AMENDED AND RESTATED SUBLICENSE AGREEMENT

This Amended and Restated Sublicense Agreement (the “Agreement”) is made by and between H2Diesel, Inc., a Delaware corporation (hereinafter “Sublicensor”) and Xethanol Corporation, a Delaware corporation (hereinafter “Sublicensee”), as of the 15th day of June, 2006 (the “Effective Date”).

WHEREAS, Sublicensor and Sublicensee are parties to a Sublicense Agreement entered into as of the 14 ^th day of April, 2006, pursuant to which Sublicensor granted a license to Sublicensee with respect to intellectual property rights relating to a certain chemical additive for use in making bio-fuel for internal combustion engines (the “Additive”); and

WHEREAS , the parties desire to amend and restate the terms of said Sublicense Agreement effective retroactively as of the date of said Sublicense Agreement on the terms and conditions set forth herein.

    NOW, THEREFORE , in consideration of the mutual covenants and terms expressed herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Parties hereby agree, covenant, and undertake as follows:

1.   DEFINITIONS . In addition to other capitalized terms defined elsewhere herein, the following terms as used in this Agreement shall have the meanings set forth below:

“ Actual Cost ” shall be the price per applicable quantity unit of the Additive which shall be equal to Sublicensor’s actual cost of raw materials used in making that quantity of the Additive as determined in accordance with generally accepted accounting principles (“GAAP”), plus ten percent (10%). As of the date of this Agreement Sublicensor’s actual cost of the raw materials for the Additive in solid form is not more than 10 cents ($0.10) per Gallon of biodiesel fuel producible in accordance with the blending formulations currently forming part of the Know-How to be provided to Sublicensee under this Agreement.

“ Affiliate ” shall mean any person or entity directly or indirectly Controlling or having the power to Control, or Controlled by or being under common Control with another person or entity.

“ Consolidated Entity ” shall mean an entity the financial results of which are consolidated with those of Sublicensor for financial accounting purposes in accordance with GAAP.

“Control” means the direct or indirect possession of power to direct or cause the direction of the management or policies of such party, whether through ownership of stock or other securities, by contract or otherwise. Ownership of more than fifty percent (50%) of the beneficial interest of an entity shall be conclusive evidence that control exists.

“Exclusive License Agreement” means the Exclusive License Agreement between Ferdinando Petrucci as Licensor and Sublicensor as Licensee, dated March 28, 2006.

“ Gallon” shall mean a liquid unit equal to 4 quarts or 3.785 liters.

“ Improvement ” shall mean any enhancement, refinement, discovery, invention, trade secret or additional technology, whether patentable or non-patentable under the laws of any country (including, without limitation, any test or other proprietary data, experience, methods, processes, know-how, new apparatus, equipment, machinery, Products, specifications, designs and information) of or related to the

Know-How licensed hereunder, the Additive or any Product developed, conceived or otherwise arising after the date hereof.

“ Know-How ” shall mean technical information, including without limitation trade secrets, whether or not patentable, relating to, used in, or useful in connection with, the use of the Additive for production of a Product (as defined below) for internal combustion engines, including, without limitation, suggested chemical plant configurations, plans and formulation(s) for blending of the Additive with other raw materials to create a Product.

“ License ” shall mean the license granted in Section 2 hereof.

    “Licensor” means Ferdinando Petrucci.

“ Patent Rights ” shall mean all claims of such patent applications and issued patents that are directed to the Additive, production of the Additive, Know-How or Improvements (each as defined herein) hereafter filed or issued to which Sublicensor may acquire rights during the term of this Agreement.

“ Product(s) ” shall mean any fuel or chemical which is manufactured using the Additive.

“Specifications” shall mean the specifications applicable to the use of the Additive to produce Products and the performance of those Products, as proposed by Sublicensor in good faith and reasonably agreed to by Sublicensee from time to time. The Specifications shall at all times reflect the best commercial product being delivered by Sublicensor to Sublicensee or any other party or being used by Sublicensor for its own account.

             “ Territory ” shall mean the geographic areas defined in Annex A.

