STATE OF DELAWARE
                                                           SECRETARY OF STATE
                                                        DIVISION OF CORPORATIONS
                                                       FILED 06:00 PM 11/03/1999
                                                          991468356 -- 2607851

                                     AMENDED
                           CERTIFICATE OF DESIGNATION
                                       OF
                      SERIES E CONVERTIBLE PREFERRED STOCK
                                       OF
                      COMMODORE APPLIED TECHNOLOGIES, INC.
                ------------------------------------------------
                         Pursuant to Section 151 of the
                General Corporation Law of the State of Delaware

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

            Commodore Applied Technologies, Inc., a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
"CORPORATION"), hereby certifies that the following resolutions were adopted by
the Board of Directors of the Corporation on November 3, 1999 pursuant to
authority of the Board of Directors as required by Section 151 of the General
Corporation Law of the State of Delaware:

            RESOLVED, that pursuant to the authority granted to and vested in
the Board of Directors of this Corporation (the "BOARD OF DIRECTORS" or the
"BOARD") in accordance with the provisions of its Certificate of Incorporation,
the Board of Directors hereby amends the Certificate of Designation of Series E
Convertible Preferred Stock of the Corporation authorizing a series of the
Corporation's previously authorized Preferred Stock, par value $0.001 per share
(the "PREFERRED STOCK"), and hereby amends the designation and the number of
shares, and fixes the relative rights, preferences, privileges, powers and
restrictions thereof as follows:

            Series E Convertible Preferred Stock:

                                    ARTICLE 1
                                   DEFINITIONS

            The terms defined in this Article whenever used in this Certificate
of Designation have the following respective meanings:

            (a) "ADDITIONAL CAPITAL SHARES" has the meaning set forth in Section
6.1(c).

            (b) "AFFILIATE" has the meaning ascribed to such term in Rule 12b-2
under the Securities Exchange Act of 1934, as amended.

            (c) "AMEX" means The American Stock Exchange.

            (d) "BUSINESS DAY" means a day other than Saturday, Sunday or any
day on which banks located in the State of New York are authorized or obligated
to close.

            (e) "CAPITAL SHARES" means the Common Shares and any other shares of
any other class or series of common stock, whether now or hereafter authorized
and however designated, which have the right to participate in the distribution
of earnings and assets (upon dissolution, liquidation or winding-up) of the
Corporation.

<PAGE>

            (f) "COMMON SHARES" or "COMMON STOCK" means shares of common stock,
par value $0.001 per share, of the Corporation.

            (g) "COMMON STOCK ISSUED AT CONVERSION", when used with reference to
the securities issuable upon conversion of the Series E Preferred Stock, means
all Common Shares now or hereafter Outstanding and securities of any other class
or series into which the Series E Preferred Stock hereafter shall have been
changed or substituted, whether now or hereafter created and however designated.

            (h) "CONVERSION DATE" means any day on which all or any portion of
shares of the Series E Preferred Stock is converted in accordance with the
provisions hereof.

            (i) "CONVERSION NOTICE" means a written notice of conversion
substantially in the form annexed hereto as Annex I.

            (j) "CONVERSION PRICE" means any date of determination the
applicable price for the conversion of shares of Series E Preferred Stock into
Common Shares on such day as set forth in Section 6.1.

            (k) "CORPORATION" means Commodore Applied Technologies, Inc., a
Delaware corporation, and any successor or resulting corporation by way of
merger, consolidation, sale or exchange of all or substantially all of the
Corporation's assets, or otherwise.

            (l) "CURRENT MARKET PRICE" means any date of determination the
closing price of a Common Share on such day as reported on the Amex; provided,
if such security is listed and admitted to trading on the NASDAQ, the closing
bid price of a Common Share on such day as reported on the NASDAQ, or, if not
quoted or listed or admitted to trading on any national securities exchange or
quotation system, the closing bid price of such security on the over-the-counter
market on the day in question as reported by Bloomberg LP, or a similar
generally accepted reporting service, as the case may be.

            (m) "DEFAULT DIVIDEND RATE" is equal to the Dividend Rate plus an
additional 4% per annum.

            (n) "DIVIDEND PERIOD" means the quarterly period commencing on and
including the Issue Date or, if a dividend has previously been paid, the day
after the immediately preceding Dividend Payment Due Date and ending on and
including the immediately subsequent Dividend Payment Due Date.

            (o) "DIVIDEND PAYMENT DUE DATE" means March 31, June 30, September
30 and December 31 of each year.

            (p) "DIVIDEND RATE" means 12% per annum, computed on the basis of a
360-day year up to and including April 30, 2000 and thereafter 5% per annum,
computed on the basis of a 360-day period.

                                       -2-

<PAGE>

            (q) "HOLDER" means The Share Fund Ltd., any successor thereto, or
any Person or Persons to whom the Series E Preferred Stock is subsequently
transferred in accordance with the provisions hereof.

            (r) "ISSUE DATE" means, as to any share of Series E Preferred Stock,
the date of issuance of such share.

            (s) "JUNIOR SECURITIES" means all capital stock of the Corporation
except for the Series E Preferred Stock.

            (t) "LIQUIDATION PREFERENCE" means, with respect to a share of the
Series E Preferred Stock, an amount equal to the sum of (i) the Stated Value
thereof, plus (ii) an amount equal to 30% of such Stated Value, plus (iii) the
aggregate of all accrued and unpaid dividends on such share of Series E
Preferred Stock until the most recent Dividend Payment Due Date; provided that,
in the event of an actual liquidation, dissolution or winding up of the
Corporation, the amount referred to in clause (iii) above shall be calculated by
including accrued and unpaid dividends to the actual date of such liquidation,
dissolution or winding up, rather than the Dividend Payment Due Date referred to
above.

            (u) "MANDATORY CONVERSION DATE" has the meaning set forth in Section
6.8.

