnership or corporation organized or
incorporated under the Laws of the United States (other than certain branches of
non-U.S. banks or insurance companies), any estate of which any executor or
administrator is a U.S. person or any trust of which any trustee is a U.S.
person (with certain exceptions) and any agency or branch of a foreign entity
located in the United States, but does not include a natural person not resident
in the United States. The "United States"' means the United States of America,
its territories and possessions, any state of the United States and the District
of Columbia.

                                    4.9.2.2 Representations  and  Warranties  as
to "U.S. Person". The Investor is not, and at the time of the Closing and/or the
exercise of the Warrant (or any part thereof) will not be, a "U.S. Person". The
Investor is not, and at the time of the Closing and/or the exercise of the
Warrant (or any part thereof) will not be, acquiring the Shares or Warrant
Shares, as the case may be, for the benefit of any U.S. Person. Upon the
Closing, the Investor will be the sole beneficial owner of the Shares, and upon
exercise of the Warrant (or any part thereof), if at all, the Investor will be
the sole beneficial owner of the Warrant Shares, and the Investor has not
pre-arranged any sale with respect to any of the foregoing to any purchaser or
purchasers in the United States.

                           4.9.3    Outside  the U.S.  The  Investor  is outside
the United States as of the date of the execution and delivery of this Agreement
and will be outside the United States at the time of the Closing and, if
applicable, at the time of exercise of the Warrant or any part thereof; provided
however that delivery of the Common Stock may be effected within the United
States through the Investor's agent as long as the Investor is outside the
United States at the time of any such delivery.

                           4.9.4    Limitation  on  Resale  &  Transferability.
The Investor understands that the Shares, the Warrant, and/or the Warrant Shares
cannot be offered for sale, sold or otherwise transferred unless pursuant to
registration under the Securities Act or pursuant to an available exemption from
registration under the Securities Act, including without limitation Regulation S
promulgated thereunder. The Investor has no present intention to sell or
otherwise transfer the Shares or the Warrant or any Warrant Shares that may be
acquired hereinafter except in accordance with the provisions of Regulation S of
the Securities Act, pursuant to registration under the Securities Act, or
pursuant to an available exemption from registration under the Securities Act.
The Investor understands that the Corporation is required, under Rule 903 of
Regulation S, to refuse to register the transfer of any of the Shares, the
Warrant or any of the warrant Shares that are not transferred pursuant to a
registration statement under the Securities Act, in compliance with Regulation S
under the Securities Act, or otherwise pursuant to an available exemption from
registration.

                           4.9.5    No  Short  Position.  The  Investor
covenants that it will not, directly or indirectly, or through one or more
intermediaries, maintain any "short" position (as hereinafter defined) in the
Common Stock during the "Distribution Compliance Period" (as hereinafter
defined). For purposes hereof, a "short position" shall mean any sale of a
security which the seller does not own or any sale which is consummated by the
delivery of a security borrowed by, or for the account of, the seller. For
purposes hereof, the "Distribution Compliance Period" shall mean the date which
is twelve months from the date of issuance.

                           4.9.6    No  Hedging  Transactions.  The  Investor
hereby agrees not to engage in any hedging transactions with regard to the
Common Stock, unless in express compliance with the provisions of Regulation S,
pursuant to registration under the Securities Act or pursuant to an exemption
from the registration requirements of the Securities Act.

                                    SECTION 5
                       REPRESENTATIONS OF THE CORPORATION

                  The Corporation represents and warrants to the Investor as
follows:

                  5.1      Due Authorization.        The  Corporation  has the
complete power to execute and deliver this Agreement, and consummate all of the
transactions contemplated hereby. The Agreement constitutes the valid and
legally binding obligations of the Corporation, enforceable against the
Corporation in accordance with its terms.

                  5.2 No Violation. Neither the execution, delivery nor
consummation of this Agreement by the Corporation, will, with the passage of
time, the giving of notice, or otherwise, result in a violation or breach of, or
constitute a default under, any term or provision of any law, rule, regulation,
order, decree, judgment, indenture, mortgage, deed of trust, lease, instrument,
contact, agreement or other restriction to which the Corporation is a party or
to which the Corporation, or the Corporation's' property is subject or bound.

                  5.3 Shares. The Shares and the Warrant, when issued, sold and
delivered in accordance with the terms hereof, for the consideration expressed
herein, will be validly issued, fully paid and nonassessable and, based in part
upon the representations of Investor in this Agreement, will be issued in
compliance with all applicable U.S. federal and state securities laws. The
Warrant Shares, when issued in accordance with the terms of the Warrant, shall
be duly and validly issued and outstanding, fully paid and nonassessable, and
based in part on the representations and warranties of Investor, will be issued
in compliance with all applicable U.S. federal and state securities laws.

                 5.4 Defaults. The Corporation is not in violation of or default
under, nor will the execution and delivery of this Agreement, the issuance of
the Shares, the Warrant or (to the extent all or any part of the warrant is
exercised) any of the Warrant Shares result in a violation of, or constitute a
default under, its certificate of incorporation or by-laws, any material
agreements or any material covenants or conditions contained in any bond,
debenture, note or other evidence of indebtedness, contract, indenture,
mortgage, loan agreement, lease, joint venture, or other agreement or instrument
to which the Corporation is a party or by which it or any of its properties may
be bound or in violation of any material order, rule, regulation, writ,
injunction, or decree of any government, governmental instrumentality, or court,
domestic or foreign.

                                    SECTION 6
                             REGISTRATION OF SHARES

The Corporation shall use its reasonable best efforts to file, at its sole
expense, a resale registration statement on Form SB-2, or other applicable form,
with the U.S. Securities and Exchange Commission (the "Commission") covering all
of the Shares no later than January 31, 2002. The Corporation shall use its
reasonable best efforts to cause such registration statement to be declared
effective in a reasonably timely manner by the Commission.





                                    SECTION 7
                                   PUT OPTION

                  7.1 Put Option. Investor shall have a right and option (the
"Put Option"), exercisable by notice to the Corporation at any time during the
period commencing upon 12:00 A.M E.S.T. on December 31, 2003 and continuing
thereafter until 5:00 P.M. E.S.T on June 30, 2004, to require the Corporation to
purchase up to two million five hundred thousand (2,500,000) of the Shares which
it then holds (the "Put Shares") for a cash purchase price of $0.20 per share.
Upon the issuance thereof, the certificates reflecting the Put Shares shall bear
a legend referencing the Put Option. The Put Option shall not be assignable to
any assignee of a the Put Shares. Notwithstanding the foregoing, the Put Option
shall automatically inure to the benefit of any Qualified Assignee with respect
to any Put Shares transferred to such Qualified Assignee. As used herein, a
"Qualified Assignee" shall mean any assignee in a private transfer of Put Shares
by Investor in compliance with the Securities Act of 1933 or an exemption
therefrom to (i) an affiliate (as defined in Rule 405 under the Securities Act
of 1933, as amended) of such Seller or (ii) any partner, shareholder or other
equity owner of Investor.

                  7.2      General  Provisions  of Put Option.  The following
provisions shall govern the closing (a "Put Closing") of the purchase by the
Corporation of any Put Shares pursuant to an exercise of the Put Option;

(i)           The Put Closing shall be held (i) at 10:00 am local time at the
              Corporation's offices on the forty-fifth (45th) business day
              following written notice of exercise of the Put Option;

(ii)        At the Put Closing,  the Corporation  and Investor (or its Qualified

               Assignee) shall be obligated to execute and deliver the
               following: (A) the Corporation shall deliver to Investor (or its
               Qualified Assignee), in immediately available funds, the total
               purchase price (as determined in accordance with the provisions
               contained in subsection (iii) of this subsection 7.2 for the Put
               Shares being purchased, (B) Investor or its Qualified Assignees
               shall execute and deliver to the Corporation (i) the certificates
               representing the Put Shares being purchased by the Corporation
               endorsed for transfer to the Corporation, free of all liens,
               claims and encumbrances and (ii) such other instruments of
               assignment, certificates of authority, tax releases, consents to
               transfer and instruments in evidence of title as may be
               reasonably required by the Corporation; and

(iii)         The per share purchase price payable upon the exercise of any Put
              Option as provided for herein shall hereafter be adjusted as may
              be necessary to reflect any stock dividends or corporate
              recapitalizations after the date hereof resulting in stock splits,
              combinations or exchanges of shares or any similar transactions.

         7.3 Early Termination of the Put Option. Notwithstanding anything to
the contrary contained herein, the Put Option shall automatically terminate
prior to its term expiration upon the occurrence of either of the following
events: (i) the consummation of an underwritten public offering of shares of the
Common Stock at an offering price per share not less than $0.40 and an aggregate
offering price of $2,000,000, or (ii) the consummation of a merger or other
business combination pursuant to which the Common Stock is valued at a price not
less than $0.40 per share and pursuant to which liquidity in respect of the
Shares and any Warrant Shares held at such time by the Investor is made
available to the Investor; provided, however, that the Investor is provided with
reasonable advance notice of any such planned occurrence and is given a
reasonable opportunity to take any steps that may be required to participate.

                                    SECTION 8
                                  MISCELLANEOUS

                  8.1 Expenses. All legal and other costs and expenses incurred
in connection with the negotiation and execution of the Agreements, and the
consummation of the transactions contemplated hereby shall be paid by the party
incurring such expenses.

                  8.2 No Assignment. This Agreement shall be binding upon the
parties, their successors and legal representatives. Except as specifically set
forth herein, this Agreement shall not be assigned by either party without the
prior written consent of the other. No permitted assignment shall relieve the
assignor of its obligations hereunder.

                  8.3 Notices. All notices and other communications hereunder
shall be given in writing and shall be deemed given when delivered personally,
or on the first attempted date of delivery after being mailed by certified or
registered mail, return receipt requested, to the parties at the addresses set
forth at the beginning of this Agreement or at such other address for a party as
shall be specified by like notice, and in the case of the Corporation with a
copy to:

                                    Membrado Montell, LLP
                                    535 West 34th Street, 2nd Floor
                                    New York, New York  10001
                                    Attn:  R. Scott Montell, Esq.

                  8.4 Counterparts. This Agreement may be executed in two or
more counterparts for the convenience of the parties hereto, each of which
executed counterparts shall be deemed an original but all of such executed
counterparts shall be considered one and the same agreement.

                  8.5 Controversy. In the event of any controversy or dispute
hereunder, the parties agree to submit the same to the courts of the State of
New York or the United States of America, sitting in the State of New York,
County of New York, and each hereby expressly submits himself or itself to the
personal jurisdiction of such courts. Each party also agrees that service of
process may be accomplished upon it or him in the same manner as the giving of
notice hereunder.

                  8.6 Severability. If any provision of this Agreement shall be
found to be unenforceable, the validity of this Agreement shall not be affected
thereby and the remaining provisions shall, as near as possible, be construed as
if such unenforceable provision was not a part of this Agreement.

                  8.7 General. This Agreement supersedes all prior agreements
between the parties, whether written or oral, and is intended as a complete and
exclusive statement of the terms of the agreements between the parties with
respect to the subject matter covered hereby and may not be changed or
terminated orally but only in a writing signed by the parties. The headings and
captions contained in this Agreement are for reference purposes only and shall
not affect, in any way, the meaning or interpretation of this Agreement. Nothing
in this Agreement, whether expressed or implied, is intended to confer upon any
other person not a party to this Agreement any rights or remedies under or by
reason of this Agreement. This Agreement has been entered into and is to be
governed by the laws of the State of New York, without regard to principles of
conflicts of laws.


         IN WITNESS WHEREOF, the parties have executed, or have caused to be
executed this Agreement as of the date first above written.

                                      SAVE ON ENERGY, INC.



                                      By:   /s/ Robert Stiles
                                         ---------------------
                                      Name:    Robert Stiles
                                      Title:    President


                                      SWI HOLDINGS, LIMITED


                                      By:   /s/ Wolfgang Wacker
                                         ----------------------
                                         Name:  Wolfgang Wacker
                                         Title:    Vice President


<PAGE>


                                  EXHIBIT 10.2
                               SECURITY AGREEMENT

         SECURITY AGREEMENT (this "Agreement"), made as of the 10th day of
December, 2001, by and between SAVE ON ENERGY, INC., a Georgia corporation
("Save") and SWI HOLDINGS, LIMITED, a Bermuda corporation ("SWI")(Save and SWI
may hereinafter be referred to individually as a "Party" or collectively as the
"Parties").

         WHEREAS, pursuant to a certain Stock Purchase Agreement (the "Stock
Purchase Agreement") dated December 10, 2001, by and between Save and SWI, Save
granted to SWI a certain option pursuant to which 2,500,000 common shares (the
"Put Shares") of Save could be put to Save at a purchase price of $0.20 per
share (the "Put Option"); and

         WHEREAS, it is a condition to the consummation of the transactions
contemplated under the Stock Purchase Agreement that the financial obligation of
Save underlying the Put Option be secured by (i) a first priority, senior lien
and security interest in all of the assets, tangible and intangible, of Save,
except for the assets of Alternative Energy, Inc., a New York corporation and a
wholly-owned subsidiary of Save ("AET"), and (ii) a second priority lien and
security interest in all of the assets, tangible and intangible, of AET,
subordinate only to the first priority lien on such assets held by New York
State Electric & Gas Corporation ("NYSEG").

                  NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:

         1.       Definitions.

                  (a)      The term  "Obligations"  shall mean any and all
obligations  of Save arising  under the Put Option.

                  (b) The term "Collateral" shall mean any and all tangible and
intangible assets in which Save and/or AET has or shall have an interest, now or
hereafter existing or acquired, and wherever located, together with all
additions and accessions thereto and replacements and substitutions thereof and
all proceeds and products of the foregoing.


<PAGE>




                  (c) All other terms used herein which are not otherwise
defined herein and are defined in the Uniform Commercial Code of the State of
New York, or any state where Save and/or AET's assets are located, as applicable
(collectively, the "UCC"), shall have the meanings therein stated.

         2. Grant of Security Interest. Save hereby grants to SWI (i) a valid
and binding first priority, senior lien and security interest in all of the
assets, tangible and intangible, of Save, except for (a) the assets of AET and
(b) the assets with respect to which Save has granted a security interest to
Peachtree National Bank ("Peachtree") pursuant to that certain loan agreement
between Peachtree and Save and (c) that certain 2000 International Chevrolet
truck with respect to which Save has granted a security interest to The
Associates Commercial Corporation, and (ii) a valid and binding second priority
lien and security interest in (a) all of the assets, tangible and intangible, of
AET, and (b) all of the assets set forth in clauses (i)(a) and (i)(b) above,
subordinate only to the first priority liens on such assets granted by Save (the
"Security Interest") as security for the payment, performance, and observance by
Save of its obligation to purchase the Put Shares for an aggregate purchase
price of up to $500,000.

         3.       Representations and Warranties.  Save represents and warrants
to SWI as follows:



<PAGE>


                  (a) Authority. The execution and delivery by Save of this
Agreement, and each of the other documents relating hereto (collectively with
this Agreement, the "Security Documents") and the performance of Save's
obligations hereunder and thereunder: (i) are within Save's corporate powers;
(ii) are duly authorized by Save's Board of Directors and stockholders, if
required; (iii) are not in contravention of the terms of Save's Certificate of
Incorporation or By-laws, or of any indenture, agreement or undertaking to which
Save is a party or by which Save or any of its assets or property is bound or
affected; (iv) do not, as of the date of execution hereof, require the consent,
approval or authorization of or declaration, registration or filing with any
governmental body or any nongovernmental person or entity (except for the filing
of the UCC-1 and other financing statements and/or this Agreement contemplated
hereby; (v) do not contravene any contractual or governmental restriction
binding upon Save; and (vi) will not, except as contemplated herein, result in
the imposition of any liens, security interests or encumbrances of any nature
whatsoever (collectively, "Liens") upon any assets or property of Save under any
existing indenture, mortgage, deed of trust, loan or credit agreement or other
agreement or instrument to which Save is a party or by which it or any of its
assets or property may be bound or affected.

                  (b) Binding Effect. The Security Documents have been duly
executed and delivered on behalf of Save and constitute the legal, valid and
binding obligations of Save enforceable against Save in accordance with their
terms.

                  (c) Full Disclosure. No representation or warranty in this
Agreement contains, or will contain, any untrue statement of any material fact
as of the date when made or omits, or will omit, to state any material fact as
of the date when made or omits, or will omit, to state any material fact
necessary to make the statements herein or therein not misleading as of the date
when made; there is no fact known to Save that has not been disclosed to SWI in
writing which materially and adversely affects or would materially and adversely
affect the business, financial condition or operations of Save.

         4.       Affirmative  Covenants.  From and  after the date  hereof  and
continuing  so long as any of the Obligations shall remain unpaid, unless SWI
shall otherwise consent in advance and in writing:

                  (a)      Perfection of Security Interest.

                           (i)      Save will, from time to time, do whatever
SWI may reasonably request by way of obtaining, executing, delivering and/or
filing financing statements, copyright mortgages, patent collateral assignments
and the like, and other notices and amendments and renewals thereof, and will
take any and all steps and observe such formalities as SWI may request, in order
to create, perfect and maintain valid continuing Liens upon the Collateral
consistent with the Security Interest and as contemplated by this Agreement.



<PAGE>


                           (ii)     Save hereby irrevocably appoints SWI as its
lawful attorney-in-fact and agent, with full power of substitution, to execute
and deliver, on behalf of and in the name of Save, such financing statements,
assignments, notices, pledges and other documents and agreements, and to take
such other actions as SWI may deem reasonably necessary for the purpose of the
creation, perfection, maintenance or continuation of the Security Interest,
under any applicable law, and SWI is hereby authorized to file on behalf of and
in the name of Save, at Save's expense, such financing statements, assignments,
notices, pledges and other documents and agreements in any appropriate
governmental office. The right is expressly granted to SWI, in its discretion,
in those jurisdictions where the same is permitted, to file one or more
financing statements (including amendments and renewals thereof) under the UCC
or similar law or under federal and/or foreign patent, copyright and/or
trademark law signed only by SWI, naming Save as debtor and naming SWI as
secured party and indicating therein the types, or describing the items, of the
Collateral. This power of attorney is coupled with an interest and irrevocable
while any of the Obligations shall remain unpaid.

                  (b)      Tax Obligations.

                           (i)      Save shall file all tax and  information
returns and reports required by all applicable taxing authorities (all prepared
in accordance with applicable law), pay or cause to be paid all license fees and
related taxes and charges, and pay or cause to be paid all income, employment,
real and personal property taxes and other governmental taxes and charges
assessed against Save, or payable by Save, at such times and in such manner as
to prevent any penalty or interest from accruing thereon, or any Lien or charge
from attaching to the Collateral; provided that Save shall have the right to
contest any such fees, premiums, taxes and charges prior to the payment thereof
for so long as such contest is pursued diligently and in good faith by
appropriate proceedings.

