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                                 AMENDMENT NO. 1

                                       to

                                RIGHTS AGREEMENT

                                     Between

                            BEACON POWER CORPORATION

                                       and

                          Equiserve Trust COMPANY, N.A.



                          Dated as of December 27, 2002


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     AMENDMENT  NO. 1 DATED AS OF  DECEMBER  27, 2002 TO RIGHTS  AGREEMENT  (the
"Agreement"),  dated as of September 25, 2002, between Beacon Power Corporation,
a Delaware  corporation (the "Company"),  and EquiServe Trust Company,  N.A., as
Rights Agent (the "Rights Agent").

     The board of directors  of the Company has resolved to amend the  Agreement
by  increasing  the  percentage  of the  Company's  Common  Shares that  Perseus
Capital,   L.L.C.  and  Persons  who  are  Beneficial  Owners  through  it  must
Beneficially  own in order to be considered an Acquiring Person from 30% to 35%.
This  amendment  is to  memorialize  that  resolution  and amend  the  Agreement
pursuant to Section 27 of the Agreement.

     In  consideration  of the  premises  and the mutual  agreements  herein set
forth, the parties hereby agree as follows:

     SECTION 1 Amendments The  definition of "Acquiring  Person," which is found
in Section 1(a) of the  Agreement,  shall be amended by replacing  "30%" each of
the eight  times it appears  (in lines 3, 10, 15, 26, 35, 46, 48, and 55 of said
definition) with "35%."

     In the  fourth  line of the  second  full  paragraph  of  Exhibit  C to the
Agreement, "30%" shall be changed to "35%."

     In all other  respects,  the Agreement  shall remain  unchanged and in full
force and effect.

     SECTION 2 Definitions  Capitalized  terms used but not defined herein shall
have the meanings given to them in the Agreement.








     IN WITNESS WHEREOF,  the parties hereto have caused this Amendment No. 1 to
the Agreement to be duly executed and delivered on January __, 2003 effective as
of December 27, 2002.

                                       Beacon Power Corporation

                                       by


                                       Name:
                                       Title:





                                       by


                                       Name:
                                       Title:



                                       EQUISERVE TRUST COMPANY, N.A.


                                       by


                                       Name:
                                       Title: