**SUPPLY      AND DISTRIBUTION AGREEMENT**

**Agreement**
**Effective      Date**
** **
**O2Diesel**
**Energenics**
**Party**
**Parties**

**1.**
**Definitions**
**.**

| 1.1   | “**Affiliate**”                with respect to a Person, means any other Person controlling, controlled                by or under common control with, such first                Person. |
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| 1.2   | “**Change                of Control**”                means a merger, consolidation, reorganization, recapitalization or                sale,                transfer or other disposition of all or substantially all of the                assets of                the company. |
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| 1.3   | “**Closing**”                means the consummation of the purchase and sale of shares of common                stock                and warrants for the future purchase of common stock of O2Diesel,                as such                is contemplated and described by the Common Stock and Warrant Purchase                Agreement executed by O2Diesel and an Affiliate of Energenics on                September                15, 2006. |
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| 1.4   | “**Closing                Date**”                means the date of Closing as agreed to by the Parties in Section                2.1 of                the Common Stock and Warrant Purchase                Agreement. |
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| 1.5   | “**O2Diesel                Additive**”                means an O2Diesel proprietary compound that allows the mixing of                diesel                fuel and ethanol. |
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| 1.6   | “**O2Diesel                Product**”                means oxygenated diesel fuel comprising base diesel fuel, the O2Diesel                Additive, ethanol and a cetane improver, conforming to the specifications                for such product provided by O2Diesel (including all improvements                or                branded products). |
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*****
**“*”**

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| 1.7   | “**Person**”                means a natural person, a corporation, a partnership, a trust, a                joint                venture, any governmental authority or any other entity or                organization. |
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| 1.8   | “**Term**”                shall have the meaning given in Section                11.1. |
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| 1.9   | “**Territory**”                means the following countries in South Asia and Asia Pacific, India,                Australia, New Zealand, Singapore and Hong Kong. The countries of                South                Africa, Philippines and Thailand shall be included in the Territory                subject to trials being conducted within twelve (12) months from                the date                of this Agreement. |
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| 1.10   | “**Third                Party**”                means any Person that is not a Party to this                Agreement. |
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**2.**
**Supply      of O2Diesel Additive**
**.**