                           (ii)     Save shall notify SWI  promptly  (and in no
event later than fifteen (15) days) after becoming aware of the intent of the
Internal Revenue Service or other taxing authority (the "Taxing Authority") to
assert a deficiency with respect to it, and shall promptly (and in no event
later than fifteen (15) days following receipt of any notice of deficiency)
inform SWI of such proposed deficiency and deliver to SWI a copy of any notices
of deficiency received from the Taxing Authority. If SWI so requests, and if
there is a reasonable legal basis therefor, Save shall take all reasonable
actions necessary to contest such claimed deficiency and shall appoint outside
tax counsel reasonably acceptable to SWI to contest such claims of deficiency
and shall direct such counsel to consult with and to provide SWI with periodic
status reports and assessments of the legal merits of the contest. At SWI's
request, such contest shall continue through the appropriate administrative and
court procedures, including appeals therefrom, until such outside tax counsel
informs Save that further contest would be inadvisable taking into account all
factors (including any settlement or compromise proposed by the Taxing
Authority).



<PAGE>


                  (c) Further Assurances. Save shall at any time or from time to
time execute and deliver such further instruments and documents and take such
further action as may reasonably be requested by SWI to carry out, to SWI's
reasonable satisfaction, the transactions contemplated by Security Documents.

                  (d) Indemnification. Save shall indemnify, defend and hold
harmless SWI and its officers, directors, agents and employees from and against
all losses, costs, fines, liabilities, judgments, actions, penalties, damages,
injuries, claims, demands, disbursements and expenses, including reasonable
attorneys' fees and costs, arising out of (i) the execution or consummation of
this Agreement and the other Security Documents; (ii) the operation or
maintenance of any of the Collateral; or (iii) any aspect of, or any transaction
contemplated by or referred to in, or any matter related to, this Agreement, in
each case whether or not Save or such holder is a party thereto, except to the
extent such losses, cost, fines, liabilities, judgments, actions, penalties,
damages, injuries, claims, demands, disbursements and expenses are directly
caused by the gross negligence or willful misconduct of SWI or such holder or
their respective agents, servants or employees. Save shall assume the settlement
and defense of any suit or other legal proceeding brought to enforce any of the
foregoing (with counsel reasonably satisfactory to SWI), and shall pay all
judgments entered in any such suit or legal proceeding. Save shall not
compromise or settle any such suit or other legal proceeding without the prior
written consent of SWI, which consent shall not be unreasonably withheld or
unduly delayed. The indemnities and assumptions of liabilities and obligations
herein provided for shall continue in full force and effect notwithstanding the
termination of this Agreement.

         5.       Negative  Covenants.  From  and  after  the date  hereof,  and
continuing  so long as any of the Obligations shall remain unpaid, unless SWI
shall otherwise consent in advance and in writing:

                  (a) Liens. Save will not create or suffer to exist any Lien
upon or with respect to the Collateral which is superior in rank to the Lien
created hereby, except Liens in favor of SWI.

                  (b) Amendments. Save will not request, permit or consent to
any amendment to its Certificate of Incorporation, By-Laws or other
organizational documents, which amendment could have a material adverse effect
on the Security Interest or otherwise on SWI in its capacity as a secured party
under this Agreement.



<PAGE>


         6. Inspection and Audit. From and after the date hereof, and continuing
so long as any of the Obligations shall remain unpaid, Save will permit SWI, or
any person designated by SWI in writing, from time to time hereafter, to enter
Save's place or places of business (or any other place where the Collateral or
any information relating thereto is kept or located) during all business hours
upon not less than three (3) business days' prior notice, and, without hindrance
or delay (provided that SWI or such designees shall not unreasonably disrupt the
day-to-day operations of Save), (i) to inspect, audit, check and make copies of
and extracts from Save's books, records, journals, orders, receipts and any
correspondence and other data relating to the Collateral, the Security Interest
and the Security Documents to an extent within its own discretion, (ii) to take
such steps as Save deems reasonably necessary to verify the accuracy and
completeness of the foreoing, and (iii) to reasonably discuss any issues
relating thereto with any of SWI's officers, directors or outside auditors.
SouthWest will treat and hold as any confidential information it receives in the
course of the reviews contemplated by this Section 6, will not use any of the
confidential information except in connection with this Agreement, and, if this
Agreement is terminated for any reason whatsoever, will return to Save all
tangible embodiments (and all copies) of the confidential information which are
in its possession.

         7. Remedies on Default. Upon the occurrence of any one or more defaults
in Save's payment obligations pursuant to the Put Option, SWI shall have the
following rights and remedies in addition to all rights and remedies of a
secured party under the UCC, federal and/or foreign patent, copyright and/or
trademark law or other applicable statute or rule, in any jurisdiction in which
enforcement is sought, all such rights and remedies being cumulative and not
exclusive:

                  (a) Collateral. (i) SWI may at any time and from time to time,
with or (if and to the extent permitted by applicable law) without process of
law and with or (if and to the extent permitted by applicable law) without the
aid and assistance of others, enter upon any premises in which the Collateral or
any part thereof may be located and, without resistance or interference by Save,
take or otherwise put itself in possession of the Collateral; and/or dispose of
all or any part of the Collateral located on any premises of Save or its agents;
and/or require Save to assemble and make available to SWI all or any part of the
Collateral at any place and time reasonably designated by SWI; and/or remove all
or any part of the Collateral from any premises on which any part thereof may be
located for the purpose of effecting preservation or sale or other disposition
thereof; and/or sell, resell, lease, assign and deliver, or otherwise dispose in
good faith of, the Collateral or any part thereof in its existing condition on
commercially reasonable terms or following any commercially reasonable
preparation or processing, at public or private proceedings, in one or more
parcels at the same or different times with or without having the Collateral at
the place of sale or other disposition, for cash, upon credit or for future
delivery, and in connection therewith SWI may grant options, at such place or
places and time or times and to such persons, firms or corporations on
commercially reasonable terms as SWI deems appropriate, and without demand for
performance, and/or liquidate or dispose of the Collateral or any part thereof
in any other commercially reasonable manner. Provided notice has been given in
accordance herewith, failure of Save to contest within a reasonable period on
the grounds of commercial reasonability shall be deemed a waiver of said
defense.
                           (ii) If any of the  Collateral  is sold by SWI upon
credit or for future delivery, SWI shall not be liable for the failure of the
purchaser to pay for the same and, in the event of any such failure, SWI may, in
accordance with any applicable credit or related agreements, resell such
Collateral. SWI may buy any part or all of the Collateral at any public sale
and, if any part of the Collateral is of a type which is the subject of widely
distributed standard price quotations, SWI may buy at a private sale, all free
from any equity or right of redemption, which is hereby waived and released by
Save, and SWI may make payment therefor (by endorsement without recourse) in
notes of SWI.

                           (iii)  SWI may  apply  the  cash  proceeds  actually
received from any sale or other disposition of the Collateral in accordance
herewith to the reasonable expenses of retaking, holding, preparing for sale,
selling, leasing and the like, reasonable legal fees and expenses, court costs,
collection charges, travel and other expenses which may be incurred by SWI in
attempting to collect the Obligations or to enforce this Agreement and realize
proceeds upon conversion of the Collateral, or in the prosecution or defense of
any action or proceeding related to the subject matter of this Agreement; and
then to the Obligations in such order as to principal and/or interest due as SWI
may in its sole reasonable discretion determine; and Save shall at all times be
and remain liable and, after crediting the net proceeds of sale or other
disposition as aforesaid, will pay SWI on demand any deficiency remaining,
including interest thereon and the balance of any expenses at any time unpaid,
with any surplus to be paid to Save, subject to any duty of SWI to the holder of
any subordinate security interest in the Collateral known to SWI, but only to
the extent required by law.

                  (b) Proceeds. Any of the proceeds of the Collateral received
by Save shall not be commingled with other property of Save, but shall be
segregated, held by Save in trust for SWI as the exclusive property of SWI, and
Save will immediately deliver to SWI the identical checks, moneys or other
proceeds of Collateral received, and SWI shall have the right to endorse the
name of Save on any and all checks, or other forms of remittance received, where
such endorsement is required to effect collection. Save hereby designates,
constitutes and appoints SWI and any designee or agent of SWI as
attorney-in-fact of Save, irrevocably and with power of substitution, to endorse
the name of Save on any notes, acceptances, checks, drafts, money orders or
other evidences of payment or proceeds of the Collateral that may come into
SWI's possession; to sign the name of Save on any invoices, documents, drafts
against account debtors of Save, assignments, requests for verification of
accounts and notices to debtors of Save; to execute any endorsements,
assignments, or other instruments of conveyance or transfer; and to do all other
acts and things necessary and advisable in the sole discretion of SWI to carry
out and enforce this Agreement. Said attorney or designee shall not be liable
for any acts or commission or omission nor for any error of judgment or mistake
of fact or law. This power of attorney is coupled with an interest and
irrevocable while any of the Obligations shall remain unpaid.



<PAGE>


         8. Liability Disclaimer. Except for reasonable care of Collateral in
its possession, if any, under no circumstances whatsoever shall SWI be deemed to
assume any responsibility for, or obligation or duty with respect to, any part
or all of the Collateral, of any nature or kind whatsoever, or any matter or
proceeding arising out of or relating thereto. SWI shall not be required to take
any action of any kind to collect or protect any interest in the Collateral,
including, but not limited to, any action necessary to preserve its or Save's
rights against prior parties to any of the Collateral. SWI shall not be liable
or responsible in any way for the safekeeping, care or custody of any of the
Collateral (except for reasonable care of Collateral in its possession), or for
any loss or damage thereto, or for any diminution in the value thereof, or for
any act or default of any agent or bailee of SWI or Save, or of any carrier,
forwarding agency or other person whomsoever, or for the collection of any
proceeds, but the same shall be at Save's sole risk at all times. Save hereby
releases SWI from any claims, causes of action and demands at any time arising
out of or with respect to this Agreement or the Obligations, and any actions
taken or omitted to be taken by SWI with respect thereto, except for such
claims, causes of action, demands and/or actions directly caused by SWI's gross
negligence or willful misconduct, and Save agrees to defend and hold SWI
harmless from and with respect to any and all such claims, causes of action and
demands, except for such claims, causes of action, demands and/or actions
directly caused by SWI's gross negligence or willful misconduct. SWI's prior
recourse to any part or all of the Collateral shall not constitute a condition
of any demand for payment of the Obligations or of any suit or other proceeding
for the collection of the Obligations.

         9. Nonwaiver. No failure or delay on the part of SWI in exercising any
of its rights and remedies hereunder or otherwise shall constitute a waiver
thereof, and no single or partial waiver by SWI of any default or other right or
remedy which it may have shall operate as a waiver of any other default, right
or remedy or of the same default, right or remedy on a future occasion.

         10. Waivers. Save hereby waives presentment, notice of dishonor and
protest of all instruments included in or evidencing any of the Obligations or
the Collateral and any and all other notices and demands whatsoever (except as
expressly provided herein) whether or not relating to such instruments. In the
event of any litigation at any time arising with respect to any matter connected
with this Agreement or the Obligations, Save hereby waives the right to a trial
by jury and Save hereby waives any and all rights of setoff and rights to
interpose counterclaims of any nature except for counterclaims which are
compulsory or which would be lost for failure to be raised.

         11.      Binding  Effect.  This Agreement and all  Obligations of Save
hereunder shall be binding upon the successors or assigns of Save, and shall,
together with the rights and remedies of SWI hereunder, inure to the benefit of
SWI and its successors, endorsees and assigns.

         12. Application of Payments. In addition to its other rights herein,
SWI shall have the continuing and exclusive right to apply or reverse and
reapply any and all payments to any portion of the Obligations. To the extent
that Save makes a payment or payments to SWI or SWI receives any payment or
proceeds of any security for such Obligations for Save's benefit, which
payment(s) or proceeds or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, state
or federal law, common law or equitable cause, then, to the extent of such
payment or proceeds received, the Obligations or part thereof intended to be
satisfied shall be revived and continue in full force and effect, as if such
payment or proceeds had not been received by SWI.



<PAGE>



         13. Consent to Jurisdiction. Save agrees that (i) any state or federal
court within the State of New York shall have personal jurisdiction over Save,
and (ii) service of any summons and complaint or other process in any such
action or proceeding may be made by registered or certified mail directed to
Save at Save's address set forth below, and service so made shall be deemed to
be completed upon the earlier of actual receipt or three (3) days after the same
shall have been posted as aforesaid, Save hereby waiving personal service
thereof. Nothing in this paragraph shall affect the right of SWI to serve legal
process in any other manner permitted by law or affect the right of SWI to bring
any action or proceeding against Save or its property in the courts of any other
jurisdiction. Save and SWI agree that any claim or suit between or among the
parties hereto involving this Agreement, any of the other Security Documents or
any transactions contemplated hereby or thereby shall be brought in and decided
by the state or federal courts located in New York County, New York.

         14. Entire Agreement. This Agreement and the schedules attached hereto
constitutes the entire agreement of the parties with respect to the subject
matter hereof and there are no representations, warranties or commitments except
as set forth herein. This Agreement supersedes all prior agreements,
understandings, negotiations and discussions, whether written or oral, of the
parties hereto relating to the matters set forth in this Agreement. The
representations, warranties, covenants and agreements set forth in this
Agreement constitute all the representations, warranties, covenants and
agreements of the parties and upon which the parties have relied, shall not be
deemed waived or otherwise affected by any investigation made by any party
hereto and, except as may be specifically provided herein, no change,
modification, amendment, addition or termination of this Agreement or any part
thereof shall be valid unless in writing and signed by or on behalf of the party
to be charged therewith.

         15. Notices. Any and all notices or other communications or deliveries
required or permitted to be given or made pursuant to any of the provisions of
this Agreement shall be in writing and shall be deemed to have been duly given
or made for all purposes when hand delivered or sent by certified or registered
mail, return receipt requested and postage prepaid, overnight mail or courier,
or telecopier to the addresses set forth in the Asset Purchase Agreement or at
such other address as any party may specify by notice given to the other party
in accordance with this paragraph 15.

         16. Choice of Law; Severability. This Agreement shall be governed by,
and interpreted and construed in accordance with, the laws of the State of New
York applicable to agreements performed wholly within such state. In the event
any clause, section or part of this Agreement shall be held or declared to be
void, illegal or invalid for any reason, all other clauses, sections or parts of
this Agreement which can be effected without such void, illegal or invalid
clause, section or part shall nevertheless continue in full force and effect.

         17.      Headings.  The section  headings of this Agreement are for
convenience and reference only and do not in any way modify, interpret or
construe the intent of the parties or affect any of the provisions of this
Agreement.

                  IN WITNESS  WHEREOF,  the  undersigned  have executed this
Agreement as of the date first written above.

                                            SAVE ON ENERGY, INC.
                                            A Georgia Corporation

                                            By:  /s/ Robert Stiles
                                               --------------------
                                              Name:  Robert Stiles
                                              Title:    President


                                            SWI HOLDINGS, LIMITED
                                            A Bermuda Corporation


                                            By:   /s/ Wolfgang Wacker
                                               ----------------------
                                                Name: Wolfgang Wacker
                                                Title: Vice President

<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

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

                                    FORM 8-K

                                 CURRENT REPORT
                       PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

       Date of Report (Date of earliest event reported) December 10, 2001

                              SAVE ON ENERGY, INC.
             (Exact Name of Registrant as Specified in its Charter)

             Georgia                     333-33134            58-2267238
  (State or Other Jurisdiction          (Commission        (I.R.S. Employer
        of Incorporation)                 File No.)       Identification No.)

                       4851 Georgia Highway 85, Suite 211,
                           Forest Park, Georgia 30050
          (Address, including zip code, of principal executive offices)

       Registrant's telephone number, including area code: (404) 765-0131

                                    No Change
          (Former Name or Former Address, if Changed Since Last Report)
ITEM 2.  ACQUISITION OR DISPOSITION OF ASSETS

On December 11, 2001, Save On Energy, Inc. (the "Company"), through its
wholly-owned subsidiary, Alternative Energy Technologies, Inc. ("AET"),
completed the acquisition of certain assets of New York State Electric & Gas
Corporation ("NYSEG"). The acquisition included substantially all of NYSEG's
assets relating to its natural gas vehicle service, maintenance and construction
business. Simultaneously with the closing of the acquisition, the Company
entered into a Service Agreement with NYSEG pursuant to which, among other
things, the Company has agreed to maintain NYSEG's natural gas refueling
facilities for a period of four years. Robert Stiles, the Company's President,
formerly served as the Manager of NYSEG's Alternative Fuel Vehicle Market
Development division. The new company will continue to provide customers with
heavy duty vehicle natural gas conversion equipment, facility and equipment
maintenance, training, consulting, and infrastructure design construction
services.

The aggregate purchase price for these assets was approximately $300,000, of
which, $70,000 in cash was paid at the closing with the balance payable in
quarterly installments through March 31, 2003. AET's obligation to make such
payments is secured by a first priority lien in favor of NYSEG on all of AET's
assets and is guaranteed by the Company.

The foregoing description of the transaction is qualified in its entirety by
reference to the Asset Purchase Agreement and related documents, which are filed
herewith as exhibits.

ITEM 5.     OTHER EVENTS

Private Placement of Securities

On December 10, 2001, the Company completed its private placement of 2.6 million
shares of common stock to SWI Holdings, Limited ("SWI"), a Bermuda company, for
an aggregate purchase price of $500,000. To date, SWI has paid $300,000 of the
purchase price with the balance due on or before January 15, 2002. Pursuant to
the Company's Stock Purchase Agreement with SWI, SWI has the right during the
period between December 31, 2003 and June 30, 2004 to require the Company to
purchase up to 2.5 million of these shares at a price of $0.20 per share (the
"Put Option"). The Put Option will automatically terminate in the event that the
Company (i) completes a financing of in excess of in excess of $2.0 million in
gross proceeds at an offering price per share of not less than $0.40 or (ii)
completes a merger or other business combination pursuant to which the common
stock is valued at a price per share of not less than $0.40. The Company's
obligations under the Put Right are secured by a lien in favor of SWI on all of
the Company's assets.

In connection with the private placement, the Company issued a three-year
warrant to SWI. The warrant provides SWI the right to acquire up to 250,000
shares of the Company's common stock at an exercise price of $0.50 per share.

The Company has also agreed to use its reasonable best efforts to file a
registration statement covering the resale of the shares issued in the private
placement on or before January 31, 2002.

The foregoing description of the transaction is qualified in its entirety by
reference to the Stock Purchase Agreement and Security Agreement, which are
filed herewith as exhibits.

Appointment of Board Members

On December 12, 2001, the Board of Directors appointed Wolfgang Wacker and Greg
Erwin to fill two vacancies on the Board. Messrs. Wacker and Erwin were elected
to serve on the Board at the Company's previous annual meeting, however, they
declined to accept such appointment until the Company obtained Directors and
Officers Insurance coverage. Mr. Wacker is also a shareholder and a Vice
President of SWI. Information regarding the business backgrounds of each of
Messrs. Wacker and Erwin can be found in the Company's Proxy Statement relating
to its 2001 Annual Meeting, which was filed with the SEC on October 1, 2001.

ITEM 7.  FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS

         (a) Financial Statements.

             It is impracticable to provide the required financial statements
for the acquired business at the time of this Report. Pursuant to Item 7(a)(4),
the registrant will file the required financial statements as soon as
practicable but not later than 60 days after the date of this Report.

         (b) Pro Forma Financial Information.

             It is impracticable to provide the required pro forma financial
information at the time of this Report. Pursuant to Item 7(b)(2), the registrant
will file the required pro forma financial information as soon as practicable
but not later than 60 days after the date of this Report.

         (c) Exhibits.

2.1 Asset Purchase  Agreement  between the Company and New York State Electric &
Gas Corporation, dated as of October 29, 2001.