            (v) "MARKET PRICE" per Common Share means the arithmetic mean of the
closing prices of Common Shares as reported on the Amex for the ten Trading Days
during any Valuation Period; provided, if such security is listed and admitted
to trading on the NASDAQ, the closing bid price of a Common Share on such day as
reported on the NASDAQ, or, if not quoted or listed or admitted to trading on
any national securities exchange or quotation system, the closing bid price of
such security on the over-the-counter market on the day in question reported by
Bloomberg LP, or a similar generally accepted reporting service, as the case may
be.

            (w) "NASDAQ" means Nasdaq National Market or the Nasdaq SmallCap
Market, as the case may be.

            (x) "OPTIONAL REDEMPTION PRICE" has the meaning set forth in Section
6.5.

            (y) "OUTSTANDING", when used with reference to Common Shares or
Capital Shares (collectively, "SHARES"), means, on any date of determination,
all issued and outstanding Shares, and includes all such Shares issuable in
respect of outstanding scrip or any certificates representing fractional
interests in such Shares; provided, however, that any such Shares directly or
indirectly owned or held by or for the account of the Corporation or any
Subsidiary of the Corporation shall not be deemed "OUTSTANDING" for the purposes
hereof.

            (z) "PERSON" means an individual, a corporation, a partnership, an
association, a limited liability company, an unincorporated business
organization, a trust or other entity or organization, and any government or
political subdivision or any agency or instrumentality therof.

            (aa) "REDEMPTION DATE" has the meaning set forth in Section 6.5.

                                       -3-

<PAGE>

            (bb) "REGISTRATION RIGHTS AGREEMENT" means that certain Registration
Rights Agreement dated a date even herewith between the Corporation and The
Shaar Fund Ltd.

            (cc) "SEC" means the United States Securities and Exchange
Commission.

            (dd) "SECURITIES ACT" means the Securities Act of 1933, as amended,
and the rules and regulations of the SEC thereunder, all as in effect at the
time.

            (ee) "SECURITIES PURCHASE AGREEMENT" means that certain Securities
Purchase Agreement dated as of a date even herewith between the Corporation and
The Shaar Fund Ltd.

            (ff) "SERIES E PREFERRED SHARES" or "SERIES E PREFERRED STOCK" means
the shares of Series E Convertible Preferred Stock of the Corporation or such
other convertible Preferred Stock exchanged therefor.

            (gg) "STATED VALUE" has the meaning set forth in Article 2.

            (hh) "SUBSIDIARY" means any entity of which securities or other
ownership interests having ordinary voting power to elect a majority of the
board of directors or other persons performing similar functions are owned
directly or indirectly by the Corporation.

            (ii) "TRADING DAY" means any day on which purchases and sales of
securities authorized for quotation on the Amex are reported thereon and on
which no event which results in a material suspension or limitation of trading
of the Common Shares on the Amex has occurred.

            (jj) "VALUATION EVENT" has the meaning set forth in Section 6.1.

            (kk) "VALUATION PERIOD" means the period of ten Trading Days
immediately preceding the Conversion Date or in the case of a Valuation Period
utilized for the purpose of Section 4(a)(iii) hereof, Valuation Period shall
mean the date of payment of a dividend in Common Stock; provided, however, that
if a Valuation Event occurs during a Valuation Period on a date less than five
Trading Days before the Conversion Date, the Valuation Period shall be extended
until the date five Trading Days after the occurrence of the Valuation Event.

            All references to "CASH" or "$" herein means the currency of the
United States of America.

                                   ARTICLE 2
                             DESIGNATION AND AMOUNT

            The designation of this series, which consists of 335,000 shares of
Preferred Stock, shall be Series E Convertible Preferred Stock (the "SERIES E
PREFERRED STOCK") and the stated value shall be $10 per share (the "STATED
VALUE").

                                      -4-

<PAGE>

                                   ARTICLE 3
                                      RANK

            The Series E Preferred Stock shall rank prior to any other capital
stock of the Corporation.

                                   ARTICLE 4
                                   DIVIDENDS

                (a)(i) The Holder shall be entitled to receive, out of funds
      legally available for the payment of dividends, (x) dividends at the
      Dividend Rate on the Stated Value of each share of Series E Preferred
      Stock on and as of each Dividend Payment Due Date with respect to each
      Dividend Period and, in addition, (y) a special dividend (the "SPECIAL
      DIVIDEND") at the rate of 7.5% per annum (computed on the basis of a
      360-day year) on the Stated Value of each share of Series E Preferred
      Stock which shall accrue commencing on May 1, 2000 until and including the
      date of payment thereof and shall be due and payable on May 1, 2001;
      provided, however, that no Special Dividend shall be paid in respect of
      any share of Series E Preferred Stock which is converted into Common Stock
      pursuant to Article 6 on or before April 30, 2001; and provided, further,
      that if (X) any dividend which is not a Special Dividend is not paid in
      full on any Dividend Payment Due Date or (Y) the Special Dividend is not
      paid in full on May 1, 2001, dividends shall thereafter accrue and be
      payable at the Default Dividend Rate on the Stated Value of each share of
      Series E Preferred Stock until all accrued dividends are paid in full.
      Dividends on the Series E Preferred Stock shall be cumulative from the
      date of issue, whether or not declared for any reason, including if such
      declaration is prohibited under any outstanding indebtedness or borrowings
      of the Corporation or any of its Subsidiaries, or any other contractual
      provision binding on the Corporation or any of its Subsidiaries, and
      whether or not there shall be funds legally available for the payment
      thereof.

                  (ii) Each dividend shall be payable in equal quarterly amounts
      on each Dividend Payment Due Date, commencing December 31, 1999, to the
      Holders of record of shares of the Series E Preferred Stock, as they
      appear on the stock records of the Corporation at the close of business on
      such record date, not more than 60 days or less than 10 days preceding the
      payment dates thereof, as shall be fixed by the Board of Directors.
      Accrued and unpaid dividends for any past Dividend Period may be declared
      and paid at any time, without reference to any Dividend Payment Due Date,
      to Holders of record, not more than 15 days preceding the payment date
      thereof, as may be fixed by the Board of Directors.