| 2.1   | **Appointment                of Distributor****.**As                of the Closing Date, O2Diesel hereby appoints on an exclusive basis                Energenics as a distributor of O2Diesel Product in the Territory                subject                to the terms and conditions of this Agreement. For as long as Energenics                has materially performed and continues to materially perform its                obligations under this Agreement, O2Diesel is prohibited from entering                into any agreement and/or arrangement to directly or indirectly distribute                or sell and/or authorise a Third Party to distribute and/or sell                O2Diesel                Product in the Territory and distribute or sell to any Third Party                O2Diesel Additive in the Territory. For as long as O2Diesel has materially                performed and continues to materially perform its obligations under                this                Agreement, Energenics is prohibited from purchasing any competing                product                of O2Diesel Additive. |
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| 2.2   | **Ordering                and Delivery**.                Energenics                shall purchase and O2Diesel shall sell the O2Diesel Additive on the                basis                of Energenics purchase orders. Energenics shall submit the purchase                orders                for a requested quantity of O2Diesel Additive at least twelve (12)                weeks                prior to the requested delivery date. O2Diesel shall supply the requested                quantity at a price agreed in the purchase order and the delivery                shall be                CIF. Further, the terms and conditions of the purchase order shall                be in                addition to the terms of this Agreement provided that, if any term                of the                purchase order is inconsistent with the terms of this Agreement,                the terms                of this Agreement shall prevail. |
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| 2.3   | **Minimum                Volume****.**The                Parties have agreed that Energenics shall place orders and O2Diesel                shall                supply the minimum of O2Diesel Additive (the “**Minimum                Volume**”)                at the price as set forth on Schedule                A                and O2Diesel shall in no event fail to supply the Minimum Volume                provided                however that, if the price of ethanol increases by *****                (*****%)                over the agreed price (“**Price                Threshold**”)                Energenics may at its option temporarily defer purchasing the Minimum                Volume (“**Deferred                Volume**”)                and in such a case, Energenics shall be obligated to purchase the                Deferred                Volume once the price decreases below the Price Threshold over the                same                amount of time the Deferred Volume was deferred. For example, if                the                ethanol price is greater than the Price Threshold for six (6) months,                Energenics shall have up to six (6) months to purchase the Deferred                Volume. In the event that O2Diesel ceases to distribute the O2Diesel                Additive in the Territory, O2Diesel shall assist Energenics in obtaining                an agreement with Cognis Deutschland GmbH on the same terms and conditions                that O2Diesel or its subsidiaries was supplying the O2Diesel Additive                in                the Territory. |
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| 2.4   | **Forecasting****.**                After the first commercial sale of O2Diesel Product, on a quarterly                basis                within five (5) days of the beginning of each quarter, Energenics                shall                provide non-binding forecasts of its expected requirements of O2Diesel                Additive for the following twelve (12)                months. |
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| 2.5   | **Use                of O2Diesel Additive****.**                Energenics shall: (a) use O2Diesel Additive only to make O2Diesel                Product,                in accordance with all specifications and guidance provided by O2Diesel                for the manufacture, use, handling, storage, transportation and disposal                of O2Diesel Additive and O2Diesel Product; (b) resell O2Diesel                Additive only as blended into O2Diesel Product or to Third Parties                who                agree to blend the O2Diesel additive into O2Diesel Product, in accordance                with all specifications and guidance provided by O2Diesel for the                manufacture, use, handling, storage, transportation and disposal                of                O2Diesel Additive and O2Diesel Product; and (c) not analyze or reverse                engineer the O2Diesel Additive to determine its composition or method                of                manufacture. |
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| **2.6  ** | **Sourcing                of Other Supplies****.**                O2Diesel acknowledges that, excluding O2Diesel Additive, neither                Party is                responsible for ensuring that the end user / blender has sufficient                equipment and supplies for its performance under this Agreement,                including                supplies of base diesel fuel, ethanol and cetane improver for the                production of O2Diesel Product. |
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| 2.7   | **Government                Approvals****.**Energenics                together with the end user/purchaser shall investigate and determine                whether any governmental approvals will be necessary for the distribution                and use of O2Diesel Product in the Territory prior to selling any                O2Diesel                Product in the Territory. If Energenics together with the end                user/purchaser have determined that governmental approvals are necessary                for the distribution and use of O2Diesel Product in the Territory,                they                shall, promptly thereafter apply for such approvals in their name.                O2Diesel agrees to provide all necessary information and support                Energenics in obtaining such approval.** **A                report                of this information shall be delivered to O2Diesel promptly. In                any                event, Energenics shall consult with O2Diesel concerning all material                issues in obtaining and maintaining governmental approvals and provide                O2Diesel copies of all test results, applications, correspondence                and                other documents relating to government approvals. O2Diesel shall                neither                have any right to reproduce, use and disclose the foregoing approval                nor                shall it authorize the same for purposes of distributing oxygenated                diesel                fuel or other products without the prior written consent of Energenics.                In                any event, Energenics shall consult with O2Diesel concerning all                material                issues in obtaining and maintaining governmental approvals and provide                O2Diesel copies of all test results, applications, correspondence                and                other documents relating to government approvals. O2Diesel shall                have the                perpetual right to reproduce, use and disclose the foregoing and                authorize                the same for purposes of distributing oxygenated diesel fuel or other                products.. |
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| 2.8   | **Other                Territories****.**                Energenics and its Affiliates shall not (a) export any O2Diesel Additive                or O2Diesel Product from the Territory or (b) sell O2Diesel Additive                or                O2Diesel Product to any Third Party with the knowledge that such                Third                Party is likely to resell O2Diesel Additive unblended, resell O2Diesel                Product, or export O2Diesel Additive or O2Diesel Product from the                Territory. O2Diesel shall endeavor that importation and use of O2Diesel                Product in the Territory by a Third Party shall be only from Energenics                and not from O2Diesel or another authorized source outside the Territory.                Notwithstanding the foregoing, each Party shall notify the other                Party                about any such activity and the Parties shall consult in good faith                whether there is any practicable action that should be taken as a                commercial matter to address the                situation. |
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| 2.9   | **Safety                and Blending Procedures****.**                Promptly after the Effective Date, O2Diesel shall provide to Energenics                a                manual describing procedures for the use, blending and handling of                O2Diesel Additive and O2Diesel Product, including a material safety                data                sheet, procedures for blending O2Diesel Product, fuel tank preparation                procedures for the storage of O2Diesel Product and sample warning                decals                (the “**Manual**”).                O2Diesel shall have the right to reasonably add to, delete from and                otherwise modify the Manual at any time. Energenics and its customers                shall at all times blend, handle and store the O2Diesel Additive                in                accordance with the Manual. In the event such addition or deletion                results                in any reasonable costs to Energenics, the same shall be borne by                O2Diesel. |
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**3.**
**Payments**
**.**