2.2  Secured  Promissory  Note  in  favor  of  New  York  State  Electric  & Gas
Corporation, dated as of December 11, 2001.

2.3  Security  Agreement  between the Company and New York State  Electric & Gas
Corporation, dated as of December 11, 2001.

2.4  Guaranty  from  the  Company  in favor of New  York  State  Electric  & Gas
Corporation, dated as of December 11, 2001.

10.1 Stock  Purchase  Agreement  between the Company and SWI Holdings,  Limited,
dated as of December 10, 2001 (Composite Version).

10.2 Security Agreement between the Company and SWI Holdings,  Limited, dated as
of December 10, 2001
SIGNATURE

  Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

Date:  December 13, 2001

                                                SAVE ON ENERGY, INC.

                                                By:  /s/ Robert Stiles
                                                     -----------------
                                                  Name:  Robert Stiles
                                                  Title: President
EXHIBIT 2.1
                            ASSET PURCHASE AGREEMENT

         THIS ASSET PURCHASE AGREEMENT ("Agreement") is made as of this 29th
date of October, 2001 between NEW YORK STATE ELECTRIC & GAS CORPORATION, a New
York transportation corporation, having an address at Corporate Drive-Kirkwood
Industrial Park, PO Box 5224, Binghamton, New York 13902-5224 ("Purchaser") and
ALTERNATIVE ENERGY TECHNOLOGIES, INC., a New York corporation, having an office
at Airport Industrial Center, Suite 210, 4851 Georgia Highway 85, Forest Park,
Georgia 30297 ("Purchaser").

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency is hereby acknowledged, and in consideration of the recitals and the
respective covenants, representations, warranties and agreements herein
contained, and intending to be legally bound hereby, the parties hereto hereby
agree as follows:
         1.  Transfer of Assets.
                  1.1 Assets Conveyed. Upon the terms and subject to the
conditions set forth in this Agreement, Purchaser will purchase from Seller, and
Seller will sell, assign, transfer, convey and deliver to Purchaser at the
Closing ("Closing") on the Closing Date, as hereinafter defined, free and clear
of any and all claims, liens, pledges, options, security interests, conditional
sales agreements and encumbrances, whether voluntarily incurred or arising by
operation of law, all of Seller's right, title and interest in and to the
following assets of that natural gas vehicle sales and service business
("Business") currently operated by Seller at the NYSEG NGV Tech Center located
at 432 East Main Street, Endicott, New York 13760 (the "Premises"): (i) the
furniture and office supplies located on the Premises and certain computer
equipment listed on Exhibit D, attached hereto and made a part hereof, and
software owned by Seller and located on the Premises and in the home office of
Brenda Yuhas, an independent contractor of the Business who currently resides in
420 Bloombridge Way, Marietta, Georgia 30066 (collectively, "Office Equipment
and Supplies"); (ii) the equipment listed on Exhibit E, attached hereto and made
a part hereof (collectively, the "Equipment"); (iii) the two motor vehicles
described on Exhibit F, attached hereto and made a part hereof ("Motor
Vehicles"); (iv) the inventory and tanks substantially as listed on Exhibit G
located on the Premises or the Motor Vehicles as of the time of Closing
("Inventory"); (v) revenue and accounts receivable for service rendered and
goods shipped after 12:01 p.m. on the Closing Date; (vi) the "Pressure Plus"
trademark and the two logos in the form set forth on Exhibit H, attached hereto
and made a part hereof ("Business Identifiers"); (vii) any and all rights of
NYSEG in and to mobile natural gas compressor and home compressor technology as
described in Exhibit I ("Technology"); and (viii) any and all customer lists
relating to the Business (all of the foregoing described assets collectively
referred to hereinafter as the "Assets").
                  1.2 Exclusions. Those assets of the Business not expressly and
specifically described in Section 1.1 are excluded from the purchase and sale
effected by this Agreement, such excluded assets to include, without limitation,
the cash on hand; bank, savings or other accounts and items therein; the lease
of the Premises and all contracts associated with the Business (which shall be
terminated before the Closing); securities or instruments; insurance policies of
Seller and any rights or claims thereunder; revenue and accounts receivable for
goods shipped and services rendered before 12:01 p.m. on the Closing Date;
Seller's goodwill and any trade names, marks, logos or other commercial symbols
associated with Seller (not specifically included as Business Identifiers); and
any and all of Seller's books and records, provided however, that with Seller's
prior written approval, Purchaser may examine those books and records of Seller
that pertain to the operation of the Business to the extent necessary to conduct
a legitimate due diligence hereunder.
                  1.3 Assumed Liabilities. Notwithstanding anything to the
contrary contained herein, the Purchaser will not assume or have any
responsibility with respect to any obligation or of any kind or nature of the
Seller, fixed or unfixed, choate or inchoate, liquidated or unliquidated,
secured or unsecured, known or unknown, accrued, absolute, contingent or
otherwise.
         2.  Purchase Price.
                  2.1  Total  Purchase  Price.  The  total  "Purchase  Price"
shall  be the  sum  of  two  hundred eighty-five thousand dollars ($285,000.00).
                  2.2 Payment of Purchase Price. The total Purchase Price shall
be paid by wire transfer of funds to the account of Seller at Closing in
accordance with the written instructions provided to Purchaser by Seller within
two business days prior to Closing.
                  2.3 Allocation of Purchase Price. The Purchase Price shall be
allocated among the Assets acquired hereunder in accordance with Exhibit J
attached hereto. Seller and Purchaser each hereby covenants and agrees that it
will not take a position on any income tax return, before any governmental
agency charged with the collection of any income tax, or in any judicial
proceeding that is in any way inconsistent with the terms of this Section 2.4
and the allocation of the Purchase Price as determined by the Seller's Board of
Directors.
         3.  Prorations.  The  following  items  relating  to the  Assets  and
Business  shall be paid  through or prorated as of, the Closing Date:  None
         4. Utilities. The parties shall arrange for a transfer of all utility
services to the Premises from the Seller to the Purchaser as of the Closing
Date. In the event any of the utilities can not be transferred as of the Closing
Date, such utilities shall be prorated and calculated through the Closing Date
and, (i) amounts prepaid by Seller for post-Closing services will be remitted by
Purchaser to Seller upon request; or (ii) any amounts remaining to be paid at
Closing for pre-Closing services will be remitted by Seller to Purchaser upon
request.
         5.  Instruments of Transfer and Warranties.
                  5.1 The sale, assignment and delivery of the Assets will be
effected by documents substantially in the form of the Bill of Sale attached
hereto as Exhibit A, standard New York State Department of Motor Vehicles
certificates of title, the Assignment of Trademark attached hereto as Exhibit B
and the Assignment of Rights to Technology attached hereto as Exhibit C
(together referred to as the "Instruments of Transfer"). EXCEPT AS EXPRESSLY
PROVIDED HEREIN, THE ASSETS WILL BE CONVEYED TO THE PURCHASER "AS IS, WHERE IS"
WITHOUT WARRANTIES OR REPRESENTATIONS. IT IS EXPRESSLY UNDERSTOOD AND AGREED
THAT SELLER SHALL IN NO WAY BE DEEMED OR HELD TO BE OBLIGATED, LIABLE, OR
ACCOUNTABLE UPON OR UNDER ANY GUARANTEES OR WARRANTIES, EXPRESSED OR IMPLIED,
INCLUDING THE WARRANTY OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE,
STATUTORY, BY OPERATION OF LAW, OR OTHERWISE, IN ANY MANNER OR FORM BEYOND ANY
EXPRESS WARRANTIES ENUMERATED HEREIN.
         On the Closing Date, Seller will deliver to Purchaser the Instruments
of Transfer, fully executed, and acknowledged where applicable, and
simultaneously with such delivery Seller will take all such steps as may be
necessary to put Purchaser in actual possession of the Assets, as and where
presently located.
         6. The Closing.  The closing of this Agreement (the "Closing")  shall
take place  __________,  2001 at the offices  of Seller at 10:00  a.m.  or at
such  other  time,  date and place as may be agreed on in  writing  by the
parties (the "Closing Date").
         7.  Representations  of Seller.  Seller  represents  and warrants to
Purchaser  that as of the date of its signing this Agreement and as of the
Closing Date:
                  7.1 Valid Corporate Existence; Qualification. Seller is a
transportation corporation duly organized, validly existing and in good standing
under the laws of the State of New York. Seller has the power to carry on its
business as now conducted. Seller is not required to qualify in any other
jurisdiction in order to own the Assets or to carry on the Business as now
conducted, and there has not been any claim by any other jurisdiction to the
effect that Seller is required to qualify or otherwise be authorized to conduct
the Business as a foreign corporation therein.
                  7.2 Consents. No consents are required to be received by or on
the part of Seller to enable it to enter into and carry out this Agreement and
the transactions contemplated hereby, including, without limitation, the
transfer to Purchaser of all of Seller's right, title and interest in and to the
Assets.
                  7.3 Authority; Binding Nature of Agreement. Seller has the
power to enter into this Agreement and to carry out its obligations hereunder.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by the appropriate
corporate action and no other proceedings, corporate or otherwise, on the part
of Seller are necessary to authorize the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby. This
Agreement constitutes the valid and binding obligation of Seller and is
enforceable in accordance with its terms.
                  7.4      No Breach.  Neither the  execution  and delivery of
this  Agreement  nor  compliance  by Seller with any of the provisions hereof
nor the consummation of the transactions contemplated hereby, will:
                           (a) violate or conflict  with any  provision  of the
Certificate  of  Incorporation  or By-Laws of Seller;
                           (b) violate or,  alone or with  notice or the
passage of time,  result in the  material breach or termination of, or otherwise
give any contracting party the right to terminate, or declare a default under,
the terms of any contract to which Seller is a party or by which it may be
bound;
                           (c) violate any judgment,  order, injunction,  decree
or award against, or binding upon, Seller or its properties or assets, the
violation of which would have a material adverse effect on Seller; or
                           (d) violate any law or regulation of any jurisdiction
relating to Seller or the Business, the violation of which would have a material
adverse effect on Seller.
                  7.5 Title. Seller has good and marketable title to all Assets,
except as hereinafter provided. SELLER MAKES NO REPRESENTATIONS OR WARRANTIES,
INCLUDING, WITHOUT LIMITATION, WARRANTIES OF TITLE, WITH RESPECT TO THE BUSINESS
IDENTIFIERS AND THE TECHNOLOGY.
                  7.6 Litigation; Compliance with Law. There are no actions,
suits, proceedings or governmental investigations relating to the Assets or the
Business pending or, to the knowledge of Seller, threatened, or any order,
injunction, award or decree outstanding, against or relating to any of its
Assets, the Business or the transactions contemplated hereby and there exists no
basis for any such action, suit, proceeding, governmental investigation, order,
injunction, award or decree which would have a material adverse effect on the
Assets, the Business or the transactions contemplated by this Agreement. Seller
is not in violation of any law, regulation, ordinance, order, injunction,
decree, award, or other requirement of any governmental or other regulatory
body, court or arbitrator relating to the Assets, the Business or the
transactions.
                  7.7      Environmental, Health, and Safety Matters.
                                    (i)     To the  knowledge  of Seller,  the
Business is in  compliance  with all Environmental, Health, and Safety
Requirements, as hereinafter defined.
                                    (ii)    To the  knowledge  of Seller,  the
Seller has not received any written notice, report or other information
regarding any actual or alleged material violation of Environmental, Health, and
Safety Requirements, or any material liabilities or potential material
liabilities (whether accrued, absolute, contingent, unliquidated or otherwise)
relating to the Business or the Assets, including any investigatory, remedial or
corrective obligations arising under Environmental, Health, and Safety
Requirements. For purposes hereof, the phrase "Environmental, Health, and Safety
Requirements" shall mean all federal, state, local and foreign statutes,
regulations, and ordinances concerning public health and safety, worker health
and safety, and pollution or protection of the environment, including without
limitation all those relating to the presence, use, production, generation,
handling, transportation, treatment, storage, disposal, distribution, labeling,
testing, processing, discharge, release, threatened release, control, or cleanup
of any hazardous materials, substances or wastes, as such requirements are
enacted and in effect on or prior to the Closing Date.
                  7.8 Customer Relationships. To the knowledge of the Seller,
there are no facts or circumstances, including the consummation of the
transactions contemplated by this Agreement, that are reasonably likely to
result in the loss of its customer or a material change in its relationship with
such customer. For the purposes of this Section 7.8, the phrase "to the
knowledge of the Seller" shall mean to the knowledge of Bruce D. Roloson, an
employee of Seller.
         8.        Representations   of  Purchaser.   The  Purchaser  makes  the
following   representations   and warranties  to Seller,  each of which is true
and  correct on the date  hereof and will be true and  correct on the Closing
Date.
                  8.1 Valid Corporate Existence; Qualification. Purchaser is a
corporation duly organized, validly existing and in good standing under the laws
of the State of New York. Purchaser has the power to carry on its business as
now conducted. Purchaser is not required to qualify in any other jurisdiction in
order to own the Assets or to carry on its business as now conducted, and there
has not been any claim by any other jurisdiction to the effect that Purchaser is
required to qualify or otherwise be authorized to do business as a foreign
corporation therein.
                  8.2 Consents. No consents are required to be received by or on
the part of Purchaser to enable it to enter into and carry out this Agreement
and the transactions contemplated hereby, including, without limitation, the
transfer to Purchaser of all of Seller's right, title and interest in and to the
Assets.
                  8.3 Authority; Binding Nature of Agreement. Purchaser has the
power to enter into this Agreement and to carry out its obligations hereunder.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by the Board of
Directors of the Purchaser and no other proceedings, corporate or otherwise, on
the part of Purchaser are necessary to authorize the execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby.
This Agreement constitutes the valid and binding obligation of Purchaser and is
enforceable in accordance with its terms.
                  8.4      No Breach.  Neither the  execution  and delivery of
this  Agreement  nor  compliance  by Purchaser with any of the provisions hereof
nor the consummation of the transactions contemplated hereby, will:
                           (a) violate or conflict  with any  provision  of the
Certificate  of  Incorporation  or By-Laws of Purchaser;
                           (b) violate or,  alone or with  notice or the
passage of time, result in the material breach or termination of, or otherwise
give any contracting party the right to terminate, or declare a Default under,
the terms of any Contract to which Purchaser is a party or by which it may be
bound;