                  (iii) Dividends due hereunder shall be payable in cash;
      provided, however, that with respect to dividends due after May 1, 2000,
      at the option of the Corporation, such dividends shall be paid either (x)
      in cash or (y) through the issuance of duly and validly authorized and
      issued, fully paid and nonassessable, freely tradable shares of the Common
      Stock valued at the Market Price and registered for resale in the open
      market transactions on the Registration Statement (as defined in the
      Registration Rights Agreement), which Registration Statement shall then be
      effective under the

                                      -5-

<PAGE>

      Securities Act; provided, further, that if no funds are legally available
      for the payment of cash dividends on the Series E Preferred Stock,
      dividends shall be paid as provided in clause (y) above. Notwithstanding
      the foregoing, until such Registration Statement has been declared
      effective under the Securities Act by the SEC, payment of dividends on the
      Series E Preferred Stock shall be in cash.

            (b) Except as provided in Section 4(d) hereof, the Holder shall not
be entitled to any dividends in excess of the cumulative dividends, as herein
provided, on the Series E Preferred Stock.

            (c) So long as any shares of the Series E Preferred Stock are
outstanding, no dividends shall be declared or paid or set apart for payment or
other distribution declared or made upon any Junior Securities, nor shall any
Junior Securities be redeemed, purchased or otherwise acquired (other than a
redemption, purchase or other acquisition of shares of Common Stock made for
purposes of an employee incentive or benefit plan (including a stock option
plan) of the Corporation or any Subsidiary), for any consideration by the
Corporation, directly or indirectly, nor shall any moneys be paid to or made
available for a sinking fund for the redemption of any shares of any Junior
Securities, unless in each case (i) the full cumulative dividends required to be
paid in cash on all outstanding shares of the Series E Preferred Stock shall
have been paid or set apart for payment for all past Dividend Periods with
respect to the Series E Preferred Stock and (ii) sufficient funds shall have
been paid or set apart for the payment of the dividend for the current Dividend
Period with respect to the Series E Preferred Stock.

            (d) If the Corporation shall at any time or from time to time after
the Issue Date declare, order, pay or make a dividend or other distribution
(including, without limitation, any distribution of stock or other securities or
property or rights or warrants to subscribe for securities of the Corporation or
any of its Subsidiaries by way of dividend or spin-off) on shares of its Common
Stock, then, and in each such case, in addition to the dividend obligation of
the Corporation specified in paragraph (a) of this Article 4, the Corporation
shall declare, order, pay and make the same dividend or distribution to each
Holder of Series E Preferred Stock as would have been made with respect to the
number of Common Shares the Holder would have received had it converted all of
its Series E Preferred Shares, and exercised the Warrant held by it in full for
all the Common Shares then underlying the Warrant, immediately prior to such
dividend or distribution.

                                   ARTICLE 5
             LIQUIDATION PREFERENCE; MERGERS, CONSOLIDATIONS, ETC.

            (a) If the Corporation shall commence a voluntary case under the
Federal bankruptcy laws or any other applicable Federal or state bankruptcy,
insolvency or similar law, or consent to the entry of an order for relief in an
involuntary case under any law or to the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or other similar official) of the
Corporation or of any substantial part of its property, or make an assignment
for the benefit of its creditors, or admit in writing its inability to pay its
debts generally as they become due, or if a decree or order for relief in
respect of the Corporation shall be entered by a court having jurisdiction in
the premises in an involuntary case under the Federal bankruptcy

                                      -6-

<PAGE>

laws or any other applicable Federal or state bankruptcy, insolvency or similar
law resulting in the appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or other similar official) of the Corporation or of any
substantial part of its property, or ordering the winding up or liquidation of
its affairs, and any such decree or order shall be unstayed and in effect for a
period of 30 consecutive days and, on account of any such event, the Corporation
shall liquidate, dissolve or wind up, or if the Corporation shall otherwise
liquidate, dissolve or wind up, no distribution shall be made to the holders of
any shares of capital stock of the Corporation upon liquidation, dissolution or
winding-up unless prior thereto, the Holders of shares of Series E Preferred
Stock, subject to this Article 5, shall have received the Liquidation Preference
with respect to each share.

            (b) In case the Corporation shall reorganize its capital, reclassify
its capital stock, consolidate or merge with or into another Person (where the
Corporation is not the survivor or where there is a change in or distribution
with respect to the Common Stock of the Corporation), sell, convey, transfer or
otherwise dispose of all or substantially all its property, assets or business
to another Person, or effectuate a transaction or series of related transactions
in which more than 50% of the voting power of the Corporation is disposed of
(each a "FUNDAMENTAL CORPORATE CHANGE") and, pursuant to the terms of such
Fundamental Corporate Change, shares of common stock of the successor or
acquiring corporation, or any cash, shares of stock or other securities or
property of any nature whatsoever (including warrants or other subscription or
purchase rights) in addition to or in lieu of common stock of the successor or
acquiring corporation ("OTHER PROPERTY"), are to be received by or distributed
to the holders of Common Stock of the Corporation, then each Holder of Series E
Preferred Stock shall have the right thereafter, at its sole option, either (x)
to require the Corporation to deem such Fundamental Corporate Change to be a
liquidation, dissolution or winding up of the Corporation pursuant to which the
Corporation shall be required to distribute, upon consummation of and as a
condition to, such Fundamental Corporate Change an amount equal to 105% of the
Liquidation Preference with respect to each outstanding share of Series E
Preferred Stock, (y) to receive the number of shares of common stock of the
successor or acquiring corporation or of the Corporation, if it is the surviving
corporation, and Other Property as is receivable upon or as a result of such
Fundamental Corporate Change by a holder of the number shares of Common Stock
into which such Series E Preferred Stock may be converted at the Conversion
Price applicable immediately prior to such Fundamental Corporate Change or (z)
require the Corporation, or such successor, resulting or purchasing corporation,
as the case may be, to, without benefit of any additional consideration
therefor, to execute and deliver to the Holder shares of its Preferred Stock
with substantial identical rights, preferences, privileges, powers, restrictions
and other terms as the Series E Preferred Stock equal to the number of shares of
Series E Preferred Stock held by such Holder immediately prior to such
Fundamental Corporate Change; provided, that all Holders of Series E Preferred
Stock shall be deemed to elect the option set forth in clause (i) above if at
least a majority in interest of such Holders elect such option. The foregoing
provisions of this Section 5(b) shall similarly apply to successive Fundamental
Corporate Changes.