| 3.1   | **Sales                Targets****.**                O2Diesel and Energenics have agreed to a sales target for the first                three                (3) years and three (3) months of the Term, as set forth in Schedule A.                If the targets cannot be achieved Energenics will inform O2Diesel                and                mutual accepted targets will be agreed upon. If in good faith the                Parties                can not agree to a target, and Energenics’ orders fall below fifty percent                (50%) of the previously agreed target, O2Diesel shall have the right                to                change Energenics’ as an exclusive distributor of O2Diesel Additive to a                non-exclusive basis. |
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| 3.2   | **Payments                Due****.**                All purchase orders from Energenics will be covered by a letter of                credit                (“**L/C**”)                from first class bank in favor of O2Diesel at least thirty (30) days                in                advance of such order. Energenics shall make the payment once telephonic                evidence of a shipment is received by Energenics. The terms of payment                covered by L/C will be mutually agreed. Such L/C shall be issued                by a                mutually agreed-upon United States                bank. |
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| 3.3   | **Payments                in General****.**                All amounts payable by Energenics hereunder shall be paid in U.S.                Dollars                to O2Diesel by wire transfer, or by such other method mutually agreed                upon                by the Parties, for value no later than the due date thereof (with                twenty-four (24)) hours advance notice of each such wire transfer)                to such                bank account or accounts as O2Diesel shall designate in writing within                a                reasonable period of time prior to such due date. |
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| 3.4   | **Late                Payments****.**                If                Energenics fails to make any payment required under this Agreement                when                due, Energenics shall pay interest on such amount at the rate of                2% per                month, or the highest rate allowed by law, whichever is less, from                the                date the payment was due until the date the payment is made in full. |
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| 3.5   | **Taxes****.**Energenics                or the end user/purchaser shall pay applicable import taxes and in                connection with purchase from O2Diesel and all amounts due hereunder                shall                be net of any taxes or similar governmental charges as Energenics                or the                end user/purhcaser may be liable. All other taxes and other associated                costs shall be borne by the party liable for the same. |
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**4.**
**Use      of Trademarks**
**.      **