                           (c) violate any judgment,  order, injunction,
decree or award against, or binding upon, Purchaser or its properties or assets,
the violation of which would have a material adverse effect on Purchaser; or
(d) violate any law or  regulation  of any
jurisdiction  relating to  Purchaser  or its business, the violation of which
would have a material adverse effect on Purchaser.
                  8.5 Litigation; Compliance with Law. There are no actions,
suits, proceedings or governmental investigations relating to the Purchaser
pending or, to the knowledge of Purchaser, threatened, or any order, injunction,
award or decree outstanding, against or relating to the Purchaser that could
have a material effect upon the transactions contemplated hereby, and there
exists no basis for any such action, suit, proceeding, governmental
investigation, order, injunction, award or decree which could have a material
adverse effect on the transactions contemplated hereby. Purchaser is not in
violation of any law, regulation, ordinance, order, injunction, decree, award,
or other requirement of any governmental or other regulatory body, court or
arbitrator that could have a material effect upon the transactions contemplated
hereby.
         9.  Additional Covenants.
                  9.1 Accounts Receivable. Each party agrees that if after the
Closing Date it receives payment upon an account receivable that is allocable to
the other party under Article 1, it will remit such payment to the other party
within five days of receipt.
                  9.2 Access. Seller agrees that Purchaser may have reasonable
access solely to the Premises, but only to the extent necessary for Purchaser to
perform its due diligence prior to Closing and during such times as are
reasonably convenient for Seller's employees. Seller agrees that so long as any
books, records and files retained by Seller relating to the Business or Assets
remain in existence and are available, each party (at its expense) shall have
the right to inspect and to make copies of the same at any time during business
hours for any proper purpose. Nothing contained herein shall require that either
party disclose or give the other party access to financial records relating to
such party's ownership of the Assets or operation of the business being
transferred hereunder, except as specifically required by this Agreement.
Neither of the parties hereto will destroy any of such books, records and files
for a period of six years plus any extensions of time necessary due to any tax
return or inquiry, audit, investigation or dispute after the Closing, without
first having offered to deliver such books and records to the other party. Each
party agrees that it will cooperate with and make available to the other party
during normal business hours any books, records and information relating to the
period prior to the Closing and any employees necessary and useful in connection
with (i) any tax return or inquiry, audit, investigation or dispute, (ii) any
litigation against or investigation by a third party, or (iii) any other
business purpose requiring access to such books, records, information or
employees. The party requesting any such books, records, information or
employees shall bear all of the out-of-pocket costs and expenses (including
without limitation attorney's fees, but excluding reimbursement for salaries and
employee benefits) reasonably incurred in connection with providing such books,
records, information or employees.
                           (b)      Seller  shall  permit  Purchaser's
accountants to prepare audited financial statements of the Business to the
extent required for SEC filings of Purchaser or its affiliates. Seller and its
representatives shall reasonably cooperate, to the extent necessary, with
Purchaser's accountants in the preparation of such financial statements.
                  9.3 Confidentiality. The parties hereto agree to maintain the
confidentiality of all of the terms and conditions of this Agreement and the
transactions contemplated hereby and all information acquired or held by either
party in relation to the Business regardless of whether this Agreement closes.
If this Agreement fails to close for any reason, Purchaser shall return to
Seller, without retaining a copy thereof, any and all information including all
schedules, documents or other written information obtained from Seller in
connection with this Agreement and the transactions contemplated hereby.
         Following the Closing Date, Seller shall maintain the confidentiality
of all information relating to the Business prior to the Closing Date and shall
not use such information for any purpose other than as expressly authorized in
writing after the Closing Date by the Purchaser. Notwithstanding anything
hereinabove to the contrary, the obligations imposed upon the Seller herein
shall not apply to information:
                  (a)      which is publicly available prior to the date hereof;
or
                  (b)      which hereafter  becomes  available to the public
through no wrongful act of the Seller; or
                  (c)      which was or is received  from a third party  without
restriction,  not in violation of an agreement of confidence and without breach
of this Agreement; or
                  (d)      which is  disclosed  pursuant  to a  requirement  or
request  of a  government  agency, arbitrator or court.
                  9.4 Brokers. Each party represents to the other that it has
not utilized the services of any broker or other finder in connection with the
purchase and sale of the Assets and there are no fees, commissions or other
payments due to anyone for such services. Seller and Purchaser shall each
indemnify and hold the other harmless in accordance with the indemnification
provisions of Article 13 from and against all claims for a brokerage commission
arising out of a breach of their respective representation under this
Subsection.
                  9.5 Communications With Customers. Within seven (7) days after
the Closing, the parties will send a joint letter or, at Purchaser's option,
Purchaser may send its own independent letter, to each of Seller's customers of
the Business announcing the sale of the Business, identifying the Purchaser and
relating such other information as may be deemed appropriate. Seller and
Purchaser shall use their best efforts to terminate each Client Contract and
Seller shall cooperate with Purchaser in its efforts to cause such clients to
enter into an agreement with Purchaser on substantially similar terms and
conditions (the "Purchaser Client Contracts"). 9.6 Further Assurances. At or
after the Closing, Seller shall also execute and deliver, at Seller's expense,
such further instruments of conveyance, sale, assignment or transfer, and shall
take or cause to be taken such other or further action, as Purchaser shall
request at any time or from time to time in order to vest, confirm or evidence
in Purchaser title to all or any part of the Assets intended to be conveyed,
sold, transferred, assigned and delivered to Purchaser under and in accordance
with this Agreement.
                  9.7 Non-competition. For a period of eighteen (18) months from
and after the Closing Date, the Seller will not engage directly or indirectly in
the Business within the State of New York. If the final judgment of a court of
competent jurisdiction declares that any term or provision of this Section 9.7
is invalid or unenforceable, the parties agree that the court making the
determination of invalidity or unenforceability shall have the power to reduce
the scope, duration, or area of the term or provision, to delete specific words
or phrases, or to replace any invalid or unenforceable term or provision with a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision, and
this Agreement shall be enforceable as so modified after the expiration of the
time within which the judgment may be appealed.
         10. Bulk Sales. Seller and Purchaser waive compliance with the
provisions of Article VI of the Uniform Commercial Code relating to bulk sales
in connection with this Agreement, and Seller will indemnify Purchaser for any
loss or damage incurred by Purchaser due to the failure to comply with such bulk
sale provisions contained in such Article of Uniform Commercial Code, (all as
provided in Article 13 of this Agreement.) Nothing in this Section shall stop or
prevent Seller or Purchaser from asserting as a bar or defense to any action
brought under such bulk sales law that it is not applicable to the sale
contemplated by this Agreement.
         11.  Conditions  Precedent to the Seller's  Obligations.  All
obligations  of Seller under this Agreementare subject to the fulfillment, at
Seller's option, at or before the Closing, of each of the following conditions:
                  11.1 Representations and Warranties. All representations and
warranties of Purchaser contained in this Agreement and in any written
statement, exhibit, certificate, schedule or other document delivered pursuant
hereto or in connection with the transactions contemplated hereby shall be true
and correct as at the Closing Date, as if made at the Closing and as of the
Closing Date.
                  11.2 Covenants. Purchaser shall have performed and complied
with all covenants and agreements required by this Agreement to be performed or
complied with by it prior to or at the Closing.
                  11.3 Litigation Affecting Closing. On the Closing Date no
suit, action, or other proceeding shall be threatened or pending before any
court, arbitration body or governmental agency in which it is sought to
restrain, prohibit, or to obtain damages or other relief in connection with this
Agreement or the consummation of the transactions contemplated hereby.
                  11.4 Service Agreement. Purchaser shall have entered into a
Service Agreement, in the form of attached hereto as Exhibit K, to provide
warranty service to customers of the Business who purchased goods from Seller
prior to the Closing, to provide natural gas station maintenance services and to
provide such other services as may be specified therein.
         12.  Conditions  Precedent to Purchaser's  Obligations.  All
obligations of Purchaser under this Agreement are, at Purchaser's option,
subject to the fulfillment at or before the Closing of the following conditions:
                  12.1 Representations and Warranties. All representations and
warranties of Seller contained in this Agreement and in any written statement,
exhibit, certificate, schedule or other document delivered pursuant hereto or in
connection with the transactions contemplated hereby shall be true and correct
as at the Closing Date, as if made at the Closing and as of the Closing Date.
                  12.2 Covenants. Seller shall have performed and complied with
all covenants and agreements required by this Agreement to be performed or
complied with by it prior to or at the Closing.
                  12.3 Litigation Affecting Closing. On or before the Closing
Date no suit, action, or other proceeding shall be threatened or pending before
any court, arbitration body or governmental agency in which it is sought to
restrain, prohibit, or to obtain damages or other relief in connection with this
Agreement or the consummation of the transactions contemplated hereby.
                  12.4 Service Agreement. Seller shall have entered into a
Service Agreement, in the form of attached hereto as Exhibit K, whereby Seller
engages Purchaser to provide warranty service to customers of the Business who
purchased goods from Seller prior to the Closing, to provide natural gas station
maintenance services and to provide such other services as may be specified
therein.
                  12.5     Financial Due Diligence.  Purchaser  shall be
reasonably  satisfied  with the results of its financial due diligence.
         13.  Indemnification.
                  13.1     Indemnification  Obligations.  From and after the
date hereof,  Seller,  will reimburse, indemnify and hold harmless Purchaser in
against and in respect of:
                  (a) any and all damages, losses, deficiencies, liabilities,
costs and expenses incurred or suffered by Purchaser that result from, relate to
or arise out of:
                           (i) any and all actions,  claims,  suits,  demands,
litigation, governmental or other proceedings, labor disputes, arbitration
actions, governmental audits, inquiries, investigations, criminal prosecutions,
investigations of unfair labor practice charges or complaints (collectively,
"Actions") against the Purchaser that relate to the Business or the Assets in
which the principal event giving rise thereto occurred prior to the Closing
Date, or which result from or arise out of any action or inaction prior to the
Closing Date of Seller or any director, officer, employee, shareholder, agent or
representative of Seller; or
                           (ii) any  misrepresentation,  breach of warranty or
non-fulfillment of any agreement or covenant on the part of Seller under this
Agreement; and
                  (b) any and all Actions, assessments, audits, fines,
judgments, costs and other expenses (including, without limitation, reasonable
legal fees) of Purchaser incident to any of the foregoing or to the enforcement
of this Article 13.
                  13.2 General Indemnification Obligation of Purchaser.2.3
         General Indemnification Obligation of Purchaser.2.3 General
         Indemnification Obligation of Purchaser.2.3 General Indemnification
         Obligation of Purchaser. From and after the date hereof, Purchaser will
         reimburse, indemnify and hold harmless Seller and its successors or
         assigns against and in respect of:
                  (a) any and all damages, losses, deficiencies, liabilities,
costs and expenses incurred or suffered by Seller that result from, relate to or
arise out of:
                                    (i) any and all  Actions  against the Seller
that relate to the Assets in which the principal event giving rise thereto
occurred on or after the Closing Date or which result from or arise out of any
action or inaction prior to the Closing Date of Purchaser or any director,
officer, employee, shareholder, agent or representative of Purchaser; or
                                    (ii) any  misrepresentation,  breach  of
warranty  or  non-fulfillment  of any agreement or covenant on the part of
Purchaser under this Agreement; and
                      (b)  any and all Actions,  assessments,  audits, fines,
judgments,  costs and other expenses (including, without limitation, reasonable
legal fees) of Seller incident to any of the foregoing or to the enforcement of
this Article 13.
                  13.3 Method of Asserting  Claims,  Indemnitee.2.4  Method of
Asserting  Claims,  Etc.2.4  Method of Asserting Claims, Etc.2.4  Method of
Asserting Claims, Etc.
                  (a) In the event that any claim or demand for which a party
(the "Indemnitor") would be liable to indemnify another party hereunder (the
"Indemnitee")is asserted against or sought to be collected from the Indemnitee
by a third party, such Indemnitee shall notify Indemnitor of such claim or
demand, specifying the nature of such claim or demand and the amount or the
estimated amount thereof to the extent then feasible (which estimate shall not
be conclusive of the final amount of such claim and demand) (the "Claim
Notice"). Indemnitor shall thereupon, at its sole cost and expense, defend such
Indemnitee against such claim or demand with counsel reasonably satisfactory to
such Indemnitee.
                      (b) The Indemnitor shall not,  without the prior written
consent of such Indemnitee, consent to the entry of any judgment against such
Indemnitee or enter into any settlement or compromise which does not include, as
an unconditional term thereof (i.e., there being no requirement that such
Indemnitee pay any amount of money or give any other consideration), the giving
by the claimant or plaintiff to such Indemnitee of a release, in form and
substance satisfactory to such Indemnitee, from all liability in respect of such
claim or litigation. If such Indemnitee desires to participate in, but not
control, any such defense or settlement, it may do so at its sole cost and
expense. If, in the reasonable opinion of such Indemnitee, any such claim or
demand or the litigation or resolution of any such claim or demand involves an
issue or matter which could have a materially adverse effect on the business,
operations, assets, properties or prospects of such Indemnitee, then such
Indemnitee shall have the right to control the defense or settlement of any such
claim or demand and its costs and expenses shall be included as part of the
indemnification obligation of Indemnitor; provided, however, that such
Indemnitee shall not settle any such claim or demand without the prior written
consent of Indemnitor, which consent shall not be unreasonably withheld or
delayed. If such Indemnitee should elect to exercise such right, the Indemnitor
shall have the right to participate in, but not control, the defense or
settlement of such claim or demand at its sole cost and expense.
                      (c) The  term  Indemnitee  as used in this  Article  13
shall also include the employees, officers and shareholders of the respective
parties, it being the intent of the parties that the rights and benefits of an
Indemnitee hereunder shall inure to the benefit of such employees, officers and
shareholders to the extent an such claim or demand is asserted against any of
them in their individual capacities.
                  13.4 Payment; Right of Setoff.2.5 Stock Escrow Agreement. In
order to provide further security for the indemnification rights of the
Indemnified Purchaser Party under this Article IX, the Preferred Shares shall be
held in escrow for a period of one (1) year from the Closing Date and disposed
of as provided in the Stock Escrow Agreement described in Section 5.11.1
hereof.9.3 Payment; Right of Setoff.2.5 Stock Escrow Agreement. In order to
provide further security for the indemnification rights of the Indemnified
Purchaser Party under this Article IX, the Preferred Shares shall be held in
escrow for a period of one (1) year from the Closing Date and disposed of as
provided in the Stock Escrow Agreement described in Section 5.11.1 hereof.9.3
Payment; Right of Setoff.2.5 Stock Escrow Agreement. In order to provide further
security for the indemnification rights of the Indemnified Purchaser Party under
this Article IX, the Preferred Shares shall be held in escrow for a period of
one (1) year from the Closing Date and disposed of as provided in the Stock
Escrow Agreement described in Section 5.11.1 hereof.9.3 Payment; Right of
Setoff. Within ten (10) days after such determination of liability under this
Article 13 and written notification to Indemnitor thereof, Indemnitor shall pay
to the Indemnitee the amount of any such claim for indemnification. Further,
pending final determination of any claims, demands or disputes in accordance
with the provisions of Article 13, Indemnitee shall have the right to withhold
from any amounts due pursuant to this Agreement or any other agreement between
Seller and Purchaser the amount of such claims, demands and/or disputes. Upon
the final payment in full of any claim, either by setoff or otherwise, the
Indemnitor shall be subrogated to the rights of the Indemnitee against any
person, firm or corporation with respect to the subject matter of such claim.
                  13.5 Other Rights and Remedies Not Affected.4 Other Rights and
Remedies Not Affected.4 Other Rights and Remedies Not Affected.4 Other Rights
and Remedies Not Affected. The indemnification rights of the parties under this
Article 13 are independent of and in addition to such rights and remedies as the
parties may have at law or in equity or otherwise for any misrepresentation,
breach of warranty or failure to fulfill any agreement or covenant hereunder on
the part of any party hereto, including, without limitation, the right to seek
specific performance, rescission or restitution, none of which rights or
remedies shall be affected or diminished hereby.
         14. Risk of Loss. Except for supplies expended in the ordinary course
of business, if a significant part of the Assets are damaged or destroyed by
fire, explosion, flood, lightning, or other natural disaster prior to closing,
Seller or Purchaser shall be entitled to terminate this Agreement completely.
         15.  Miscellaneous.
                  15.1 Expenses. Except as otherwise specifically provided in
this Agreement, each of the parties shall bear its own expenses in connection
herewith and with respect to any transactions and negotiations contemplated
hereby, whether or not consummated for any reason.
                  15.2 Sales, Transfer and Documentary Taxes. Purchaser shall
pay all federal, state and local sales, documentary and other transfer taxes, if
any, due as a result of the purchase, sale and transfer of the Assets in
accordance herewith whether imposed by law on Seller or Purchaser and Purchaser
shall indemnify, reimburse and hold harmless Seller in respect of the liability
for payment of or failure to pay any such taxes or the filing of or failure to
file any reports required in connection therewith.
                  15.3 Publicity. Neither party may make any press releases,
announcements and other public disclosures regarding the transactions
contemplated hereby without the written consent of the other party, provided,
however, that any party may make any public disclosure it believes in good faith
is required by applicable law concerning its publicly-traded securities (in
which case the disclosing Party will use its reasonable efforts to advise the
other Party prior to making the disclosure).
                  15.4 Equitable Relief. The unauthorized use or disclosure by
Purchaser of any restricted or confidential information prohibited under Section
9.3 hereof would cause irreparable injury to Seller and therefore, Purchaser
agrees that Seller shall be entitled, in addition to any other remedies or
damages available to Purchaser, to seek an injunction to restrain violation of
this Subsection by Purchaser or any of its agents or employees.
                  15.5 Entire Agreement. This Agreement, including the schedules
and exhibits attached hereto, which are a part hereof, constitutes the entire
agreement of the parties with respect to the subject matter hereof. The
representations, warranties, covenants and agreements set forth in this
Agreement constitute all the representations, warranties, covenants and
agreements of the parties and upon which the parties have relied, shall not be
deemed waived or otherwise affected by any investigation made by any party
hereto and, except as may be specifically provided herein, no change,
modification, amendment, addition or termination of this Agreement or any part
thereof shall be valid unless in writing and signed by or on behalf of the party
to be charged therewith.
                  15.6 Notices. Any and all notices or other communications or
deliveries required or permitted to be given or made pursuant to any of the
provisions of this Agreement shall be deemed to have been duly given or made for
all purposes when in writing and hand delivered or sent by certified or
registered mail, return receipt requested and postage prepaid, overnight mail,
nationally recognized overnight courier or telecopier as follows:

If to Seller at:
New York State Electric & Gas Corporation
Corporate Drive-Kirkwood Industrial Park
P.O. Box 5224
Binghamton, New York 13902-5224
Attention: Manager Research & Development
Telecopier: (607) 762-4002

If to Purchaser:
Alternative Energy Technologies, Inc.
c/o  Save On Energy, Inc.
Airport Industrial Center
4851 Georgia Highway 85, Suite 210
Forest Park, GA     30297
Attention:  Ricky D. Davis
Telecopier:  (404) 765-0171

With a copy to:
Membrado & Montell, LLP
535 West 34th Street
2nd Floor
New York, NY  10001
Attention: Scott Montell, Esq.
Telecopier: (646) 792-2258

or at such other address as any party may specify by notice given to the other
party in accordance with this Section.
                  15.7 Choice of Law; Severability. This Agreement shall be
governed by, and interpreted and construed in accordance with, the laws of the
State of New York, excluding choice of law principles thereof. In the event any
clause, section or part of this Agreement shall be held or declared to be void,
illegal or invalid for any reason, all other clauses, sections or parts of this
Agreement which can be effected without such void, illegal or invalid clause,
section or part shall nevertheless continue in full force and effect.
                  15.8 Successors and Assigns; No Assignment. This Agreement
shall be binding upon and inure to the benefit of the parties and their
respective successors and assigns; provided, however, that neither party may
assign any of its rights or delegate any of its duties under this Agreement
without the prior written consent of the other party.
                  15.9 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, and all of which
taken together shall constitute one and the same instrument.
                  15.10    Facsimile  Signatures.  Signatures  hereon which are
transmitted via facsimile shall be deemed original signatures.
                  15.11 Representation by Counsel; Interpretation. Purchaser
acknowledges that it has been represented by counsel or has had the opportunity
to be represented by counsel in connection with this Agreement and the
transactions contemplated by this Agreement. Accordingly, any rule or law or any
legal decision that would require interpretation of any claimed ambiguities in
this Agreement against the party that drafted it has no application and is
expressly waived by such parties. The provisions of this Agreement shall be
interpreted in a reasonable manner to effect the intent of the parties hereto.
                  15.12 Headings; Gender. The headings, captions and/or use of a
particular gender under sections of this Agreement are for convenience and
reference only and do not in any way modify, interpret or construe the intent of
the parties or affect any of the provisions of this Agreement.
                  15.13 Survival. The terms and provisions of this Agreement, to
the extent necessary or contemplated, shall survive the Closing of this
Agreement. Without limiting the foregoing, it is expressly agreed that all
disclaimers of warranty and disclaimers of representations contained in this
Agreement, including, without limitation, those set forth in Sections 5.1 and
7.5 hereof, shall survive Closing.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date and year first above written.

             SELLER:
             New York State Electric & Gas Corporation
             By:   /s/   Dennis R. Urgento
                --------------------------
                         Dennis R. Urgento, Vice President-Customer
                         Engineering & Delivery

             PURCHASER:
             Alternative Energy, Inc.

             By:  /s/ Robby Davis
                -----------------
                      Robby Davis, Chief Financial Officer
EXHIBIT 2.2
                             SECURED PROMISSORY NOTE

                      ALTERNATIVE ENERGY TECHNOLOGIES, INC.
                             SECURED PROMISSORY NOTE

USD$307,800                                             As of  December __, 2001
                                                                    New York, NY

         WHEREAS, the parties hereto entered into a Asset Purchase Agreement
dated as of October 29, 2001, pursuant to which Alternative Energy Technologies,
Inc. agreed to purchase certain of the assets of New York State Electric & Gas
Corporation (the "Asset Purchase Agreement"); and

         WHEREAS, terms used herein but not defined shall have the meaning
assigned to them in the Asset Purchase Agreement; and

         WHEREAS, pursuant to the terms Asset Purchase Agreement the Closing was
scheduled to occur on November 1, 2001 and the Purchase Price was payable in
full at the Closing; and

         WHEREAS,  AET  requested  that  the  Closing  be  postponed  and  that
the  Purchase  Price  be  paid  in installments; and

         WHEREAS, NYSEG is willing to accept AET's request subject to various
terms and conditions agreed to by the parties; and

         WHEREAS, the Payee, as hereinafter defined, has agreed, at the request
of the Maker, to accept payment for the Assets in accordance with the terms of
this Secured Promissory Note;

         NOW THEREFORE,

         FOR VALUE RECEIVED, ALTERNATIVE ENERGY TECHNOLOGIES, INC., a New York
corporation (the "Maker"), having an address at Airport Industrial Center, 4851
Georgia Highway 85, Suite 210, Forest Park, GA 30297, (the "Maker") , hereby
promises to pay to the order of NEW YORK STATE ELECTRIC & GAS CORPORATION, a New
York transportation corporation (the "Payee"), having an address at Corporate
Drive-Kirkwood Industrial Park, PO Box 5224, Binghamton, New York 13902-5224, or
at such other place as the Payee may from time to time designate in writing, in
immediately available United States funds, the principal sum of THREE HUNDRED
AND SEVEN THOUSAND EIGHT HUNDRED DOLLARS ($307,800), together with interest on
the outstanding principal balance from the date hereof at the rate of eight
percent (8%) per annum from November 1, 2001 (which shall be the effective date
of this Note), subject to the terms hereof, payable as follows:
I.       SEVENTY  THOUSAND  DOLLARS  ($70,000) shall be due
and payable on the date hereof,  such payment representing a payment of
principal and no interest.

                  II. FIFTY THOUSAND DOLLARS ($50,000), together with all
accrued interest on the unpaid principal balance hereunder, including, without
limitation, accrued interest from November 1, 2001, shall be due and payable on
March 31, 2002.

                  III.     FIFTY  THOUSAND  DOLLARS  ($50,000),  together  with
all accrued  interest on the unpaid principal balance hereunder,  shall be due
and payable on June 30, 2002.