                                      -7-

<PAGE>

                                   ARTICLE 6
                         CONVERSION OF PREFERRED STOCK

            SECTION 6.1 CONVERSION; CONVERSION PRICE

            At the option of the Holder, the shares of Series E Preferred Stock
may be converted, either in whole or in part, into Common Shares (calculated as
to each such conversion to the nearest 1/100th of a share) at any time and from
time to time following April 30, 2000 at a conversion price per share of Common
Stock equal to the Market Price (the "CONVERSION PRICE"); provided that if the
Corporation's Common Stock is delisted off the Amex for any reason, then any
remaining unconverted Series E may be converted, at the sole option of the
Holder, at a Conversion Price per share of Common Stock equal to 50% of the
Market Price. At the Corporation's option, the amount of accrued and unpaid
dividends as of the Conversion Date shall not be subject to conversion but
instead may be paid in cash as of the Conversion Date; if the Corporation elects
to convert the amount of secured and unpaid dividends at the Conversion Date
into Common Stock, the Common Stock issued to the Holder shall be valued at the
applicable Conversion Price.

            The number of shares of Common Stock due upon conversion of Series E
Preferred Stock shall be (i) the number of shares of Series E Preferred Stock to
be converted, multiplied by (ii) the Stated Value plus accrued and unpaid
dividends, to the extent the Corporation does not elect to pay, and pay, accrued
and unpaid dividends in cash, and divided by (iii) the applicable Conversion
Price.

            Within two Business Days of the occurrence of a Valuation Event, the
Corporation shall send notice thereof to each Holder. Notwithstanding anything
to the contrary contained herein, if a Valuation Event occurs during any
Valuation Period, the Holder may convert some or all of its Series E Preferred
Stock, at its sole option, at a Conversion Price equal to the Current Market
Price on any Trading Day during the Valuation Period.

            For purposes of this Section 6.1, a "VALUATION EVENT" shall mean an
event in which the Corporation takes any of the following actions;

            (a) subdivides or combines its Capital Shares;

            (b) makes any distribution on its Capital Shares;

            (c) issues any additional Capital Shares (the "ADDITIONAL CAPITAL
SHARES"), otherwise than as provided in the foregoing Sections 6.1(a) and 6.1(b)
above, at a price per share less, or for other consideration lower, than the
Current Market Price in effect immediately prior to such issuances, or without
consideration, except for issuances under (A) employee benefit plans consistent
with those presently in effect, (B) presently outstanding warrants, options or
convertible securities and (C) in connection with an acquisition or merger where
the Board of Directors of the Corporation determines in good faith that such
Additional Capital Shares are not being issued for consideration lower than the
Current Market Price in effect immediately prior to such issuances;

                                      -8-

<PAGE>

            (d) issues any warrants, options or other rights to subscribe for or
purchase any Additional Capital Shares and the price per share for which
Additional Capital Shares may at any time thereafter be issuable pursuant to
such warrants, options or other rights shall be less than the Current Market
Price in effect immediately prior to such issuance;

            (e) issues any securities convertible into or exchangeable or
exercisable for Additional Capital Shares and the consideration per share for
which Additional Capital Shares may at any time thereafter be issuable pursuant
to the terms of such convertible, exchangeable or exercisable securities shall
be less than the Current Market Price in effect immediately prior to such
issuance;

            (f) announces or effects a Fundamental Corporate Change;

            (g) makes a distribution of its assets or evidences of indebtedness
to the holders of its Capital Shares as a dividend in liquidation or by way of
return of capital or other than as a dividend payable out of earnings or surplus
legally available for the payment of dividends under applicable law or any
distribution to such holders made in respect of the sale of all or substantially
all of the Corporation's assets (other than under the circumstances provided for
in the foregoing Section 6.1(a) through 6.1(e)); or

            (h) takes any action affecting the number of Outstanding Capital
Shares, other than an action described in any of the foregoing Sections 6.1(a)
through 6.1(g) hereof, inclusive, which in the opinion of the Holder, determined
in good faith, would have a material adverse effect upon the rights of the
Holder at the time of any conversion of Preferred Stock or its reasonably likely
to result in a decrease in the Market Price.

            SECTION 6.2 EXERCISE OF CONVERSION PRIVILEGE

            (a) Conversion of the Series E Preferred Stock may be exercised, in
whole or in part, by the Holder by telecopying an executed and completed
Conversion Notice to the Corporation. Each date on which a Conversion Notice is
telecopied to the Corporation in accordance with the provisions of this Section
6.2 shall constitute a Conversion Date. The Corporation shall convert the
Preferred Stock and issue the Common Stock Issued at Conversion, and all voting
and other rights associated with the beneficial ownership of the Common Stock
issued at Conversion shall vest with the Holder, effective as of the conversion
Date at the time specified in the Conversion Notice. The Conversion Notice also
shall state the name or names (with addresses) of the Persons who are to become
the holders of the Common Stock Issued at Conversion in connection with such
conversion. The Holder shall deliver the shares of Series E Preferred Stock to
the Corporation by express courier with 30 days following the date on which the
telecopied Conversion Notice has been transmitted to the Corporation. Upon
surrender for conversion, the Preferred Stock shall be accompanied by a proper
assignment thereof to the Corporation or be endorsed in blank. As promptly as
practicable after the receipt of the Conversion Notice as aforesaid, but in any
event not more than five Business Days after the Corporation's receipt of such
Conversion Notice, the Corporation shall (i) issue the Common Stock issued at
Conversion in accordance with the provisions of this Article 6, and (ii) cause
to be mailed for delivery by overnight courier to the Holder (x) a certificate
or certificate(s) representing the number of Common Shares to which the Holder
is entitled by virtue of such