2.   SUPPLY OF THE ADDITIVE FOR USE IN PRODUCTION OF PRODUCTS;   GRANT OF SUBLICENSE

2.1   Sublicensor agrees to supply the Additive to Sublicensee for use solely in manufacturing Products made with the Additive blended therein while this Agreement is in effect. The parties acknowledge and agree that the Additive as well as Products utilizing the Additive have not yet been mass produced by either party and that therefore the parties will work cooperatively so that as Sublicensee’s capacity to produce Products is established and increases over time, Sublicensor can increase its capacity to produce sufficient quantities of the Additive to supply Sublicensee’s requirements for same. In furtherance thereof, Sublicensee shall inform Sublicensor when Sublicensee commences construction of manufacturing facilities for Products as well as the timeframe for such facilities to commence production of Products and will notify Sublicensor reasonably in advance of such facilities actually commencing production of Products to enable Sublicensor to coordinate its production capacity for the Additive accordingly to meet Sublicensee’s supply needs for same. Additionally, Sublicensee shall thereafter notify Sublicensor reasonably in advance of any increases in its Product production capacity to enable Sublicensor to increase its Additive production capacity such that Sublicensor can maintain a level of Additive production capacity sufficient to supply one hundred ten percent (110%) of Sublicensee’s needs for supply of the Additive. Subject to such cooperation, Sublicensor agrees to supply all of the Additive required to fill all of Sublicensee’s orders for same; provided, however, that, unless Sublicensor determines otherwise, in no event shall orders for the Additive be made or accepted until Sublicensor (or its designated supplier) has commenced manufacturing of the Additive and all required regulatory and other legal approvals and requirements have been obtained and/or satisfied. Quantities of

the Additive to be supplied to Sublicensee shall be confirmed to Sublicensee after the receipt by Sublicensor of a purchase order for same from Sublicensor shall undertake commercially reasonable efforts to fill orders within the timeframe specified in such order; provided, however, that Sublicensor shall not have any liability for failure to ship orders for the Additive within such timeframe due to circumstances beyond its control. The purchase price for the Additive to be paid by Sublicensee shall be equal to the lesser of (a) Sublicensor’s then current Actual Cost or (b) the lowest price charged by Sublicensor to any other third party purchaser of Additive which is not an affiliate of Sublicensor, unless (c) another price is determined by mutual agreement of Sublicensor and Sublicensee. In addition to the applicable purchase price, Sublicensor shall be entitled to separately invoice for, and Sublicensee shall pay, all sales, use, excise, value added, gross receipts, turnover and other taxes and charges imposed by law or required to be paid or collected by Sublicensor in connection with the purchase, delivery, sale or use of the Additive pursuant to this Agreement, excluding taxes based on Sublicensor’s net income. All payments relating to purchases of the Additive shall be due to Sublicensor from Sublicensee within thirty (30) days after the date on which the ordered Additive is shipped to Sublicensee. Payments shall be made by check or wire transfer or as otherwise specified by Sublicensor in the invoice for the applicable shipment. Each order shall constitute an independent transaction and Sublicensee shall pay the invoice for each such transaction strictly in accordance with these payment terms. All orders for the Additive shall be deemed to incorporate the warranty disclaimers, limitations of liability and other applicable terms of this Agreement, and shall be nonreturnable and the price paid nonrefundable unless the Additive does not meet the Specifications for the Additive in effect at the time of order. Sublicensee shall designate the shipping method and pay all costs incurred in connection with shipment of the Additive to Sublicensee’s designated destination, including the cost of the shipper and any in transit insurance (which shipping costs shall be paid directly by Sublicensee and not as reimbursement to Sublicensor). Risk of loss with respect to orders of the Additive purchased and sold hereunder shall pass to Sublicensee at the time that the order is deposited with Sublicensee’s designated shipper. No less often than every calendar quarter while this Agreement is in effect, Sublicensee shall provide to Sublicensor forecasts of Sublicensee’s anticipated Additive purchase requirements. Without Sublicensor’s prior written consent or unless Sublicensor fails to fulfill its obligations to provide Additive pursuant to this Agreement, Sublicensee may not procure the Additive from any third party other than Sublicensor or a Sublicensor designated supplier or produce the Additive.

2.2   Subject to the terms and conditions of this Agreement, Sublicensor hereby grants to Sublicensee while this Agreement in effect, a non-transferable, exclusive license, with no right to grant sub-sublicenses other than to (a) any holding company formed to hold all of the equity interests in Sublicensor and any wholly owned subsidiaries of Sublicensee or such holding company and (b) entities in which it has an equity interest (determined in accordance with GAAP) of not less than twenty percent (20%) and which are not competitors of Sublicensor (it being understood that an entity that produces Product using the Additive and sells such Product shall not be deemed by reason thereof to be a competitor of Sublicensor),   provided that any such holding company, subsidiary or other entity agrees in writing to observe all of the obligations and limitations set forth under this Agreement, including the payment of Royalties, and Sublicensee guarantees performance of such obligations by such other party, under the Patent Rights and under the Know-How to make, cause to be made, use and sell any Product in the Territory and the non-exclusive right to sell any Product anywhere else within North America, namely, the United States of America, its possessions and territories, Canada and Mexico), Central America (namely, Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama), and Caribbean countries (namely, Antigua & Barbuda, Aruba, Bahamas, Cayman Islands, Cuba (currently subject to U.S. embargo), Dominica, Dominican Republic, Grenada, Guadeloupe, Haiti, Jamaica, Martinique, St. Kitts & Nevis, St. Lucia, St. Vincent and the Grenadines, Trinidad & Tobago, Turks & Caicos Islands, and Virgin Islands). Sublicensee shall not engage any third party to make any Product without the prior written approval of Sublicensor, which approval shall not be withheld or delayed unreasonably, and shall not directly or indirectly re-sell the Additive or any Product which has the