                  IV.      FIFTY  THOUSAND  DOLLARS  ($50,000),  together  with
all accrued  interest on the unpaid principal balance hereunder,  shall be due
and payable on  September 30, 2002.

                  V.       FIFTY  THOUSAND  DOLLARS  ($50,000),  together  with
all accrued  interest on the unpaid principal balance hereunder,  shall be
payable on December  31, 2002.

                  IV.      The entire unpaid  principal  balance,  together with
all accrued interest on the unpaid principal balance hereunder, shall be due and
payable on March 31, 2003.

         1.       Security.  This Note is executed  concurrently  with a certain
Security Agreement (the "Security Agreement") of even date herewith between the
Maker and the Payee. Pursuant to the Security Agreement, the Maker has pledged
all of its assets as collateral to Payee to secure its prompt and full
performance of its obligations hereunder.

         2.       Representations  & Warranties  of Maker.  The Maker hereby
represents and warrants to the Payee (which representations and warranties shall
be deemed to be repeated by the Maker on each day any amounts remain outstanding
hereunder) that:

                  (a) Corporate  Organization & Standing.  It is a corporation
duly organized, validly existing, and in good standing under the laws of New
York.

                  (b)  Corporate  Power &  Authority.  It has full  corporate
power and authority to perform its obligations hereunder.

                  (c) Due Authorization, Execution and Delivery. It has taken
all requisite corporate and other action to authorize the execution, delivery
and performance of this Note and the transactions contemplated hereby. This Note
has been duly executed and delivered by it.

                  (d) Binding Obligations; No Violation. This Note constitutes a
legal, valid and binding obligation of Maker, enforceable against Maker in
accordance with its terms. The execution, delivery and performance of this Note
and the payment of all amounts due hereunder by Maker will not (i) violate any
provision of its Certificate of Incorporation or Bylaws, (ii) conflict with or
result in the breach of any material provision of, or give rise to a default
under, any agreement with respect to indebtedness or of any other material
agreement to which Maker is a party or by which it or any of its properties or
assets are bound or (iii) conflict with any law, statute, rule or regulation or
any order, judgment or ruling of any court or other agency of government to
which it is subject or any of its properties or assets may be bound or affected.

                  (e) Proceedings. There are no legal actions, suits,
arbitration proceedings, official investigations or other proceedings pending or
threatened against the Maker that if adversely determined would materially
affect the financial condition of Maker or the validity or enforceability of, or
Maker's ability to perform its obligations hereunder.

         3. Acceleration. In the event the Maker shall fail to make any payment
due hereunder and such failure shall continue unremedied for a period of five
(5) days following written notice to Maker by Payee of such default then the
Payee may, by written notice to the Maker, declare the entire unpaid principal
amount of this Note then outstanding to be forthwith due and payable, whereupon
the same shall become forthwith due and payable.

         4.       Miscellaneous.

         Notwithstanding anything to the contrary contained in this Note, the
rate of interest payable on this Note shall never exceed the maximum rate of
interest permitted under applicable law.

This Note may not be waived, changed, modified or discharged orally, but only by
an agreement in writing, signed by the party against whom enforcement of any
waiver, change, modification or discharge is sought.
The Maker and any endorsers hereof, for themselves and their respective
representatives, successors and assigns, expressly (a) waive presentment,
protest, notice of dishonor, notice of non-payment, notice of maturity, notice
of protest, diligence in collection, and the benefit of any applicable
exemptions, including, but not limited to, exemptions claimed under insolvency
laws, and (b) consent that the Payee may release or surrender, exchange or
substitute any property or other collateral or security now held or which may
hereafter be held as security for the payment of this Note, and/or may release
any guarantor, and/or may extend the time for payment and/or otherwise modify
the terms of payment of any part or the whole of the debt evidenced hereby.

         All payments made hereunder shall be applied first to payment of
interest on the principal balance outstanding hereunder from time to time and
then to principal.

         Any notice, demand or request relating to any matter set forth herein
shall be in writing and shall be deemed effective when hand delivered, when
mailed by registered or certified mail (postage prepaid, return receipt
requested), or by overnight mail or courier, or when sent by facsimile
transmission to the Maker at its address stated herein or at such other address
of which it shall have notified the Payee in writing as aforesaid.

         This Note shall be governed by, and construed in accordance with, the
laws of the State of New York, excluding conflict of law principles thereof.

                                                     ALTERNATIVE ENERGY
                                                     TECHNOLOGIES,     INC.

                                                     By:   /s/ Robert Stiles
                                                        ---------------------
                                                        Name:  Robert Stiles
                                                        Title:    President
EXHIBIT 2.3
                               SECURITY AGREEMENT

         SECURITY AGREEMENT (this "Agreement"), made as of the ___ day of
December, 2001, by and between ALTERNATIVE ENERGY TECHNOLOGIES, INC., a New York
corporation ("AET"), and NEW YORK STATE ELECTRIC & GAS CORPORATION, a New York
corporation ("NYSEG").

         WHEREAS, the parties hereto entered into a Asset Purchase Agreement
dated as of October 29, 2001 pursuant to which AET agreed to purchase certain of
the assets of NYSEG (the "Asset Purchase Agreement"); and

         WHEREAS, terms used herein but not defined shall have the meaning
assigned to them in the Asset Purchase Agreement; and

         WHEREAS, pursuant to the terms Asset Purchase Agreement the Closing was
scheduled to occur on November 1, 2001 and the Purchase Price was payable in
full at the Closing; and

         WHEREAS,  AET  requested  that  the  Closing  be  postponed  and  that
the  Purchase  Price  be  paid  in installments; and

         WHEREAS, NYSEG is willing to accept AET's request subject to various
terms and conditions agreed to by the parties; and

         WHEREAS, as a condition of NYSEG waiving its right to enforce the
original Closing Date, AET has agreed to compensate NYSEG for all of the
operating expenses, less any revenues generated, in running the Business between
November 1, 2001 and the date hereof pursuant to a Tracking Account Agreement of
even date herewith by AET for the benefit of NYSEG ("Tracking Agreement"); and

WHEREAS, in partial payment for the Assets to be conveyed pursuant to an Asset
Purchase Agreement, AET issued to NYSEG a secured promissory note of even date
herewith in the original principal amount of $307,800 (the "Note"); and

     WHEREAS, it is a condition to the consummation of the transactions
described herein, AET grants to NYSEG the security interest set forth herein.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1.       Definitions.

                  (a)      The term  "Obligations"  shall mean any and all
obligations  of AET  arising  under the Note and the Tracking Agreement.

                  (b) The term "Collateral" shall mean any and all tangible and
intangible assets in which AET has or shall have an interest, now or hereafter
existing or acquired, and wherever located, together with all additions and
accessions thereto and replacements and substitutions thereof and all proceeds
and products of the foregoing, including, without limitation, the assets
transferred to AET pursuant to the Asset Purchase Agreement.

                  (c) All other terms used herein which are not otherwise
defined herein and are defined in the Uniform Commercial Code of the State of
New York, or any state where AET's assets are located, as applicable
(collectively, the "UCC"), shall have the meanings therein stated.

         2. Grant of Security Interest. AET hereby grants to NYSEG a valid and
binding first priority security interest in the Collateral (the "Security
Interest") as security for the payment, performance, and observance by AET of
the Obligations, which Security Interest shall be senior to any and all other
security interests of any kind.

         3.       Representations and Warranties.  AET represents and warrants
to NYSEG as follows:

                  (a) Authority. The execution and delivery by AET of this
Agreement, and each of the other documents relating hereto (collectively with
this Agreement, the "Security Documents") and the performance of AET's
obligations hereunder and thereunder: (i) are within AET's corporate powers;
(ii) are duly authorized by AET's Board of Directors and stockholders, if
required; (iii) are not in contravention of the terms of AET"s Certificate of
Incorporation or By-laws, or of any indenture, agreement or undertaking to which
AET is a party or by which AET or any of its assets or property is bound or
affected; (iv) do not, as of the date of execution hereof, require the consent,
approval or authorization of or declaration, registration or filing with any
governmental body or any nongovernmental person or entity (except for the filing
of the UCC-1 and other financing statements and/or this Agreement contemplated
hereby; (v) do not contravene any contractual or governmental restriction
binding upon AET; and (vi) will not, except as contemplated herein, result in
the imposition of any liens, security interests or encumbrances of any nature
whatsoever (collectively, "Liens") upon any assets or property of AET under any
existing indenture, mortgage, deed of trust, loan or credit agreement or other
agreement or instrument to which AET is a party or by which it or any of its
assets or property may be bound or affected.

                  (b) Binding Effect. The Security Documents have been duly
executed and delivered on behalf of AET and constitute the legal, valid and
binding obligations of AET enforceable against AET in accordance with their
terms.

                  (c) Full Disclosure. No representation or warranty in this
Agreement contains, or will contain, any untrue statement of any material fact
as of the date when made or omits, or will omit, to state any material fact as
of the date when made or omits, or will omit, to state any material fact
necessary to make the statements herein or therein not misleading as of the date
when made; there is no fact known to AET that has not been disclosed to NYSEG in
writing which materially and adversely affects or would materially and adversely
affect the business, financial condition or operations of AET.

         4.       Affirmative  Covenants.  From and  after the date  hereof  and
continuing  so long as any of the Obligations shall remain unpaid, unless NYSEG
shall otherwise consent in advance and in writing:

                  (a)      Perfection of Security Interest.

                           (i)      AET will,  from time to time, do whatever
NYSEG may reasonably request by way of obtaining, executing, delivering and/or
filing financing statements, copyright mortgages, patent collateral assignments
and the like, and other notices and amendments and renewals thereof, and will
take any and all steps and observe such formalities as NYSEG may request, in
order to create, perfect and maintain valid continuing Liens upon the Collateral
consistent with the Security Interest and as contemplated by this Agreement.
(ii) AET hereby irrevocably appoints NYSEG as its lawful attorney-in-fact and
agent, with full power of substitution, to execute and deliver, on behalf of and
in the name of AET, such financing statements, assignments, notices, pledges and
other documents and agreements, and to take such other actions as NYSEG may deem
reasonably necessary for the purpose of the creation, perfection, maintenance or
continuation of the Security Interest, under any applicable law, and NYSEG is
hereby authorized to file on behalf of and in the name of AET, at AET's expense,
such financing statements, assignments, notices, pledges and other documents and
agreements in any appropriate governmental office. The right is expressly
granted to NYSEG, in its discretion, in those jurisdictions where the same is
permitted, to file one or more financing statements (including amendments and
renewals thereof) under the UCC or similar law or under federal and/or foreign
patent, copyright and/or trademark law signed only by NYSEG, naming AET as
debtor and naming NYSEG as secured party and indicating therein the types, or
describing the items, of the Collateral. This power of attorney is coupled with
an interest and irrevocable while any of the Obligations shall remain unpaid.

                  (b)      Tax Obligations.

                           (i)      AET shall file all tax and  information
returns and reports required by all applicable taxing authorities (all prepared
in accordance with applicable law), pay or cause to be paid all license fees and
related taxes and charges, and pay or cause to be paid all income, employment,
real and personal property taxes and other governmental taxes and charges
assessed against AET, or payable by AET, at such times and in such manner as to
prevent any penalty or interest from accruing thereon, or any Lien or charge
from attaching to the Collateral; provided that AET shall have the right to
contest any such fees, premiums, taxes and charges prior to the payment thereof
for so long as such contest is pursued diligently and in good faith by
appropriate proceedings.

                           (ii)     AET shall  notify  NYSEG  promptly  (and in
no event later than fifteen (15) days) after becoming aware of the intent of the
Internal Revenue Service or other taxing authority (the "Taxing Authority") to
assert a deficiency with respect to it, and shall promptly (and in no event
later than fifteen (15) days following receipt of any notice of deficiency)
inform NYSEG of such proposed deficiency and deliver to NYSEG a copy of any
notices of deficiency received from the Taxing Authority. If NYSEG so requests,
and if there is a reasonable legal basis therefor, AET shall take all reasonable
actions necessary to contest such claimed deficiency and shall appoint outside
tax counsel reasonably acceptable to NYSEG to contest such claims of deficiency
and shall direct such counsel to consult with and to provide NYSEG with periodic
status reports and assessments of the legal merits of the contest. At NYSEG's
request, such contest shall continue through the appropriate administrative and
court procedures, including appeals therefrom, until such outside tax counsel
informs AET that further contest would be inadvisable taking into account all
factors (including any settlement or compromise proposed by the Taxing
Authority).
(c) Further Assurances. AET shall at any time or from time to
time execute and deliver such further instruments and documents and take such
further action as may reasonably be requested by NYSEG to carry out, to NYSEG's
reasonable satisfaction, the transactions contemplated by Security Documents.

                  (d) Indemnification. AET shall indemnify, defend and hold
harmless NYSEG and its officers, directors, agents and employees from and
against all losses, costs, fines, liabilities, judgments, actions, penalties,
damages, injuries, claims, demands, disbursements and expenses, including
reasonable attorneys' fees and costs, arising out of (i) the execution or
consummation of this Agreement and the other Security Documents; (ii) the
operation or maintenance of any of the Collateral; or (iii) any aspect of, or
any transaction contemplated by or referred to in, or any matter related to,
this Agreement, in each case whether or not AET or such holder is a party
thereto, except to the extent such losses, cost, fines, liabilities, judgments,
actions, penalties, damages, injuries, claims, demands, disbursements and
expenses are directly caused by the gross negligence or willful misconduct of
NYSEG or such holder or their respective agents, servants or employees. AET
shall assume the settlement and defense of any suit or other legal proceeding
brought to enforce any of the foregoing (with counsel reasonably satisfactory to
NYSEG), and shall pay all judgments entered in any such suit or legal
proceeding. AET shall not compromise or settle any such suit or other legal
proceeding without the prior written consent of NYSEG, which consent shall not
be unreasonably withheld or unduly delayed. The indemnities and assumptions of
liabilities and obligations herein provided for shall continue in full force and
effect notwithstanding the termination of this Agreement.

         5.       Negative  Covenants.  From  and  after  the date  hereof,  and
continuing  so long as any of the Obligations shall remain unpaid, unless NYSEG
shall otherwise consent in advance and in writing:

                  (a) Liens. AET will not create or suffer to exist any Lien
upon or with respect to the Collateral which is superior in rank to the Lien
created hereby, except Liens in favor of NYSEG.

                  (b) Amendments. AET will not request, permit or consent to any
amendment to its Certificate of Incorporation, By-Laws or other organizational
documents, which amendment could have a material adverse effect on the Security
Interest or otherwise on NYSEG in its capacity as a secured party under this
Agreement.
6. Inspection and Audit. From and after the date hereof, and continuing
so long as any of the Obligations shall remain unpaid, AET will permit NYSEG, or
any person designated by NYSEG in writing, from time to time hereafter, to enter
AET's place or places of business (or any other place where the Collateral or
any information relating thereto is kept or located) during all business hours
upon not less than three (3) business days' prior notice, and, without hindrance
or delay (provided that NYSEG or such designees shall not unreasonably disrupt
the day-to-day operations of AET), (i) to inspect, audit, check and make copies
of and extracts from AET's books, records, journals, orders, receipts and any
correspondence and other data relating to the Collateral, the Security Interest
and the Security Documents to an extent within its own discretion, (ii) to take
such steps as AET deems reasonably necessary to verify the accuracy and
completeness of the foreoing, and (iii) to reasonably discuss any issues
relating thereto with any of NYSEG's officers, directors or outside auditors.

         7. Remedies on Default. Upon the occurrence of any one or more defaults
under the Note, NYSEG shall have the following rights and remedies in addition
to all rights and remedies of a secured party under the UCC, federal and/or
foreign patent, copyright and/or trademark law or other applicable statute or
rule, in any jurisdiction in which enforcement is sought, all such rights and
remedies being cumulative and not exclusive:

                  (a) Collateral. (i) NYSEG may at any time and from time to
time, with or (if and to the extent permitted by applicable law) without process
of law and with or (if and to the extent permitted by applicable law) without
the aid and assistance of others, enter upon any premises in which the
Collateral or any part thereof may be located and, without resistance or
interference by AET, take or otherwise put itself in possession of the
Collateral; and/or dispose of all or any part of the Collateral located on any
premises of AET or its agents; and/or require AET to assemble and make available
to NYSEG all or any part of the Collateral at any place and time reasonably
designated by NYSEG; and/or remove all or any part of the Collateral from any
premises on which any part thereof may be located for the purpose of effecting
preservation or sale or other disposition thereof; and/or sell, resell, lease,
assign and deliver, or otherwise dispose in good faith of, the Collateral or any
part thereof in its existing condition on commercially reasonable terms or
following any commercially reasonable preparation or processing, at public or
private proceedings, in one or more parcels at the same or different times with
or without having the Collateral at the place of sale or other disposition, for
cash, upon credit or for future delivery, and in connection therewith NYSEG may
grant options, at such place or places and time or times and to such persons,
firms or corporations on commercially reasonable terms as NYSEG deems
appropriate, and without demand for performance, and/or liquidate or dispose of
the Collateral or any part thereof in any other commercially reasonable manner.
Provided notice has been given in accordance herewith, failure of AET to contest
within a reasonable period on the grounds of commercial reasonability shall be
deemed a waiver of said defense.

                           (ii) If any of the  Collateral  is sold by NYSEG
upon credit or for future delivery, NYSEG shall not be liable for the failure of
the purchaser to pay for the same and, in the event of any such failure, NYSEG
may, in accordance with any applicable credit or related agreements, resell such
Collateral. NYSEG may buy any part or all of the Collateral at any public sale
and, if any part of the Collateral is of a type which is the subject of widely
distributed standard price quotations, NYSEG may buy at a private sale, all free
from any equity or right of redemption, which is hereby waived and released by
AET, and NYSEG may make payment therefor (by endorsement without recourse) in
notes of NYSEG.

                           (iii)  NYSEG  may  apply  the cash  proceeds
actually received from any sale or other disposition of the Collateral in
accordance herewith to the reasonable expenses of retaking, holding, preparing
for sale, selling, leasing and the like, reasonable legal fees and expenses,
court costs, collection charges, travel and other expenses which may be incurred
by NYSEG in attempting to collect the Obligations or to enforce this Agreement
and realize proceeds upon conversion of the Collateral, or in the prosecution or
defense of any action or proceeding related to the subject matter of this
Agreement; and then to the Obligations in such order as to principal and/or
interest due as NYSEG may in its sole reasonable discretion determine; and AET
shall at all times be and remain liable and, after crediting the net proceeds of
sale or other disposition as aforesaid, will pay NYSEG on demand any deficiency
remaining, including interest thereon and the balance of any expenses at any
time unpaid, with any surplus to be paid to AET, subject to any duty of NYSEG to
the holder of any subordinate security interest in the Collateral known to
NYSEG, but only to the extent required by law.