                                      -9-

<PAGE>

conversion, (y) cash, as provided in Section 6.3, in respect of any fraction of
a Common Share issuable upon such conversion and (z) if the Corporation chooses
to pay accrued and unpaid dividends in cash, cash in the amount of accrued and
unpaid dividends as of the Conversion Date. Such conversion shall be deemed to
have been effected at the time at which the Conversion Notice indicates so long
as the Series E Preferred Stock shall have been surrendered as aforesaid at such
time, and at such time the rights of the Holder of the Series E Preferred Stock,
as such, shall cease and the Person or Persons in whose name or names the Common
Stock Issued at Conversion shall be issuable shall be deemed to have become the
holder or holders of record of the Common Shares represented thereby and all
voting and other rights associated with the beneficial ownership of such Common
Shares shall at such time vest with such Person or Persons. The Conversion
Notice shall constitute a contract between the Holder and the Corporation,
whereby the Holder shall be deemed to subscribe for the number of Common Shares
which it will be entitled to receive upon such conversion and, in payment and
satisfaction of such subscription (and for any cash adjustment to which it is
entitled pursuant to Section 6.3), to surrender the Series E Preferred Stock and
to release the Corporation from all liability thereon. No cash payment
aggregating less than $1.00 shall be required to be given unless specifically
requested by the Holder.

            (b) If, at any time (i) the Corporation challenges, disputes or
denies the rights of the Holder thereof to effect the conversion of the Series E
Preferred Stock into Common Shares or otherwise dishonors or rejects any
Conversion Notice delivered in accordance with this Section 6.2 or (ii) any
third party commences any lawsuit or proceeding or otherwise asserts any claim
before any court or public or governmental authority which seeks to challenge,
deny, enjoin, limit, modify, delay or dispute the right of the Holder hereof to
effect the conversion of the Series E Preferred Stock into Common Shares (a
"BLOCKAGE CLAIM"), and such Blockage Claim shall remain in effect and not be
resolved for a period of more than 90 days, then the Holder shall have the
right, by written notice to the Corporation, to require the Corporation to
promptly redeem the Series E Preferred Stock for cash at a redemption price
equal to 105% of the Stated Value thereof together with all accrued and unpaid
dividends thereon (the "MANDATORY PURCHASE AMOUNT"). Under any of the
circumstances set forth above, the Corporation shall be responsible for the
payment of all costs and expenses of the Holder, including reasonable legal fees
and expenses, as and when incurred in disputing any such action or pursuing its
rights hereunder (in addition to any other rights of the Holder).

            (c) The Holder shall be entitled to exercise its conversion
privilege notwithstanding the commencement of any case under 11 U.S.C. Section
101 et seq. (the "BANKRUPTCY CODE"). In the event the Corporation is a debtor
under the Bankruptcy Code, the Corporation hereby waives to the fullest extent
permitted any rights to relief it may have under 11 U.S.C. Section 362 in
respect of the Holder's conversion privilege. The Corporation hereby waives to
the fullest extent permitted any rights to relief it may have under 11 U.S.C.
Section 362 in respect of the conversion of the Series E Preferred Stock. The
Corporation agrees, without cost or expense to the Holder, to take or consent to
any and all action necessary to effectuate relief under 11 U.S.C. Section 362.

                                      -10-

<PAGE>

            SECTION 6.3 FRACTIONAL SHARES

            No fractional Common Shares or scrip representing fractional Common
Shares shall be issued upon conversion of the Series E Preferred Stock. Instead
of any fractional Common Shares which otherwise would be issuable upon
conversion of the Series E Preferred Stock, the Corporation shall pay a cash
adjustment in respect of such fraction in an amount equal to the same fraction.

            SECTION 6.4 ADJUSTMENTS TO CONVERSION PRICE

            Except with respect to issuances of Capital Shares in connection
with an acquisition or merger where the Board of Directors of the Corporation
determines in good faith that such Capital Shares are not being issued for
consideration lower than the Current Market Price in effect immediately prior to
such issuances, for so long as any shares of the Series E Preferred Stock are
outstanding, if the Corporation issues and sells pursuant to an exemption from
registration under the Securities Act (A) Common Shares at a purchase price on
the date of issuance thereof that is lower than the Conversion Price, (B)
warrants or options with an exercise price on the date of issuance thereof that
is lower than the Conversion Price for the Holder on such date, except for
warrants or options issued pursuant to employee benefit plans consistent with
those presently in effect, employee stock option agreements or stock incentive
agreements of the Corporation, or (C) convertible, exchangeable or exercisable
securities with a right to exchange at lower than the Current Market Price on
the date of issuance or conversion, as applicable, of such convertible,
exchangeable or exercisable securities, except for stock option agreements or
stock incentive agreements, then on any date on which the Conversion Price shall
be determined, the Conversion Price shall be reduced by an amount equal to the
amount by which the purchase price, exercise price or exchange price, as
applicable, is lower than the Conversion Price or Current Market Price, as
applicable, multiplied by a fraction the denominator of which is $2,500,000 and
the numerator of which is the sum of (A) the aggregate number of (i) Common
Shares, in the case of (A) above, (ii) Common Shares into which the warrants or
options are exchangeable into, in the case of (B) above, or (iii) equity
securities into which the convertible or exchangeable securities are exercisable
into, in the case of (C) above, multiplied by (B) the Conversion Price, in each
case, with a maximum adjustment equal to the applicable discount triggering such
adjustment pursuant to this Section 6.4.

            SECTION 6.5 OPTIONAL REDEMPTION

            (a) At any time on or before April 30, 2000 (the "APRIL 30, 2000
REDEMPTION DATE") the Corporation, upon notice delivered to the Holder as
provided in Section 6.6, may redeem the Series E Preferred Stock for a
redemption price of $2,800,000, together with all unpaid dividends thereon
through April 30, 2000, whether or not accrued, in each case in cash (the
"SECTION 6.5(A) OPTIONAL REDEMPTION PRICE").