Additive as a component outside the Territory. In the event that Sublicensor acquires rights in South America under Section 1(c) of the License, the permitted non-exclusive resale territory shall be expanded to include South America (namely, Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, French Guiana, Guyana, Peru, Suriname, Uruguay and Venezuela), but specifically excluding Paraguay.

Sublicensee shall undertake reasonable efforts to ensure compliance with the foregoing restrictions, including, without limitation, imposing contractual restrictions in connection with its sale of Products to third parties. Sublicensee shall handle and treat all Know-How provided hereunder with the highest degree of secrecy and care in accordance with the requirements of Section 18.8 hereof. Sublicensee shall not reproduce or provide access to any of the Know-How to any person except as necessary to perform its obligations hereunder, or in the exercise of its right to engage others to make the Product if approved by Sublicensor as provided above, and any such person receiving disclosure of any Know-How pursuant hereto shall be required to comply with the confidentiality obligations imposed herein with respect to same, with Sublicensee remaining fully responsible for such compliance. Sublicensee shall not directly or indirectly reverse engineer, attempt to reverse engineer or otherwise attempt to derive the formula or other trade secrets with respect to the Additive, or assist or permit others to do so.

2.3   Sublicensor shall use its commercially reasonable efforts on a continual basis throughout the term of this Agreement to make Improvements to the Additive and shall use all such improvements that result in an improvement in the Additive or the performance of the Product in the production of the Additive.

2.4   Sublicensee shall be jointly and severally obligated with Sublicensor and liable to Licensor for all of the obligations of Sublicensor to pay royalties under the Exclusive License Agreement, to the extent that such obligations arise from the exercise by Sublicensee of the rights granted to it in this Agreement; provided, however, that Sublicensee shall have no obligation to make any payments to Licensor in excess of the unpaid Royalty payments due from Sublicensee to Sublicensor at the relevant time.

2.5   This Agreement creates no relationship of partnership, joint venture, employment, franchise, or agency between the parties. This Agreement shall not constitute the designation of either party as the representative or agent of the other, nor shall either party to this Agreement have the right or authority to make any promise, guarantee, warranty, or representation, or to assume, create, or incur any liability or other obligation of any kind, express or implied, against or in the name of, or on behalf of, the other party, without the other party’s prior written consent and approval.

2.6   Sublicensee agrees not to contest, challenge or attack the ownership of the intellectual property rights relating to the Additive, the Know-How or anything else provided by Sublicensor hereunder, or Sublicensor's right to grant licenses or sublicenses to use same on whatever terms and conditions acceptable to Sublicensor in its sole and absolute discretion, or assist others in doing any of same.

3.   ROYALTIES

3.1   In consideration of the grant of license hereunder, Sublicensee agrees to pay to Sublicensor a royalty per Gallon of Product sold directly or indirectly by or through Sublicensee, its agents, affiliates, subsidiaries and permitted sub-sublicensees, equal to the lesser of (a) ten U.S. cents ($0.10) and (b) the lowest royalty per Gallon of Product that is charged as a royalty to any other third party that is not a Consolidated Entity, which third party is licensed or otherwise authorized to make or sell any fuel or chemical using the Additive (the “Royalties”).