                  (b) Proceeds. Any of the proceeds of the Collateral received
by AET shall not be commingled with other property of AET, but shall be
segregated, held by AET in trust for NYSEG as the exclusive property of NYSEG,
and AET will immediately deliver to NYSEG the identical checks, moneys or other
proceeds of Collateral received, and NYSEG shall have the right to endorse the
name of AET on any and all checks, or other forms of remittance received, where
such endorsement is required to effect collection. AET hereby designates,
constitutes and appoints NYSEG and any designee or agent of NYSEG as
attorney-in-fact of AET, irrevocably and with power of substitution, to endorse
the name of AET on any notes, acceptances, checks, drafts, money orders or other
evidences of payment or proceeds of the Collateral that may come into NYSEG's
possession; to sign the name of AET on any invoices, documents, drafts against
account debtors of AET, assignments, requests for verification of accounts and
notices to debtors of AET; to execute any endorsements, assignments, or other
instruments of conveyance or transfer; and to do all other acts and things
necessary and advisable in the sole discretion of NYSEG to carry out and enforce
this Agreement. Said attorney or designee shall not be liable for any acts or
commission or omission nor for any error of judgment or mistake of fact or law.
This power of attorney is coupled with an interest and irrevocable while any of
the Obligations shall remain unpaid.
8. Liability Disclaimer. Except for reasonable care of Collateral in
its possession, if any, under no circumstances whatsoever shall NYSEG be deemed
to assume any responsibility for, or obligation or duty with respect to, any
part or all of the Collateral, of any nature or kind whatsoever, or any matter
or proceeding arising out of or relating thereto. NYSEG shall not be required to
take any action of any kind to collect or protect any interest in the
Collateral, including, but not limited to, any action necessary to preserve its
or AET's rights against prior parties to any of the Collateral. NYSEG shall not
be liable or responsible in any way for the safekeeping, care or custody of any
of the Collateral (except for reasonable care of Collateral in its possession),
or for any loss or damage thereto, or for any diminution in the value thereof,
or for any act or default of any agent or bailee of NYSEG or AET, or of any
carrier, forwarding agency or other person whomsoever, or for the collection of
any proceeds, but the same shall be at AET's sole risk at all times. AET hereby
releases NYSEG from any claims, causes of action and demands at any time arising
out of or with respect to this Agreement or the Obligations, and any actions
taken or omitted to be taken by NYSEG with respect thereto, except for such
claims, causes of action, demands and/or actions directly caused by NYSEG's
gross negligence or willful misconduct, and AET agrees to defend and hold NYSEG
harmless from and with respect to any and all such claims, causes of action and
demands, except for such claims, causes of action, demands and/or actions
directly caused by NYSEG's gross negligence or willful misconduct. NYSEG's prior
recourse to any part or all of the Collateral shall not constitute a condition
of any demand for payment of the Obligations or of any suit or other proceeding
for the collection of the Obligations.

         9. Nonwaiver. No failure or delay on the part of NYSEG in exercising
any of its rights and remedies hereunder or otherwise shall constitute a waiver
thereof, and no single or partial waiver by NYSEG of any default or other right
or remedy which it may have shall operate as a waiver of any other default,
right or remedy or of the same default, right or remedy on a future occasion.

         10. Waivers. AET hereby waives presentment, notice of dishonor and
protest of all instruments included in or evidencing any of the Obligations or
the Collateral and any and all other notices and demands whatsoever (except as
expressly provided herein) whether or not relating to such instruments. In the
event of any litigation at any time arising with respect to any matter connected
with this Agreement or the Obligations, AET hereby waives the right to a trial
by jury and AET hereby waives any and all rights of setoff and rights to
interpose counterclaims of any nature except for counterclaims which are
compulsory or which would be lost for failure to be raised.

         11.      Binding  Effect.  This Agreement and all  Obligations of AET
hereunder shall be binding upon the successors or assigns of AET, and shall,
together with the rights and remedies of NYSEG hereunder, inure to the benefit
of NYSEG and its successors, endorsees and assigns.

         12. Application of Payments. In addition to its other rights herein,
NYSEG shall have the continuing and exclusive right to apply or reverse and
reapply any and all payments to any portion of the Obligations. To the extent
that AET makes a payment or payments to NYSEG or NYSEG receives any payment or
proceeds of any security for such Obligations for AET's benefit, which
payment(s) or proceeds or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, state
or federal law, common law or equitable cause, then, to the extent of such
payment or proceeds received, the Obligations or part thereof intended to be
satisfied shall be revived and continue in full force and effect, as if such
payment or proceeds had not been received by NYSEG.
13. Consent to Jurisdiction. AET agrees that (i) any state or federal
court within the State of New York shall have personal jurisdiction over AET,
and (ii) service of any summons and complaint or other process in any such
action or proceeding may be made by registered or certified mail directed to AET
at AET's address set forth below, and service so made shall be deemed to be
completed upon the earlier of actual receipt or three (3) days after the same
shall have been posted as aforesaid, AET hereby waiving personal service
thereof. Nothing in this paragraph shall affect the right of NYSEG to serve
legal process in any other manner permitted by law or affect the right of NYSEG
to bring any action or proceeding against AET or its property in the courts of
any other jurisdiction. AET and NYSEG agree that any claim or suit between or
among the parties hereto involving this Agreement, any of the other Security
Documents or any transactions contemplated hereby or thereby shall be brought in
and decided by the state or federal courts located in New York County, New York.

         14. Entire Agreement. This Agreement and the schedules attached hereto
constitutes the entire agreement of the parties with respect to the subject
matter hereof and there are no representations, warranties or commitments except
as set forth herein. This Agreement supersedes all prior agreements,
understandings, negotiations and discussions, whether written or oral, of the
parties hereto relating to the matters set forth in this Agreement. The
representations, warranties, covenants and agreements set forth in this
Agreement constitute all the representations, warranties, covenants and
agreements of the parties and upon which the parties have relied, shall not be
deemed waived or otherwise affected by any investigation made by any party
hereto and, except as may be specifically provided herein, no change,
modification, amendment, addition or termination of this Agreement or any part
thereof shall be valid unless in writing and signed by or on behalf of the party
to be charged therewith.

         15. Notices. Any and all notices or other communications or deliveries
required or permitted to be given or made pursuant to any of the provisions of
this Agreement shall be in writing and shall be deemed to have been duly given
or made for all purposes when hand delivered or sent by certified or registered
mail, return receipt requested and postage prepaid, overnight mail or courier,
or telecopier to the addresses set forth in the Asset Purchase Agreement or at
such other address as any party may specify by notice given to the other party
in accordance with this paragraph 15.

         16. Choice of Law; Severability. This Agreement shall be governed by,
and interpreted and construed in accordance with, the laws of the State of New
York applicable to agreements performed wholly within such state. In the event
any clause, section or part of this Agreement shall be held or declared to be
void, illegal or invalid for any reason, all other clauses, sections or parts of
this Agreement which can be effected without such void, illegal or invalid
clause, section or part shall nevertheless continue in full force and effect.

17.      Headings.  The section  headings of this  Agreement are for
convenience and reference only and do not in any way modify, interpret or
construe the intent of the parties or affect any of the provisions of this
Agreement.

         18.      Counterparts.     This Agreement may be executed in two or
more counterparts for the convenience of the parties hereto, each of which
executed counterparts shall be deemed an original but all of such executed
counterparts shall be considered one and the same agreement.

         19.      Facsimile  Signatures.   Signatures hereon which are
transmitted via facsimile shall be deemed original signatures.

                  IN WITNESS  WHEREOF,  the  undersigned  have executed this
Agreement as of the date first written above.

                 NEW YORK STATE ELECTRIC & GAS       CORPORATION
                 By:   /s/ Dennis R. Urgento
                      -----------------------
                           Dennis R. Urgento, Vice President-Customer
                           Engineering & Delivery

                 ALTERNATIVE ENERGY TECHNOLOGIES, INC.

                 By:   /s/ Robert Stiles
                      -------------------
                           Robert Stiles, President
EXHIBIT 2.4
                                    GUARANTY

     THIS GUARANTY ("Guaranty"), dated as of this __ day of December, 2001, is
made by SAVE ON ENGERGY, INC. (the "Guarantor"), a Georgia corporation having a
principal place of business located at Airport Industrial Center, 4851 Georgia
Highway 85, Suite 210, Forest Park, GA 30297 in favor of NEW YORK STATE ELECTRIC
& GAS CORPORATION, a New York transportation corporation, having an address at
Corporate Drive-Kirkwood Industrial Park, PO Box 5224, Binghamton, New York
13902-5224 ("NYSEG").

     WHEREAS,  the Guarantor is the parent  corporation and sole  shareholder of
Alternative  Energy  Technologies, Inc., a Georgia corporation ("Buyer"); and

     WHEREAS, in partial payment for the purchase of certain assets from NYSEG
pursuant to a Bill of Sale and other transfer documents of even date herewith,
Buyer issued to NYSGEG a secured promissory note of even date herewith in the
original principal amount of 307,800 (the "Note"); and

       WHEREAS, in connection with said purchase, Buyer also executed a Tracking
Account Agreement of even date herewith for the benefit of NYSEG ("Tracking
Agreement"); and

     WHEREAS, it is a condition to the consummation of the foregoing
transactions that the Guarantor guarantee any and all of the obligations of
Buyer under the Note and the Tracking Agreement;

     NOW, THEREFORE, in consideration of the foregoing and for other and further
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Guarantor agrees as follows:

     1. Guaranty. The Guarantor hereby unconditionally and irrevocably
guarantees to NYSEG the full and prompt payment of all amounts which may be
presently due and owing and all sums which shall in the future become due and
owing to NYSEG (or its permitted endorsees, successors or assigns) under the
Note and the Tracking Agreement, including, without limitation, the payment of
principal, interest, and expenses under either or both (collectively, the
"Guaranteed Obligations").

     2. Authority. The Guarantor has determined that the execution and delivery
of this Guaranty is in its best interests, will create a direct benefit to the
Guarantor, is within its powers, and is in furtherance of its business purposes
and objectives. The execution of this Guaranty by the undersigned person has
been authorized by all necessary corporate action and will not violate the
Guarantor's charter or by-laws or any material agreement, instrument, order,
judgment or decree to which it is a party or by which it is bound.

     3. Guarantee of Payment. This Guaranty constitutes a guarantee of payment,
and not of collection. The liability of the Guarantor hereunder is direct and
unconditional, and may be enforced without requiring NYSEG first to resort to
any other right, remedy, or security. The Guarantor shall not have any right of
subrogation, contribution, reimbursement or indemnity whatsoever, until all of
the Guaranteed Obligations shall have been indefeasibly paid in full.

     4. No Impairment. This Guaranty shall not be released, impaired, affected
by any modification, extension, amendment, release, or other alteration of any
of the Guaranteed Obligations or of any security there for, nor by any
agreements or arrangements whatever with Buyer or anyone else, and the liability
of the Guarantor hereunder shall apply to the Guaranteed Obligations as so
altered, modified.

     5. Primary Obligation. No invalidity, irregularity or unenforceability of
all or any part of the Guaranteed Obligations or of any security therefor
(including, without limitation, as a result of Buyer's bankruptcy,
reorganization or insolvency, or pursuant to any assignment for the benefit of
creditors, receivership, or similar proceeding under any law or with respect to
any party, or by any actions of a trustee in any said proceeding) shall affect,
impair or be a defense to this Guaranty, and this Guaranty shall be a primary
obligation of the Guarantor and nothing shall discharge or satisfy the liability
of the Guarantor hereunder except the full payment and performance of the
Guaranteed Obligations.

     6.  Termination of Guaranty.  This Guaranty is a continuing  Guaranty which
shall remain  effective  until the Guaranteed Obligations have been satisfied in
full.

     7. Default. If the Guarantor should at any time become insolvent or make a
general assignment for the benefit of creditors, or if a petition in bankruptcy
or any insolvency or reorganization proceedings shall be filed or commenced by,
against (and not removed within 30 days) or in respect of the Guarantor, or if
the Guarantor should at any time liquidate, dissolve, wind up its affairs or
cease doing business, or contest, cancel or otherwise terminate the obligations
under this Guaranty, then and in any such event, any and all obligations of the
Guarantor (including the Guaranteed Obligations, whether or not then due) shall,
at the option of NYSEG forthwith become due and payable without notice or other
action of any kind by NYSEG any other party.

     8. Disgorgement of Payments. If any claim is ever made on NYSEG for
repayment or recovery of any amount or amounts received by NYSEG in payment, or
on account of any of the Guaranteed Obligations, and NYSEG repays all or part of
such amount(s), the Guarantor shall be and remain liable hereunder for the
amount so repaid or recovered to the same extent as if such amount had never
originally been received NYSEG, notwithstanding any termination hereof or any
cancellation of any instrument evidencing the Guaranteed Obligations.

     9. Waivers By Guarantor. The Guarantor hereby waives all rights of notice
or demand including, without limitation: notice of acceptance hereof and notice
of any liability to which it may apply; presentment, demand for payment and
protest of any instrument, and notice of dishonor or nonpayment; notice of
default or nonpayment by Buyer; and all other notices to which the Guarantor may
otherwise be entitled. In addition, the Guarantor waives all suretyship defenses
it may have, whether now or in the future. The Guarantor also waives any right
to seek contribution, indemnification, subrogation or reimbursement from Buyer,
until all of the Guaranteed Obligations have been indefeasibly paid in full.

     10. No Implied Waiver By NYSEG. No act, omission, or delay by NYSEG or
course of dealing between NYSEG and the Guarantor and/or Buyer shall constitute
a waiver of the rights and remedies of NYSEG hereunder. No single or partial
waiver NYSEG of any right or remedy which it may have hereunder shall operate as
a waiver of any other right or remedy or of the same right or remedy on a future
occasion. All rights and remedies of NYSEG hereunder shall be cumulative, and no
such right or remedy shall be exclusive of any other right or remedy.

     11. Amendment. No waiver of any rights hereunder and no modification or
amendment of this Guaranty shall be effective unless the same shall be in
writing, duly signed on behalf of NYSEG and each such waiver, modification, or
amendment, if any, shall apply only with respect to the specific instance
involved, and shall in no way impair the rights of NYSEG or the obligations of
the Guarantor to NYSEG in any other respect or at any other time.

     12. Notices. All notices, requests, consents, and other communications
hereunder shall be in writing, shall be addressed to the receiving party's
address set forth above or to such other address as a party may designate by
notice hereunder, and shall be either (i) delivered by hand, (ii) sent by
reputable overnight courier by next day, priority, or (iii) sent by registered
or certified mail, return receipt requested, postage prepaid. All notices,
requests, consents, and other communications hereunder shall be deemed to have
been given either (i) if by hand, at the time of the delivery thereof to the
receiving party at the address of such party set forth above, (ii) if sent by
overnight courier, on the next business day following the day such notice is
delivered to the courier service, or (iii) if sent by registered or certified
mail, on the 5th business day following the day such mailing is made.

     13. Severability. In the event that any court of competent jurisdiction
shall determine that any provision, or any portion thereof, contained in this
Guaranty shall be unreasonable or unenforceable in any respect, then such
provision shall be deemed limited to the extent that such court deems it
reasonable and enforceable, and as so limited shall remain in full force and
effect. In the event that such court shall deem any such provision, or portion
thereof, wholly unenforceable, the remaining provisions of this Guaranty shall
nevertheless remain in full force and effect.

     14. Successors and Assigns. This Guaranty and all obligations hereunder
shall be binding upon the successors and permitted assigns of the Guarantor and
shall, together with the rights and remedies NYSEG hereunder, inure to the
benefit of NYSEG and its permitted successors, endorsees and assigns. The rights
and obligations of the Guarantor under this Guaranty shall not be assigned by
the Guarantor and the rights and obligations of NYSEG under this Guaranty may
only be assigned to a permitted Holder (as such term is defined in the Note) of
the Note.

     15. Entire Agreement. This Guaranty embodies the entire agreement and
understanding between NYSEG and the Guarantor with respect to the subject matter
hereof and supersedes all prior oral or written agreements and understandings
relating to the subject matter hereof. No statement, representation warranty,
covenant, agreement, course of dealing, course of conduct, or course of
performance of any kind not expressly set forth in this Guaranty shall affect,
or be used to interpret, change or restrict, the express terms and provisions of
is Guaranty.

     16. Governing Law. This Guaranty shall be governed by and construed in
accordance with the laws of New York (without giving effect to its conflict of
laws). Any legal action or proceeding with respect to this Guaranty may be
brought in the courts of New York or of the United States of America for the
District of New York, by execution and delivery of this Agreement, the Guarantor
hereby accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The Guarantor hereby
knowingly, voluntarily, intentionally and irrevocably waives, in connection with
any such action or proceeding: (i) any objection, including, without limitation,
any objection to the laying of venue or based on the grounds of forum non
conveniens, which it may now or hereafter have to the bringing of any such
action or proceeding in such respective jurisdictions, and (ii) to the maximum
extent not prohibited by law, any right it may have to a trial by jury in
respect of any litigation directly or indirectly arising out of, under or in
connection with this Guaranty. The Guarantor irrevocably consents to the service
of process of any of the aforementioned courts in any such action or proceeding
by the mailing of copies thereof by registered or certified mail, postage
prepaid, to the Guarantor at the address set forth above, or at such other
address as the Guarantor may provide to NYSEG from time to time. Nothing herein
shall affect the right of NYSEG to serve process in any other manner permitted
by law or to commence legal proceedings or otherwise proceed against the
Guarantor in any other jurisdiction.

         IN WITNESS WHEREOF, the Guarantor has executed this Guaranty as of the
date first set forth above.

                                                     SAVE ON ENERGY, INC.

                                                     By:   /s/  Robert Stiles
                                                         --------------------
                                                         Name:  Robert Stiles
                                                       Title:   President
EXHIBIT 10.1
                            STOCK PURCHASE AGREEMENT (Composite Version)

         Stock Purchase Agreement (the "Agreement") made as of this 10th day of
December, 2001, by and between Save On Energy, Inc., a Georgia corporation with
its principal place of business located at Airport Industrial Center, 4851
Georgia Highway 85, Suite 210, Forest Park, GA 30297 (the "Corporation"") and
SWI Holdings, Limited, a Corporation organized under the laws of Bermuda (the
"Investor").

                                R E C I T A L S :

         WHEREAS, the Corporation desires to sell and the Investor desires to
purchase, for the consideration set forth herein, subject to the terms and
conditions of this Agreement, (i) 2,600,000 shares (the "Shares") of the common
stock of the Corporation, par value $.001 per share (the "Common Stock"), and
(ii) a warrant (the "Warrant") to purchase up to 250,000 additional shares of
Common Stock (the "Warrant Shares"), such warrant to be substantially in the
form attached hereto as Exhibit A.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties hereby agree as follows:

                                    SECTION 1
                                 SHARE PURCHASE

Subject to and upon the terms and conditions of this Agreement, at the closing
of the transactions contemplated by this Agreement, the Corporation shall sell,
transfer, convey, assign and deliver to the Investor, and the Investor shall
purchase from the Corporation, the Shares and the Warrant, free and clear of all
title defects, objections, liens, pledges, claims, options, charges, security
interests or encumbrances of any nature whatsoever (collectively,
"Encumbrances").

                                    SECTION 2
                                  CONSIDERATION

The Investor agrees to pay to the Corporation the aggregate amount of FIVE
HUNDRED THOUSAND DOLLARS (USD$500,000) in immediately available funds in
consideration of the Shares and the Warrant, such amount to be payable as
follows:

(i)      ONE HUNDRED THOUSAND (USD$100,000) shall be payable at the Closing (the
"Closing Amount");

(ii)     TWO HUNDRED THOUSAND (USD$200,000) shall be payable on or before
December 7, 2001; and

(iii) TWO HUNDRED THOUDSAND (USD$200,000) shall be payable on or before January
15, 2002.