            (b) At any time after the April 30, 2000 Redemption Date until the
Mandatory Conversion Date, the Corporation, upon notice delivered to the Holder
as provided in Section 6.6, may redeem, in cash, the Series E Preferred Stock
(but only with respect to such shares as to which the Holder has not theretofore
furnished a Conversion Notice in compliance with Section 6.2), at the Stated
Value thereof (the "SECTION 6.5(B) OPTIONAL REDEMPTION PRICE"), together

                                      -11-

<PAGE>

with all accrued an unpaid dividends thereon to the date of redemption (the
SECTION 6.5(B) REDEMPTION DATE" and, together with the April 30, 2000 Redemption
Date, the "REDEMPTION DATE").

            (c) The Section 6.5(a) Redemption Price and the Section 6.5(b)
Redemption Price, as applicable, as referred to herein as the "OPTIONAL
REDEMPTION PRICE." Except as set forth in this Section 6.5, the Corporation
shall not have the right to redeem the Series E Preferred Stock.

            SECTION 6.6 NOTICE OF REDEMPTION

            Notice of redemption pursuant to Section 6.5 shall be provided by
the Corporation to the Holder in writing (by registered mail or overnight
courier at the Holder's last address appearing in the Corporation's security
registry) not less than ten nor more than 15 days prior to the Redemption Date,
which notice shall specify the Redemption Date and refer to Section 6.5
(including a statement of the Current Market Price per Common Share) and this
Section 6.6.

            SECTION 6.7 SURRENDER OF PREFERRED STOCK.

            Upon any redemption of the Series E Preferred Stock pursuant to
Sections 6.5 and 6.6, the Holder shall either deliver the Series E Preferred
Stock by hand to the Corporation at its principal executive offices or surrender
the same to the Corporation at such address by express courier within 14 days
after the date that the Buyer receives payment therefore. Payment of the
Optional Redemption Price shall be made by the Corporation to the Holder by wire
transfer of immediately available funds to such account(s) as the Holder shall
specify to the Corporation. If payment of such Optional Redemption Price is not
made in full by the Redemption Date, the Holder shall again have the right to
convert the Series E Preferred Stock as provided in Article 6 hereof.

            SECTION 6.8 MANDATORY CONVERSION

            On the 42nd (forty second) calendar month anniversary of the Issue
Date (the "MANDATORY CONVERSION DATE"), the Corporation shall convert all Series
E Preferred Stock outstanding at the Conversion Price utilizing the Stated Value
(plus accrued and unpaid dividends) as the value of each share of Series E
Preferred Stock, into Common Stock which is registered for sale in open market
transactions on the Registration Statement (as defined in the Registration
Rights Agreement), which Registration Statement shall then be effective under
the Securities Act.

            SECTION 6.9 CERTAIN CONVERSION LIMITATIONS

            (a) Notwithstanding anything herein to the contrary, the Holder
shall not have the right, and the Corporation shall not have the obligation, to
convert all or any portion of the Series E Preferred Stock (and the Corporation
shall not have the right to pay dividends on the Series E Preferred Stock in
shares of Common Stock) if and to the extent that the issuance to the Holder of
shares of Common Stock upon such conversion (or payment of dividends) would
result in the Holder being deemed the "beneficial owner" of more than 5% of the
then Outstanding shares of Common Stock within the meaning of Section 13(d) of
the Securities

                                      -12-

<PAGE>

Exchange Act of 1934, as amended, and the rules promulgated thereunder. If any
court of competent jurisdiction shall determine that the foregoing limitation is
ineffective to prevent a Holder from being deemed the beneficial owner of more
than 5% of the then Outstanding shares of Common Stock, then the Corporation
shall redeem so many of such Holder's shares (the "REDEMPTION SHARES") of Series
E Preferred Stock as are necessary to cause such Holder to be deemed the
beneficial owner of not more than 5% of the then Outstanding shares of Common
Stock. Upon such determination by a court of competent jurisdiction, the
Redemption Shares shall immediately and without further action be deemed
returned to the status of authorized but unissued shares of Series E Preferred
Stock, and the Holder shall have no interest in or rights under such Redemption
Shares. Any and all dividends paid on or prior to the date of such determination
shall be deemed dividends paid on the remaining shares of Series E Preferred
Stock held by the Holder. Such redemption shall be for cash at a redemption
price equal to the sum of (i) 105% of the Stated Value of the Redemption Shares
and (ii) any accrued and unpaid dividends to the date of such redemption.

            (b) Unless the Corporation shall have obtained the approval of its
voting stockholders to such issuance in accordance with the rules of the Amex or
such other stock market with which the Corporation shall be required to comply,
but only to the extent required thereby, the Corporation shall not issue shares
of Common Stock (i) upon conversion of any shares of Series E Preferred Stock or
(ii) as a dividend on the Series E Preferred Stock, if such issuance of Common
Stock, when added to the number of shares of Common Stock previously issued by
the Corporation (i) upon conversion of shares of the Series E Preferred Stock,
(ii) upon exercise of the Warrants issued pursuant to the terms of the
Securities Purchase Agreement and (iii) in payment of dividends on the Series E
Preferred Stock, would equal or exceed 20% of the number of shares of the
Corporation's Common Stock which were issued and Outstanding on the Issue Date
(the "MAXIMUM ISSUANCE AMOUNT"). In the event that a properly executed
Conversion Notice is received by the Corporation which would require the
Corporation to issue shares of Common Stock equal to or in excess of the Maximum
Issuance Amount, the Corporation shall honor such conversion request by (i)
converting the number of shares of Series E Preferred Stock stated in the
Conversion Notice not in excess of the Maximum Issuance Amount and (ii)
redeeming the number of shares of Series E Preferred Stock stated in the
Conversion Notice equal to or in excess of the Maximum Issuance Amount in cash
at a price equal to 105% of the Stated Value of the shares of Series E Preferred
Stock to be so redeemed, together with all accrued and unpaid dividends thereon.
In the event that the Corporation shall elect to pay a dividend in shares of
Common Stock which would require the Corporation to issue shares of Common Stock
equal to or in excess of the Maximum Issuance Amount, the Corporation shall pay
(i) a dividend in shares of Common Stock equal to one less than an amount which
would result in the Corporation issuing shares equal to the Maximum Issuance
Amount and (ii) the balance of the dividend in cash.