3.2   In the first twelve (12) months from the date on which (a) Sublicensor notifies Sublicensee that it is able to produce and deliver to Sublicensee Additive conforming to the Specifications in quantities that are necessary to meet Sublicensee’s requirements (and provided that Sublicensor is in fact then able to do so), and (b) Sublicensor provides Sublicensee with the necessary technical and engineering specifications for a process plant to produce the Products (the “Trigger Date”), Sublicensee shall be obligated to pay Royalties with respect to at least twenty million (20,000,000) Gallons of Products (the “Initial Mandatory Minimum Sales”). The mandatory minimum sales with respect to which Royalties are required to be paid shall increase by ten million (10,000,000) Gallons of Products for each subsequent twelve (12) month period following the first anniversary of the Trigger Date while this Agreement is in effect as compared to the mandatory minimum for the immediately prior twelve (12) month period (the “Follow-On Mandatory Minimum Sales”). For example, the Follow-On Mandatory Minimum Sales for the twelve (12) month period commencing twelve (12) months after the Trigger Date shall be thirty million (30,000,000) Gallons of Products, and so on. Sublicensee’s obligation to pay Royalties on the Initial Mandatory Minimum Sales is irrevocable, whether or not Sublicensee actually achieves such Initial Mandatory Minimum Sales. In the event that Sublicensee fails to achieve the Initial Mandatory Minimum Sales requirement or the Follow-On Mandatory Minimum Sales requirements in any period during the first two (2) twelve (12) month periods after the first anniversary of the Trigger Date, Sublicensor shall have the right, at its option, to either terminate this Agreement and Sublicensee’s rights hereunder or convert Sublicensee’s exclusive rights hereunder to non-exclusive rights (in addition to its right to payment of the Royalties payable on the Initial Mandatory Minimum Sales) unless Sublicensee shall pay the difference between the amount of Royalties actually due for such period under this Agreement and the amount of Royalties that would have been due had Sublicensee sold the minimum amounts required as set forth above during such period, within the time provided herein for payment of Royalties for such period (the “Cure Right”). In the event that Sublicensee fails to achieve the Follow-On Mandatory Minimum Sales for the fourth twelve (12) month period after the Trigger Date or any subsequent twelve (12) month period while this Agreement is in effect, Sublicensee’s exclusive rights shall automatically be converted to non-exclusive, unless Sublicensee exercises the Cure Right with respect thereto. If Sublicensee shall elect, in its sole discretion, not to exercise the Cure Right with respect to a failure to achieve the Follow-On Mandatory Minimum Sales for any twelve (12) month period after the first two (2) twelve (12) month periods after the first anniversary of the Trigger Date, then the obligation of Sublicensee to pay Royalties based upon Follow-On Mandatory Minimum Sales for any subsequent period, commencing with the period as to which the Cure Right was not exercised, shall also terminate.

3.3   All Royalties shall be paid by Sublicensee to Sublicensor on a quarterly basis, with all Royalties payable with respect to sales of Products in a particular calendar quarter due within thirty (30) days after the end of the calendar quarter in which sales of Products caused such Royalties to be accrued. Royalty amounts not paid when due shall accrue interest at the rate of one and one-half percent (1 1/2%) per month or the highest rate permitted by law, whichever is less, until paid in full. Each such payment shall be accompanied by an accounting statement, which shall include:

     (i) the quantity of Products sold; and

     (ii) the total of all Royalties payable to Sublicensor.

3.4   Sublicensee shall keep proper books of account showing sales of Products. Sublicensor's designated auditing firm shall have access to the books and records of Sublicensee once per twelve (12) month period to independently determine the amount of Royalties payable hereunder, but for no other purpose. All information obtained by Sublicensor and its auditing firm shall be kept strictly confidential by Sublicensor and its auditing firm; provided that such information may be used by

Sublicensor and its counsel in enforcing its rights under this Agreement. In the event that an underpayment of Royalties in excess of five percent (5%) of the total Royalties that should have been paid is determined to have occurred, Sublicensee shall promptly pay to Sublicensor the amount of the deficiency together with interest accrued thereon, as well as the expenses incurred by Sublicensor in connection with verifying Royalty payments pursuant hereto.

4.   RETENTION OF RIGHTS . Notwithstanding any other provisions herein, Licensor, Sublicensor and Sublicensor's other sublicensees will have the absolute, right to use the technology covered by the Patent Rights and Know-How and all Improvements thereof, for conducting research and for any other purposes permitted pursuant to the Exclusive License Agreement or any valid sublicense agreements.

5.   OWNERSHIP OF IMPROVEMENTS;   PATENT PROSECUTION .   Sublicensee acknowledges and agrees that, except as otherwise expressly provided below, Sublicensor shall own the intellectual property rights with respect to any Improvements that are developed by or for Sublicensee. In the event that Sublicensee, or any person employed or engaged by Sublicensee (including any person employed or engaged by any entity engaged by Sublicensee), develops or creates Improvements, Sublicensee promptly shall offer to, and upon Sublicensor’s acceptance, shall assign, or shall cause any and all such persons to grant back and assign, to Sublicensor or Sublicensor’s designated Affiliate, free of charge, all rights of ownership in such Improvements, whether such Improvements are patentable or non-patentable under the laws of any country. Sublicensee shall retain a right to use such Improvements solely in accordance with the license and other terms of this Agreement, provided that Sublicensee treats the Improvements with the same obligations of secrecy and care