                                    SECTION 3
                                     CLOSING

                  3.1      Closing. A closing  (the  "Closing")  of the
transactions  contemplated  hereby shall take place at the offices of Membrado
Montell,  LLP or such other  mutually  agreeable  location at 10:00 A.M. on the
date hereof.

                  3.2      Action at the Closing.    At the Closing, the parties
shall take the following actions:

                           (a)      The  Corporation  shall  deliver,  or cause
the following to be delivered,  to the Investor:

                                    (i)      stock certificates representing the
Shares in the name of Investor or its designees;
                                    (ii)     the Warrant; and
                                    (iii)   such other  documents,  instruments
and  certificates  as the Corporation shall reasonably request to accomplish the
letter and spirit of this Agreement.

                           (b)      The Investor  shall deliver to the
Corporation  the Closing Amount in cash as set forth in Section 2(i) of this
Agreement.

                                    SECTION 4
                         REPRESENTATIONS OF THE INVESTOR

                  The Investor represents to the Corporation as follows:

                  4.1 Organization. The Investor is a Corporation duly
organized, existing, and in good standing under the laws of Bermuda, and has the
corporate power to conduct the business which it conducts and proposes to
conduct, and is qualified to do business in each jurisdiction in which it is
required to be so qualified.

                  4.2 Due Authorization.  The Investor  has the complete  power
to execute and deliver this Agreement, and consummate all of the transactions
contemplated hereby. This Agreement constitutes the valid and legally binding
obligations of the Investor, enforceable against the Investor in accordance with
its terms.

                  4.3 No Violation. Neither the execution, delivery nor
consummation of the Agreement by the Investor, will, with the passage of time,
the giving of notice, or otherwise, result in a material violation or breach of,
or constitute a default under, any term or provision of any law, rule,
regulation, order, decree, judgment, indenture, mortgage, deed of trust, lease,
instrument, contract, agreement or other restriction to which the Investor is a
party or to which the Investor, or its property is subject or bound.

                  4.4 Receipt and Review of Certain Information. The Investor
has had a thorough and adequate opportunity to ask questions of the Corporation,
or a person or persons acting on its behalf, concerning the Corporation and the
terms and conditions of the investment described in this Agreement, and all such
questions have been answered to the full satisfaction of the Investor. The
Investor has also had the opportunity to review any documents relating to the
Corporation that its representatives have requested and to otherwise conduct due
diligence, and such due diligence review has been fully satisfactory to the
Investor. The Investor understands and acknowledges that the Corporation cannot
provide assurances with respect to any projections or predictions as to the
future business or financial performance of the Corporation.

                  4.5 Risk Associated with Investment in the Common Stock. The
Investor recognizes that an investment in the Common Stock involves a high
degree of risk for an indefinite period of time, and it has taken full
cognizance of and understands all of the risks related thereto.

                  4.6 Not an Underwriter. The Investor is not an "underwriter"'
as defined in Section 2(a)(11) of the Securities Act, and is acquiring the
Common Stock for investment purposes only.

                  4.7 Financial Ability. The Investor has the financial ability
to bear the economic risk of its investment, including a total loss of the
investment, has adequate means for providing for its current needs and personal
contingencies and has no need for liquidity with respect to its investment in
the Shares or the Warrant Shares (to the extent that the Warrant is exercised).
The Investor recognizes that the purchase of Common Stock involves a high degree
of risk in that:

(i)                        an investment in the Corporation is highly
                           speculative and only investors who can afford the
                           loss of their entire investment should consider
                           investing in the Corporation and the Common Stock;

(ii)    an investor may not be able to liquidate his, her or its investment; and

(iii) in the event of a disposition, an investor could sustain the loss of his,
her or its entire investment.

                  4.8 Brokers. The Investor agrees to indemnify and hold
harmless the Corporation from liability for any compensation to any finder,
broker, agent, financial advisor or other intermediary retained by it in
connection with the transactions contemplated by this Agreement and the fees and
expenses of defending against such liability or alleged liability.

                  4.9      Regulation S.

                           4.9.1    Exemption from Registration  Requirements.

The Investor understands that neither the Shares the Warrant, nor the Warrant
Shares have been registered under the Securities Act, but that the Shares and
the Warrant have been issued, and the Warrant Shares shall be issued, if at all,
by the Corporation in reliance on an exemption contained in Regulation S
promulgated under the Securities Act ("Regulation S"'), and that the Corporation
is relying upon the truth and accuracy of the representations, warranties,
agreements, acknowledgments and understandings of the Investor set forth herein
in order to determine the applicability of such exemptions and the Investor's
suitability to acquire the Shares, the Warrant and the Warrant Shares.

                           4.9.2    Non-U.S. Person.

                                    4.9.2.1 Definition.  For  purposes  of  this
Agreement, a "U.S. person" shall include, without limitation, any natural person
resident in the United States, any partnership or corporation organized or
incorporated under the Laws of the United States (other than certain branches of
non-U.S. banks or insurance companies), any estate of which any executor or
administrator is a U.S. person or any trust of which any trustee is a U.S.
person (with certain exceptions) and any agency or branch of a foreign entity
located in the United States, but does not include a natural person not resident
in the United States. The "United States"' means the United States of America,
its territories and possessions, any state of the United States and the District
of Columbia.

                                    4.9.2.2 Representations  and  Warranties  as
to "U.S. Person". The Investor is not, and at the time of the Closing and/or the
exercise of the Warrant (or any part thereof) will not be, a "U.S. Person". The
Investor is not, and at the time of the Closing and/or the exercise of the
Warrant (or any part thereof) will not be, acquiring the Shares or Warrant
Shares, as the case may be, for the benefit of any U.S. Person. Upon the
Closing, the Investor will be the sole beneficial owner of the Shares, and upon
exercise of the Warrant (or any part thereof), if at all, the Investor will be
the sole beneficial owner of the Warrant Shares, and the Investor has not
pre-arranged any sale with respect to any of the foregoing to any purchaser or
purchasers in the United States.

                           4.9.3    Outside  the U.S.  The  Investor  is outside
the United States as of the date of the execution and delivery of this Agreement
and will be outside the United States at the time of the Closing and, if
applicable, at the time of exercise of the Warrant or any part thereof; provided
however that delivery of the Common Stock may be effected within the United
States through the Investor's agent as long as the Investor is outside the
United States at the time of any such delivery.

                           4.9.4    Limitation  on  Resale  &  Transferability.
The Investor understands that the Shares, the Warrant, and/or the Warrant Shares
cannot be offered for sale, sold or otherwise transferred unless pursuant to
registration under the Securities Act or pursuant to an available exemption from
registration under the Securities Act, including without limitation Regulation S
promulgated thereunder. The Investor has no present intention to sell or
otherwise transfer the Shares or the Warrant or any Warrant Shares that may be
acquired hereinafter except in accordance with the provisions of Regulation S of
the Securities Act, pursuant to registration under the Securities Act, or
pursuant to an available exemption from registration under the Securities Act.
The Investor understands that the Corporation is required, under Rule 903 of
Regulation S, to refuse to register the transfer of any of the Shares, the
Warrant or any of the warrant Shares that are not transferred pursuant to a
registration statement under the Securities Act, in compliance with Regulation S
under the Securities Act, or otherwise pursuant to an available exemption from
registration.

                           4.9.5    No  Short  Position.  The  Investor
covenants that it will not, directly or indirectly, or through one or more
intermediaries, maintain any "short" position (as hereinafter defined) in the
Common Stock during the "Distribution Compliance Period" (as hereinafter
defined). For purposes hereof, a "short position" shall mean any sale of a
security which the seller does not own or any sale which is consummated by the
delivery of a security borrowed by, or for the account of, the seller. For
purposes hereof, the "Distribution Compliance Period" shall mean the date which
is twelve months from the date of issuance.

                           4.9.6    No  Hedging  Transactions.  The  Investor
hereby agrees not to engage in any hedging transactions with regard to the
Common Stock, unless in express compliance with the provisions of Regulation S,
pursuant to registration under the Securities Act or pursuant to an exemption
from the registration requirements of the Securities Act.

                                    SECTION 5
                       REPRESENTATIONS OF THE CORPORATION

                  The Corporation represents and warrants to the Investor as
follows:

                  5.1      Due Authorization.        The  Corporation  has the
complete power to execute and deliver this Agreement, and consummate all of the
transactions contemplated hereby. The Agreement constitutes the valid and
legally binding obligations of the Corporation, enforceable against the
Corporation in accordance with its terms.

                  5.2 No Violation. Neither the execution, delivery nor
consummation of this Agreement by the Corporation, will, with the passage of
time, the giving of notice, or otherwise, result in a violation or breach of, or
constitute a default under, any term or provision of any law, rule, regulation,
order, decree, judgment, indenture, mortgage, deed of trust, lease, instrument,
contact, agreement or other restriction to which the Corporation is a party or
to which the Corporation, or the Corporation's' property is subject or bound.

                  5.3 Shares. The Shares and the Warrant, when issued, sold and
delivered in accordance with the terms hereof, for the consideration expressed
herein, will be validly issued, fully paid and nonassessable and, based in part
upon the representations of Investor in this Agreement, will be issued in
compliance with all applicable U.S. federal and state securities laws. The
Warrant Shares, when issued in accordance with the terms of the Warrant, shall
be duly and validly issued and outstanding, fully paid and nonassessable, and
based in part on the representations and warranties of Investor, will be issued
in compliance with all applicable U.S. federal and state securities laws.

                 5.4 Defaults. The Corporation is not in violation of or default
under, nor will the execution and delivery of this Agreement, the issuance of
the Shares, the Warrant or (to the extent all or any part of the warrant is
exercised) any of the Warrant Shares result in a violation of, or constitute a
default under, its certificate of incorporation or by-laws, any material
agreements or any material covenants or conditions contained in any bond,
debenture, note or other evidence of indebtedness, contract, indenture,
mortgage, loan agreement, lease, joint venture, or other agreement or instrument
to which the Corporation is a party or by which it or any of its properties may
be bound or in violation of any material order, rule, regulation, writ,
injunction, or decree of any government, governmental instrumentality, or court,
domestic or foreign.

                                    SECTION 6
                             REGISTRATION OF SHARES

The Corporation shall use its reasonable best efforts to file, at its sole
expense, a resale registration statement on Form SB-2, or other applicable form,
with the U.S. Securities and Exchange Commission (the "Commission") covering all
of the Shares no later than January 31, 2002. The Corporation shall use its
reasonable best efforts to cause such registration statement to be declared
effective in a reasonably timely manner by the Commission.

                                    SECTION 7
                                   PUT OPTION

                  7.1 Put Option. Investor shall have a right and option (the
"Put Option"), exercisable by notice to the Corporation at any time during the
period commencing upon 12:00 A.M E.S.T. on December 31, 2003 and continuing
thereafter until 5:00 P.M. E.S.T on June 30, 2004, to require the Corporation to
purchase up to two million five hundred thousand (2,500,000) of the Shares which
it then holds (the "Put Shares") for a cash purchase price of $0.20 per share.
Upon the issuance thereof, the certificates reflecting the Put Shares shall bear
a legend referencing the Put Option. The Put Option shall not be assignable to
any assignee of a the Put Shares. Notwithstanding the foregoing, the Put Option
shall automatically inure to the benefit of any Qualified Assignee with respect
to any Put Shares transferred to such Qualified Assignee. As used herein, a
"Qualified Assignee" shall mean any assignee in a private transfer of Put Shares
by Investor in compliance with the Securities Act of 1933 or an exemption
therefrom to (i) an affiliate (as defined in Rule 405 under the Securities Act
of 1933, as amended) of such Seller or (ii) any partner, shareholder or other
equity owner of Investor.

                  7.2      General  Provisions  of Put Option.  The following
provisions shall govern the closing (a "Put Closing") of the purchase by the
Corporation of any Put Shares pursuant to an exercise of the Put Option;

(i)           The Put Closing shall be held (i) at 10:00 am local time at the
              Corporation's offices on the forty-fifth (45th) business day
              following written notice of exercise of the Put Option;

(ii)        At the Put Closing,  the Corporation  and Investor (or its Qualified

               Assignee) shall be obligated to execute and deliver the
               following: (A) the Corporation shall deliver to Investor (or its
               Qualified Assignee), in immediately available funds, the total
               purchase price (as determined in accordance with the provisions
               contained in subsection (iii) of this subsection 7.2 for the Put
               Shares being purchased, (B) Investor or its Qualified Assignees
               shall execute and deliver to the Corporation (i) the certificates
               representing the Put Shares being purchased by the Corporation
               endorsed for transfer to the Corporation, free of all liens,
               claims and encumbrances and (ii) such other instruments of
               assignment, certificates of authority, tax releases, consents to
               transfer and instruments in evidence of title as may be
               reasonably required by the Corporation; and

(iii)         The per share purchase price payable upon the exercise of any Put
              Option as provided for herein shall hereafter be adjusted as may
              be necessary to reflect any stock dividends or corporate
              recapitalizations after the date hereof resulting in stock splits,
              combinations or exchanges of shares or any similar transactions.

         7.3 Early Termination of the Put Option. Notwithstanding anything to
the contrary contained herein, the Put Option shall automatically terminate
prior to its term expiration upon the occurrence of either of the following
events: (i) the consummation of an underwritten public offering of shares of the
Common Stock at an offering price per share not less than $0.40 and an aggregate
offering price of $2,000,000, or (ii) the consummation of a merger or other
business combination pursuant to which the Common Stock is valued at a price not
less than $0.40 per share and pursuant to which liquidity in respect of the
Shares and any Warrant Shares held at such time by the Investor is made
available to the Investor; provided, however, that the Investor is provided with
reasonable advance notice of any such planned occurrence and is given a
reasonable opportunity to take any steps that may be required to participate.

                                    SECTION 8
                                  MISCELLANEOUS

                  8.1 Expenses. All legal and other costs and expenses incurred
in connection with the negotiation and execution of the Agreements, and the
consummation of the transactions contemplated hereby shall be paid by the party
incurring such expenses.

                  8.2 No Assignment. This Agreement shall be binding upon the
parties, their successors and legal representatives. Except as specifically set
forth herein, this Agreement shall not be assigned by either party without the
prior written consent of the other. No permitted assignment shall relieve the
assignor of its obligations hereunder.

                  8.3 Notices. All notices and other communications hereunder
shall be given in writing and shall be deemed given when delivered personally,
or on the first attempted date of delivery after being mailed by certified or
registered mail, return receipt requested, to the parties at the addresses set
forth at the beginning of this Agreement or at such other address for a party as
shall be specified by like notice, and in the case of the Corporation with a
copy to:

                                    Membrado Montell, LLP
                                    535 West 34th Street, 2nd Floor
                                    New York, New York  10001
                                    Attn:  R. Scott Montell, Esq.

                  8.4 Counterparts. This Agreement may be executed in two or
more counterparts for the convenience of the parties hereto, each of which
executed counterparts shall be deemed an original but all of such executed
counterparts shall be considered one and the same agreement.

                  8.5 Controversy. In the event of any controversy or dispute
hereunder, the parties agree to submit the same to the courts of the State of
New York or the United States of America, sitting in the State of New York,
County of New York, and each hereby expressly submits himself or itself to the
personal jurisdiction of such courts. Each party also agrees that service of
process may be accomplished upon it or him in the same manner as the giving of
notice hereunder.

                  8.6 Severability. If any provision of this Agreement shall be
found to be unenforceable, the validity of this Agreement shall not be affected
thereby and the remaining provisions shall, as near as possible, be construed as
if such unenforceable provision was not a part of this Agreement.

                  8.7 General. This Agreement supersedes all prior agreements
between the parties, whether written or oral, and is intended as a complete and
exclusive statement of the terms of the agreements between the parties with
respect to the subject matter covered hereby and may not be changed or
terminated orally but only in a writing signed by the parties. The headings and
captions contained in this Agreement are for reference purposes only and shall
not affect, in any way, the meaning or interpretation of this Agreement. Nothing
in this Agreement, whether expressed or implied, is intended to confer upon any
other person not a party to this Agreement any rights or remedies under or by
reason of this Agreement. This Agreement has been entered into and is to be
governed by the laws of the State of New York, without regard to principles of
conflicts of laws.

         IN WITNESS WHEREOF, the parties have executed, or have caused to be
executed this Agreement as of the date first above written.

                                      SAVE ON ENERGY, INC.

                                      By:   /s/ Robert Stiles
                                         ---------------------
                                      Name:    Robert Stiles
                                      Title:    President

                                      SWI HOLDINGS, LIMITED

                                      By:   /s/ Wolfgang Wacker
                                         ----------------------
                                         Name:  Wolfgang Wacker
                                         Title:    Vice President
EXHIBIT 10.2
                               SECURITY AGREEMENT

         SECURITY AGREEMENT (this "Agreement"), made as of the 10th day of
December, 2001, by and between SAVE ON ENERGY, INC., a Georgia corporation
("Save") and SWI HOLDINGS, LIMITED, a Bermuda corporation ("SWI")(Save and SWI
may hereinafter be referred to individually as a "Party" or collectively as the
"Parties").

         WHEREAS, pursuant to a certain Stock Purchase Agreement (the "Stock
Purchase Agreement") dated December 10, 2001, by and between Save and SWI, Save
granted to SWI a certain option pursuant to which 2,500,000 common shares (the
"Put Shares") of Save could be put to Save at a purchase price of $0.20 per
share (the "Put Option"); and

         WHEREAS, it is a condition to the consummation of the transactions
contemplated under the Stock Purchase Agreement that the financial obligation of
Save underlying the Put Option be secured by (i) a first priority, senior lien
and security interest in all of the assets, tangible and intangible, of Save,
except for the assets of Alternative Energy, Inc., a New York corporation and a
wholly-owned subsidiary of Save ("AET"), and (ii) a second priority lien and
security interest in all of the assets, tangible and intangible, of AET,
subordinate only to the first priority lien on such assets held by New York
State Electric & Gas Corporation ("NYSEG").

                  NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:

         1.       Definitions.

                  (a)      The term  "Obligations"  shall mean any and all
obligations  of Save arising  under the Put Option.

                  (b) The term "Collateral" shall mean any and all tangible and
intangible assets in which Save and/or AET has or shall have an interest, now or
hereafter existing or acquired, and wherever located, together with all
additions and accessions thereto and replacements and substitutions thereof and
all proceeds and products of the foregoing.
(c) All other terms used herein which are not otherwise
defined herein and are defined in the Uniform Commercial Code of the State of
New York, or any state where Save and/or AET's assets are located, as applicable
(collectively, the "UCC"), shall have the meanings therein stated.

         2. Grant of Security Interest. Save hereby grants to SWI (i) a valid
and binding first priority, senior lien and security interest in all of the
assets, tangible and intangible, of Save, except for (a) the assets of AET and
(b) the assets with respect to which Save has granted a security interest to
Peachtree National Bank ("Peachtree") pursuant to that certain loan agreement
between Peachtree and Save and (c) that certain 2000 International Chevrolet
truck with respect to which Save has granted a security interest to The
Associates Commercial Corporation, and (ii) a valid and binding second priority
lien and security interest in (a) all of the assets, tangible and intangible, of
AET, and (b) all of the assets set forth in clauses (i)(a) and (i)(b) above,
subordinate only to the first priority liens on such assets granted by Save (the
"Security Interest") as security for the payment, performance, and observance by
Save of its obligation to purchase the Put Shares for an aggregate purchase
price of up to $500,000.