                                   ARTICLE 7
                                 VOTING RIGHTS

            The Holders of the Series E Preferred Stock have no voting power,
except as otherwise provided by the General Corporation Law of the State of
Delaware ("DGCL"), in this Article 7, and in Article 8 below.

                                      -13-

<PAGE>

            Notwithstanding the above, the Corporation shall provide each Holder
of Series E Preferred Stock with prior notification of any meeting of the
shareholders (and copies of proxy materials and other information sent to
shareholders). In the event of any taking by the Corporation of a record of its
shareholders for the purpose of determining shareholders who are entitled to
receive payment of any dividend or other distribution, any right to subscribe
for, purchase or otherwise acquire (including by way of merger, consolidation or
recapitalization) any share of any class or any other securities or property, or
to receive any other right, or for the purpose of determining shareholders who
are entitled to vote in connection with any proposed liquidation, dissolution or
winding up of the Corporation, the Corporation shall mail a notice to each
Holder, at least 30 days prior to the consummation of the transaction or event,
whichever is earlier), of the date on which any such action is to be taken for
the purpose of such dividend, distribution, right or other event, and a brief
statement regarding, the amount and character of such dividend, distribution,
right or other event to the extent known at such time.

            To the extent that under the DGCL the vote of the Holders of the
Section E Preferred Stock, voting separately as a class or series as applicable,
is required to authorize a given action of the Corporation, the affirmative vote
or consent of the Holders of at least a majority of the outstanding shares of
Series E Preferred Stock represented at a duly held meeting at which a quorum is
present or by written consent of a majority of the outstanding shares of Series
E Preferred Stock (except as otherwise may be required under the DGCL) shall
constitute the approval of such action by the class. To the extent that under
the DGCL Holders of the Series E Preferred Stock are entitled to vote on a
matter with holders of Common Stock, voting together as one class, each share of
Series E Preferred Stock shall be entitled to a number of votes equal to the
number of shares of Common Stock into which it is then convertible using the
record date for the taking of such vote of shareholders as the date as of which
the Conversion Price is calculated. Holders of the Series E Preferred Stock
shall be entitled to notice of all shareholder meetings or written consents (and
copies of proxy materials and other information sent to shareholders) with
respect to which they would be entitled to vote, which notice would be provided
pursuant to the Corporation's bylaws and the DGCL.

                                    ARTICLE 8
                              PROTECTIVE PROVISIONS

            So long as shares of Series E Preferred Stock are outstanding, the
Corporation shall not, without first obtaining the approval (by vote or written
consent, as provided by the DGCL) of the Holders of at least a majority of the
then outstanding shares of Series E Preferred Stock:

            (a) alter or change the rights, preferences or privileges of the
Series E Preferred Stock;

            (b) create any new class or series of capital stock having a
preference over the Series E Preferred Stock as to distribution of assets upon
liquidation, dissolution or winding up of the Corporation ("SENIOR SECURITIES")
or alter or change the rights, preferences or privileges of any Senior
Securities so as to affect adversely the Series E Preferred Stock;

            (c) increase the authorized number of shares of Series E Preferred
Stock; or

                                      -14-

<PAGE>

            (d) do any act or thing not authorized or contemplated by this
Certificate of Designation which would result in taxation of the Holders of the
Series E Preferred Stock under Section 305 of the Internal Revenue Code of 1986,
as amended (or any comparable provision of the Internal Revenue Code as
hereafter from time to time amended).

            In the event Holders of least a majority of the then outstanding
shares of Series E Preferred Stock agree to allow the Corporation to alter or
change the rights, preferences or privileges of the shares of Series Preferred
Stock, pursuant to subsection (a) above, so as to affect the Series E Preferred
Stock, then the Corporation will deliver notice of such approved change to the
Holders of the Series Preferred Stock that did not agree to such alteration or
change (the "DISSENTING HOLDERS") and Dissenting Holders shall have the right
for a period of 30 days to convert pursuant to the terms of this Certificate of
Designation as in effect prior to such alteration or change or continue to hold
their shares of Series E Preferred Stock.

            Notwithstanding anything to the contrary herein, if at any time the
Corporation shall "spin-off" certain of its assets or businesses by
transferring, directly, or indirectly, such assets or businesses to a Subsidiary
of the Corporation ("SPINCO") and making a dividend (the "SPIN-OFF DIVIDEND") to
the Corporation's stockholders of the shares of capital stock of Spinco, then
prior to making the Spin-Off Dividend, the Corporation shall cause Spinco to
issue to each Holder that number of shares of preferred stock of Spinco with
substantially identical rights, preferences, privileges, powers, restrictions
and other terms as the Series E Preferred Stock equal to the number of shares of
Series E Preferred Shares held by such Holder immediately prior to the Spin-Off
Dividend.

                                   ARTICLE 9
                                 MISCELLANEOUS

            SECTION 9.1 LOSS, THEFT, DESTRUCTION OF PREFERRED STOCK

            Upon receipt of evidence satisfactory to the Corporation of the
loss, theft, destruction or mutilation of shares of Series E Preferred Stock
and, in the case of any such loss, theft or destruction, upon receipt of
indemnity or security reasonably satisfactory to the Corporation, or, in the
case of such mutilitation, upon surrender and cancellation of the Series E
Preferred Stock, the Corporation shall make, issue and deliver, in lieu of such
lost, stolen, destroyed or mutilated shares of Series E Preferred Stock, new
shares of Series E Preferred Stock of like tenor. The Series E Preferred Stock
shall be held and owned upon the express condition that the provisions of this
Section 9.1 are exclusive with respect to the replacement of mutilated,
destroyed, lost or stolen shares of Series E Preferred Stock and shall preclude
any and all other rights and remedies notwithstanding any law or statute
existing or hereafter enacted to the contrary with respect to the replacement of
negotiable instruments or other securities without the surrender thereof.