         3.       Representations and Warranties.  Save represents and warrants
to SWI as follows:
(a) Authority. The execution and delivery by Save of this
Agreement, and each of the other documents relating hereto (collectively with
this Agreement, the "Security Documents") and the performance of Save's
obligations hereunder and thereunder: (i) are within Save's corporate powers;
(ii) are duly authorized by Save's Board of Directors and stockholders, if
required; (iii) are not in contravention of the terms of Save's Certificate of
Incorporation or By-laws, or of any indenture, agreement or undertaking to which
Save is a party or by which Save or any of its assets or property is bound or
affected; (iv) do not, as of the date of execution hereof, require the consent,
approval or authorization of or declaration, registration or filing with any
governmental body or any nongovernmental person or entity (except for the filing
of the UCC-1 and other financing statements and/or this Agreement contemplated
hereby; (v) do not contravene any contractual or governmental restriction
binding upon Save; and (vi) will not, except as contemplated herein, result in
the imposition of any liens, security interests or encumbrances of any nature
whatsoever (collectively, "Liens") upon any assets or property of Save under any
existing indenture, mortgage, deed of trust, loan or credit agreement or other
agreement or instrument to which Save is a party or by which it or any of its
assets or property may be bound or affected.

                  (b) Binding Effect. The Security Documents have been duly
executed and delivered on behalf of Save and constitute the legal, valid and
binding obligations of Save enforceable against Save in accordance with their
terms.

                  (c) Full Disclosure. No representation or warranty in this
Agreement contains, or will contain, any untrue statement of any material fact
as of the date when made or omits, or will omit, to state any material fact as
of the date when made or omits, or will omit, to state any material fact
necessary to make the statements herein or therein not misleading as of the date
when made; there is no fact known to Save that has not been disclosed to SWI in
writing which materially and adversely affects or would materially and adversely
affect the business, financial condition or operations of Save.

         4.       Affirmative  Covenants.  From and  after the date  hereof  and
continuing  so long as any of the Obligations shall remain unpaid, unless SWI
shall otherwise consent in advance and in writing:

                  (a)      Perfection of Security Interest.

                           (i)      Save will, from time to time, do whatever
SWI may reasonably request by way of obtaining, executing, delivering and/or
filing financing statements, copyright mortgages, patent collateral assignments
and the like, and other notices and amendments and renewals thereof, and will
take any and all steps and observe such formalities as SWI may request, in order
to create, perfect and maintain valid continuing Liens upon the Collateral
consistent with the Security Interest and as contemplated by this Agreement.
(ii)     Save hereby irrevocably appoints SWI as its
lawful attorney-in-fact and agent, with full power of substitution, to execute
and deliver, on behalf of and in the name of Save, such financing statements,
assignments, notices, pledges and other documents and agreements, and to take
such other actions as SWI may deem reasonably necessary for the purpose of the
creation, perfection, maintenance or continuation of the Security Interest,
under any applicable law, and SWI is hereby authorized to file on behalf of and
in the name of Save, at Save's expense, such financing statements, assignments,
notices, pledges and other documents and agreements in any appropriate
governmental office. The right is expressly granted to SWI, in its discretion,
in those jurisdictions where the same is permitted, to file one or more
financing statements (including amendments and renewals thereof) under the UCC
or similar law or under federal and/or foreign patent, copyright and/or
trademark law signed only by SWI, naming Save as debtor and naming SWI as
secured party and indicating therein the types, or describing the items, of the
Collateral. This power of attorney is coupled with an interest and irrevocable
while any of the Obligations shall remain unpaid.

                  (b)      Tax Obligations.

                           (i)      Save shall file all tax and  information
returns and reports required by all applicable taxing authorities (all prepared
in accordance with applicable law), pay or cause to be paid all license fees and
related taxes and charges, and pay or cause to be paid all income, employment,
real and personal property taxes and other governmental taxes and charges
assessed against Save, or payable by Save, at such times and in such manner as
to prevent any penalty or interest from accruing thereon, or any Lien or charge
from attaching to the Collateral; provided that Save shall have the right to
contest any such fees, premiums, taxes and charges prior to the payment thereof
for so long as such contest is pursued diligently and in good faith by
appropriate proceedings.

                           (ii)     Save shall notify SWI  promptly  (and in no
event later than fifteen (15) days) after becoming aware of the intent of the
Internal Revenue Service or other taxing authority (the "Taxing Authority") to
assert a deficiency with respect to it, and shall promptly (and in no event
later than fifteen (15) days following receipt of any notice of deficiency)
inform SWI of such proposed deficiency and deliver to SWI a copy of any notices
of deficiency received from the Taxing Authority. If SWI so requests, and if
there is a reasonable legal basis therefor, Save shall take all reasonable
actions necessary to contest such claimed deficiency and shall appoint outside
tax counsel reasonably acceptable to SWI to contest such claims of deficiency
and shall direct such counsel to consult with and to provide SWI with periodic
status reports and assessments of the legal merits of the contest. At SWI's
request, such contest shall continue through the appropriate administrative and
court procedures, including appeals therefrom, until such outside tax counsel
informs Save that further contest would be inadvisable taking into account all
factors (including any settlement or compromise proposed by the Taxing
Authority).
(c) Further Assurances. Save shall at any time or from time to
time execute and deliver such further instruments and documents and take such
further action as may reasonably be requested by SWI to carry out, to SWI's
reasonable satisfaction, the transactions contemplated by Security Documents.

                  (d) Indemnification. Save shall indemnify, defend and hold
harmless SWI and its officers, directors, agents and employees from and against
all losses, costs, fines, liabilities, judgments, actions, penalties, damages,
injuries, claims, demands, disbursements and expenses, including reasonable
attorneys' fees and costs, arising out of (i) the execution or consummation of
this Agreement and the other Security Documents; (ii) the operation or
maintenance of any of the Collateral; or (iii) any aspect of, or any transaction
contemplated by or referred to in, or any matter related to, this Agreement, in
each case whether or not Save or such holder is a party thereto, except to the
extent such losses, cost, fines, liabilities, judgments, actions, penalties,
damages, injuries, claims, demands, disbursements and expenses are directly
caused by the gross negligence or willful misconduct of SWI or such holder or
their respective agents, servants or employees. Save shall assume the settlement
and defense of any suit or other legal proceeding brought to enforce any of the
foregoing (with counsel reasonably satisfactory to SWI), and shall pay all
judgments entered in any such suit or legal proceeding. Save shall not
compromise or settle any such suit or other legal proceeding without the prior
written consent of SWI, which consent shall not be unreasonably withheld or
unduly delayed. The indemnities and assumptions of liabilities and obligations
herein provided for shall continue in full force and effect notwithstanding the
termination of this Agreement.

         5.       Negative  Covenants.  From  and  after  the date  hereof,  and
continuing  so long as any of the Obligations shall remain unpaid, unless SWI
shall otherwise consent in advance and in writing:

                  (a) Liens. Save will not create or suffer to exist any Lien
upon or with respect to the Collateral which is superior in rank to the Lien
created hereby, except Liens in favor of SWI.

                  (b) Amendments. Save will not request, permit or consent to
any amendment to its Certificate of Incorporation, By-Laws or other
organizational documents, which amendment could have a material adverse effect
on the Security Interest or otherwise on SWI in its capacity as a secured party
under this Agreement.
6. Inspection and Audit. From and after the date hereof, and continuing
so long as any of the Obligations shall remain unpaid, Save will permit SWI, or
any person designated by SWI in writing, from time to time hereafter, to enter
Save's place or places of business (or any other place where the Collateral or
any information relating thereto is kept or located) during all business hours
upon not less than three (3) business days' prior notice, and, without hindrance
or delay (provided that SWI or such designees shall not unreasonably disrupt the
day-to-day operations of Save), (i) to inspect, audit, check and make copies of
and extracts from Save's books, records, journals, orders, receipts and any
correspondence and other data relating to the Collateral, the Security Interest
and the Security Documents to an extent within its own discretion, (ii) to take
such steps as Save deems reasonably necessary to verify the accuracy and
completeness of the foreoing, and (iii) to reasonably discuss any issues
relating thereto with any of SWI's officers, directors or outside auditors.
SouthWest will treat and hold as any confidential information it receives in the
course of the reviews contemplated by this Section 6, will not use any of the
confidential information except in connection with this Agreement, and, if this
Agreement is terminated for any reason whatsoever, will return to Save all
tangible embodiments (and all copies) of the confidential information which are
in its possession.

         7. Remedies on Default. Upon the occurrence of any one or more defaults
in Save's payment obligations pursuant to the Put Option, SWI shall have the
following rights and remedies in addition to all rights and remedies of a
secured party under the UCC, federal and/or foreign patent, copyright and/or
trademark law or other applicable statute or rule, in any jurisdiction in which
enforcement is sought, all such rights and remedies being cumulative and not
exclusive:

                  (a) Collateral. (i) SWI may at any time and from time to time,
with or (if and to the extent permitted by applicable law) without process of
law and with or (if and to the extent permitted by applicable law) without the
aid and assistance of others, enter upon any premises in which the Collateral or
any part thereof may be located and, without resistance or interference by Save,
take or otherwise put itself in possession of the Collateral; and/or dispose of
all or any part of the Collateral located on any premises of Save or its agents;
and/or require Save to assemble and make available to SWI all or any part of the
Collateral at any place and time reasonably designated by SWI; and/or remove all
or any part of the Collateral from any premises on which any part thereof may be
located for the purpose of effecting preservation or sale or other disposition
thereof; and/or sell, resell, lease, assign and deliver, or otherwise dispose in
good faith of, the Collateral or any part thereof in its existing condition on
commercially reasonable terms or following any commercially reasonable
preparation or processing, at public or private proceedings, in one or more
parcels at the same or different times with or without having the Collateral at
the place of sale or other disposition, for cash, upon credit or for future
delivery, and in connection therewith SWI may grant options, at such place or
places and time or times and to such persons, firms or corporations on
commercially reasonable terms as SWI deems appropriate, and without demand for
performance, and/or liquidate or dispose of the Collateral or any part thereof
in any other commercially reasonable manner. Provided notice has been given in
accordance herewith, failure of Save to contest within a reasonable period on
the grounds of commercial reasonability shall be deemed a waiver of said
defense.
                           (ii) If any of the  Collateral  is sold by SWI upon
credit or for future delivery, SWI shall not be liable for the failure of the
purchaser to pay for the same and, in the event of any such failure, SWI may, in
accordance with any applicable credit or related agreements, resell such
Collateral. SWI may buy any part or all of the Collateral at any public sale
and, if any part of the Collateral is of a type which is the subject of widely
distributed standard price quotations, SWI may buy at a private sale, all free
from any equity or right of redemption, which is hereby waived and released by
Save, and SWI may make payment therefor (by endorsement without recourse) in
notes of SWI.

                           (iii)  SWI may  apply  the  cash  proceeds  actually
received from any sale or other disposition of the Collateral in accordance
herewith to the reasonable expenses of retaking, holding, preparing for sale,
selling, leasing and the like, reasonable legal fees and expenses, court costs,
collection charges, travel and other expenses which may be incurred by SWI in
attempting to collect the Obligations or to enforce this Agreement and realize
proceeds upon conversion of the Collateral, or in the prosecution or defense of
any action or proceeding related to the subject matter of this Agreement; and
then to the Obligations in such order as to principal and/or interest due as SWI
may in its sole reasonable discretion determine; and Save shall at all times be
and remain liable and, after crediting the net proceeds of sale or other
disposition as aforesaid, will pay SWI on demand any deficiency remaining,
including interest thereon and the balance of any expenses at any time unpaid,
with any surplus to be paid to Save, subject to any duty of SWI to the holder of
any subordinate security interest in the Collateral known to SWI, but only to
the extent required by law.

                  (b) Proceeds. Any of the proceeds of the Collateral received
by Save shall not be commingled with other property of Save, but shall be
segregated, held by Save in trust for SWI as the exclusive property of SWI, and
Save will immediately deliver to SWI the identical checks, moneys or other
proceeds of Collateral received, and SWI shall have the right to endorse the
name of Save on any and all checks, or other forms of remittance received, where
such endorsement is required to effect collection. Save hereby designates,
constitutes and appoints SWI and any designee or agent of SWI as
attorney-in-fact of Save, irrevocably and with power of substitution, to endorse
the name of Save on any notes, acceptances, checks, drafts, money orders or
other evidences of payment or proceeds of the Collateral that may come into
SWI's possession; to sign the name of Save on any invoices, documents, drafts
against account debtors of Save, assignments, requests for verification of
accounts and notices to debtors of Save; to execute any endorsements,
assignments, or other instruments of conveyance or transfer; and to do all other
acts and things necessary and advisable in the sole discretion of SWI to carry
out and enforce this Agreement. Said attorney or designee shall not be liable
for any acts or commission or omission nor for any error of judgment or mistake
of fact or law. This power of attorney is coupled with an interest and
irrevocable while any of the Obligations shall remain unpaid.
8. Liability Disclaimer. Except for reasonable care of Collateral in
its possession, if any, under no circumstances whatsoever shall SWI be deemed to
assume any responsibility for, or obligation or duty with respect to, any part
or all of the Collateral, of any nature or kind whatsoever, or any matter or
proceeding arising out of or relating thereto. SWI shall not be required to take
any action of any kind to collect or protect any interest in the Collateral,
including, but not limited to, any action necessary to preserve its or Save's
rights against prior parties to any of the Collateral. SWI shall not be liable
or responsible in any way for the safekeeping, care or custody of any of the
Collateral (except for reasonable care of Collateral in its possession), or for
any loss or damage thereto, or for any diminution in the value thereof, or for
any act or default of any agent or bailee of SWI or Save, or of any carrier,
forwarding agency or other person whomsoever, or for the collection of any
proceeds, but the same shall be at Save's sole risk at all times. Save hereby
releases SWI from any claims, causes of action and demands at any time arising
out of or with respect to this Agreement or the Obligations, and any actions
taken or omitted to be taken by SWI with respect thereto, except for such
claims, causes of action, demands and/or actions directly caused by SWI's gross
negligence or willful misconduct, and Save agrees to defend and hold SWI
harmless from and with respect to any and all such claims, causes of action and
demands, except for such claims, causes of action, demands and/or actions
directly caused by SWI's gross negligence or willful misconduct. SWI's prior
recourse to any part or all of the Collateral shall not constitute a condition
of any demand for payment of the Obligations or of any suit or other proceeding
for the collection of the Obligations.

         9. Nonwaiver. No failure or delay on the part of SWI in exercising any
of its rights and remedies hereunder or otherwise shall constitute a waiver
thereof, and no single or partial waiver by SWI of any default or other right or
remedy which it may have shall operate as a waiver of any other default, right
or remedy or of the same default, right or remedy on a future occasion.

         10. Waivers. Save hereby waives presentment, notice of dishonor and
protest of all instruments included in or evidencing any of the Obligations or
the Collateral and any and all other notices and demands whatsoever (except as
expressly provided herein) whether or not relating to such instruments. In the
event of any litigation at any time arising with respect to any matter connected
with this Agreement or the Obligations, Save hereby waives the right to a trial
by jury and Save hereby waives any and all rights of setoff and rights to
interpose counterclaims of any nature except for counterclaims which are
compulsory or which would be lost for failure to be raised.

         11.      Binding  Effect.  This Agreement and all  Obligations of Save
hereunder shall be binding upon the successors or assigns of Save, and shall,
together with the rights and remedies of SWI hereunder, inure to the benefit of
SWI and its successors, endorsees and assigns.

         12. Application of Payments. In addition to its other rights herein,
SWI shall have the continuing and exclusive right to apply or reverse and
reapply any and all payments to any portion of the Obligations. To the extent
that Save makes a payment or payments to SWI or SWI receives any payment or
proceeds of any security for such Obligations for Save's benefit, which
payment(s) or proceeds or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, state
or federal law, common law or equitable cause, then, to the extent of such
payment or proceeds received, the Obligations or part thereof intended to be
satisfied shall be revived and continue in full force and effect, as if such
payment or proceeds had not been received by SWI.
13. Consent to Jurisdiction. Save agrees that (i) any state or federal
court within the State of New York shall have personal jurisdiction over Save,
and (ii) service of any summons and complaint or other process in any such
action or proceeding may be made by registered or certified mail directed to
Save at Save's address set forth below, and service so made shall be deemed to
be completed upon the earlier of actual receipt or three (3) days after the same
shall have been posted as aforesaid, Save hereby waiving personal service
thereof. Nothing in this paragraph shall affect the right of SWI to serve legal
process in any other manner permitted by law or affect the right of SWI to bring
any action or proceeding against Save or its property in the courts of any other
jurisdiction. Save and SWI agree that any claim or suit between or among the
parties hereto involving this Agreement, any of the other Security Documents or
any transactions contemplated hereby or thereby shall be brought in and decided
by the state or federal courts located in New York County, New York.

         14. Entire Agreement. This Agreement and the schedules attached hereto
constitutes the entire agreement of the parties with respect to the subject
matter hereof and there are no representations, warranties or commitments except
as set forth herein. This Agreement supersedes all prior agreements,
understandings, negotiations and discussions, whether written or oral, of the
parties hereto relating to the matters set forth in this Agreement. The
representations, warranties, covenants and agreements set forth in this
Agreement constitute all the representations, warranties, covenants and
agreements of the parties and upon which the parties have relied, shall not be
deemed waived or otherwise affected by any investigation made by any party
hereto and, except as may be specifically provided herein, no change,
modification, amendment, addition or termination of this Agreement or any part
thereof shall be valid unless in writing and signed by or on behalf of the party
to be charged therewith.

         15. Notices. Any and all notices or other communications or deliveries
required or permitted to be given or made pursuant to any of the provisions of
this Agreement shall be in writing and shall be deemed to have been duly given
or made for all purposes when hand delivered or sent by certified or registered
mail, return receipt requested and postage prepaid, overnight mail or courier,
or telecopier to the addresses set forth in the Asset Purchase Agreement or at
such other address as any party may specify by notice given to the other party
in accordance with this paragraph 15.

         16. Choice of Law; Severability. This Agreement shall be governed by,
and interpreted and construed in accordance with, the laws of the State of New
York applicable to agreements performed wholly within such state. In the event
any clause, section or part of this Agreement shall be held or declared to be
void, illegal or invalid for any reason, all other clauses, sections or parts of
this Agreement which can be effected without such void, illegal or invalid
clause, section or part shall nevertheless continue in full force and effect.

         17.      Headings.  The section  headings of this Agreement are for
convenience and reference only and do not in any way modify, interpret or
construe the intent of the parties or affect any of the provisions of this
Agreement.

                  IN WITNESS  WHEREOF,  the  undersigned  have executed this
Agreement as of the date first written above.

                                            SAVE ON ENERGY, INC.
                                            A Georgia Corporation

                                            By:  /s/ Robert Stiles
                                               --------------------
                                              Name:  Robert Stiles
                                              Title:    President

                                            SWI HOLDINGS, LIMITED
                                            A Bermuda Corporation

                                            By:   /s/ Wolfgang Wacker
                                               ----------------------
                                                Name: Wolfgang Wacker
                                                Title: Vice President