            SECTION 9.2 WHO DEEMED ABSOLUTE OWNER

            The Corporation may deem the Person in whose name the Series E
Preferred Stock shall be registered upon the registry books of the Corporation
to be, and may treat it as, the absolute owner of the Series E Preferred Stock
for the purpose of receiving payment of dividends

                                      -15-

<PAGE>

on the Series E Preferred Stock, for the conversion of the Series E Preferred
Stock and for all other purposes, and the Corporation shall not be affected by
any notice to the contrary. All such payments and such conversion shall be valid
and effectual to satisfy and discharge the liability upon the Series E Preferred
Stock to the extent of the sum or sums so paid or the conversion so made.

      SECTION 9.3 NOTICE OF CERTAIN EVENTS

      In the case of the occurrence of any event described in Sections 5(b), 6.5
or 6.6 of this Certificate of Designation, the Corporation shall cause to be
mailed to the Holder of the Series E Preferred Stock at its last address as it
appears in the Corporation's security registry, at least 20 days prior to the
applicable record, effective or expiration date hereinafter specified (or, if
such 20 days notice is not possible, at the earliest possible date prior to any
such record, effective or expiration date), a notice stating (x) the date on
which a record is to be taken for the purpose of such corporate action, or if a
record is not to be taken, the date as of which the Holders of record of Series
E Preferred Stock to be entitled to such dividend, distribution, issuance or
granting of rights, options or warrants are to be determination or the date on
which such reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding-up is expected to become effective, and (y) the date as
of which it is expected that Holders of record of Series E Preferred Stock will
be entitled to exchange their shares for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, sale transfer,
dissolution, liquidation or winding-up.

      SECTION 9.4 REGISTER

      The Corporation shall keep at its principal office a register in which the
Corporation shall provide for the registration of the Series E Preferred Stock.
Upon any transfer of the Series E Preferred Stock in accordance with the
provisions hereof, the Corporation shall register such transfer on the Series E
Preferred Stock register.

      SECTION 9.5 WITHHOLDING

      To the extent required by applicable law, the Corporation may withhold
amounts for or on account of any taxes imposed or levied by or on behalf of any
taxing authority in the United States having jurisdiction over the Corporation
from any payments made pursuant to the Series E Preferred Stock.

      SECTION 9.6 HEADINGS

      The headings of the Articles and Sections of this Certificate of
Designation are inserted for convenience only and do not constitute a part of
this Certificate of Designation.

      SECTION 9.7 SEVERABLILITY

      If any provision of this Certificate of Designation, or the application
thereof to any person or entity or any circumstance, is invalid or
unenforceable, (i) a suitable and equitable provision shall be substituted
therefor in order to carry out, so far as may be valid and

                                      -16-

<PAGE>

enforceable, the intent and purpose of such invalid or unenforceable provision,
and (ii) the remainder of this Certificate of Designation and the application of
such provision to other persons, entities or circumstances shall not be affected
by such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or unenforceability of such provision, or
the application thereof, in any other jurisdiction.

                            [SIGNATURE PAGE FOLLOWS]

                                      -17-

<PAGE>

          IN WITNESS WHEREOF, the Corporation has caused this Amended
Certificate of Designation to be signed by its duly authorized officers on
November 4, 1999.

                                        COMMODORE APPLIED TECHNOLOGIES, INC.

                                        By: /s/ Paul Hannesson
                                           -------------------------------------
                                           Name: Paul Hannesson
                                           Title: CEO

                                        By: /s/ James M. DeAngelis
                                           -------------------------------------
                                           Name: James M. DeAngelis
                                           Title: Vice President and Treasurer

                                      -18-

<PAGE>

                                                                         ANNEX I

                           FORM OF CONVERSION NOTICE

To:Commodore Applied Technologies, Inc.
           150 East 58th Street
           New York, New York 10155

      The undersigned owner of this Series E Convertible Preferred Stock (the
"SERIES E PREFERRED STOCK") issued by Commodore Applied Technologies, Inc. (the
"CORPORATION") hereby irrevocably exercises its option to convert _________
shares of Series E Preferred Stock into shares of the common stock, par value
$0.001 per share ("COMMON STOCK"), of the Corporation in accordance with the
terms of the Certificate of Designation. The undersigned hereby instructs the
Corporation to convert the number of shares of the Series E Preferred Stock
specified above into Shares of Common Stock Issued at Conversion in accordance
with the provisions of Article 6 of the Certificate of Designation. The
undersigned directs that the Common Stock issuable and certificates therefor
deliverable upon conversion, the Series E Preferred Stock recertificated, if
any, not being surrendered for conversion hereby, together with any check in
payment for fractional Common Stock, be issued in the name of and delivered to
the undersigned unless a different name has been indicated below. All
capitalized terms used and not defined herein have the respective meanings
assigned to them in the Certificate of Designation. So long as the Series E
Preferred Stock shall have been surrendered for conversion hereby, the
conversion pursuant hereto shall be deemed to have been effected at the date and
time specified below, and at such time the rights of the undersigned as a Holder
of the Series E Preferred Stock shall cease and the Person or Persons in whose
name or names the Common Stock Issued at Conversion shall be issuable shall be
deemed to have become the holder or holders of record of the Common Shares
represented thereby and all voting and other rights associated with the
beneficial ownership of such Common Stock shall at such time vest with such
Person or Persons.

Date and time:_____________________

                                        ----------------------------------------
                                                       Signature

Fill in for registration of Series E Preferred Stock:

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            Please print name and address (including zip code number)