| 4.1   | **License                Grants****.**  |
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| 4.1.1   | O2Diesel                hereby grants to Energenics an exclusive license,                subject to instances that are beyond O2Diesel’s control, to use the name                “O2Diesel” and the “O2Diesel” logo or such different or additional                trademarks as O2Diesel may specify (the **“O2Diesel** **Trademarks”**)                in the Territory during the Term of this Agreement in connection                with the                marketing, sale and distribution of O2Diesel Product that conforms                to                O2Diesel’s applicable specifications therefor and is produced using                O2Diesel Additive purchased from O2Diesel pursuant to this Agreement.                Energenics shall not interfere with the validity and O2Diesel’s ownership                of the O2Diesel Trademarks and shall not do anything inconsistent                with                such validity and ownership. O2Diesel shall give a six months notice                to                Energenics to discontinue the use of O2Diesel Trademark and Energenics                shall cease to use it within a reasonable time, provided that O2Diesel                shall not during the Term of this Agreement notify Energenics to                discontinue the use of O2Diesel Trademark. It is agreed between the                Parties that Energenics shall have the right to sublicense the O2Diesel                Trademarks to its Affiliates on terms and condition contained in                this                Agreement, with O2Diesel’s prior written consent, which consent not to be                unreasonably withheld. |
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| 4.1.2   | Energenics                hereby grants to O2Diesel a nonexclusive, worldwide license to use                Energenics’s name and logo (the **“Energenics                Trademarks”**)                during the Term to identify Energenics as the exclusive distributor                of                O2Diesel Product in the Territory. |
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| 4.1.3   | Notwithstanding                anything contained herein, Energenics shall be free to re-brand the                O2Diesel Product in the Territory as it may deem fit with O2Diesel’s prior                written consent, which consent not to be unreasonably                withheld. |
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| 4.2   | **Limitations                on Use of Marks****.**                Energenics’s use of the O2Diesel Trademarks and O2Diesel’s use of the                Energenics Trademarks shall (a) be consistent with the high quality                image                of the other Party so as to enhance the marks and the goodwill relating                thereto, (b) conform to the style and usage guidelines prescribed                by the                other Party, (c) inure to the benefit of the other Party, and (d) be                in a manner so as not to cause embarrassment to the other Party,                tend to                discredit the other Party’s image or reputation for quality, or suggest                that any actions undertaken are actions of the other Party. On request,                Energenics promptly shall provide to O2Diesel samples of Energenics’s use                of the O2Diesel Trademarks, and O2Diesel promptly shall provide to                Energenics samples of O2Diesel’s use of the Energenics Trademarks. Nothing                in this Agreement shall interfere with a Party’s use of its marks anywhere                in the world, except that during the Term, so long as the terms and                conditions of this Agreement are met by Energenics, O2Diesel shall                not use                or authorize the use of the O2Diesel Trademarks in the Territory                to                indicate a source of oxygenated diesel fuel in the Territory other                than                Energenics. |
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| 4.3   | **Protection                of Marks****.**                All rights with respect to the O2Diesel Trademarks and Energenics                Trademarks not expressly granted in this Agreement are reserved by                O2Diesel or Energenics, as the case may be. Energenics acknowledges                the                validity and O2Diesel’s ownership of the O2Diesel Trademarks, and O2Diesel                acknowledges the validity and Energenics’s ownership of Energenics’                Trademarks. Neither Party shall challenge the validity or ownership                of the                other Party’s marks or do anything inconsistent with such validity and                ownership. Neither Party shall use any unitary composite mark consisting                of marks of both Parties. Neither Party shall apply for registration                of                any of the other Party’s marks as a trademark in any country or oppose                registration of the other party’s marks by the other Party. The Parties                may agree in writing that Energenics shall have the right to enforce                the                O2Diesel Trademarks against any particular infringement by a distributor                of oxygenated diesel fuel in the Territory. In other respects, each                Party                shall have the sole right, but not the obligation, to register, protect                and enforce its marks. |
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| 4.4   | **Additional                Trademarks****.**                Notwithstanding anything contained herein, Energenics shall be free                to                re-brand the O2Diesel Product in the Territory as it may deem fit                with                O2Diesel’s prior written consent, which consent not to be unreasonably                withheld. If Energenics believes that a trademark other than the                O2Diesel                Trademarks should be used to identify O2Diesel Product in the Territory,                it shall give a notice in writing to O2Diesel. In the absence of                a written                agreement to the contrary, any such re-branded mark shall be owned                by                Energenics and treated as an Energenics Trademark for the purposes                of this                Agreements. |
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**5.**
**Confidentiality**
**.**

| 5.1   | **Definitions**.                In connection with its activities under this Agreement, a Party (the                “**Receiving                Party**”)                may receive or otherwise have access to “Confidential Information” of the                other Party (the “**Disclosing                Party**”).                The term “**Confidential                Information**”                include any material or information relating to the Disclosing Party’s                technology, research, development, product plans, trade secrets,                finances                or business operations that the Disclosing Party treats as confidential                as                well as this Agreement, but not any material or information that                the                Receiving Party can demonstrate (a) is or becomes publicly known                through                no fault of the Receiving Party; (b) is developed independently by                the                Receiving Party; (c) is known by the Receiving Party when disclosed                by the                Disclosing Party if the Receiving Party does not then have a duty                to                maintain its confidentiality; or (d) is rightfully obtained by the                Receiving Party from a Third Party not obligated to preserve its                confidentiality who did not receive the material or information directly                or indirectly from the Disclosing                Party. |
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| 5.2   | **Limitations                on Use and Disclosure**.                A                Receiving Party shall not use the Disclosing Party’s Confidential                Information for any purpose other than performance of this Agreement                and                shall not disclose Confidential Information to any Person other than                its                employees and its independent contractors subject to a nondisclosure                obligation comparable in scope to this Article, which employees and                independent contractors have a need to know such Confidential Information                for the performance of this Agreement. Upon the expiration or termination                of this Agreement or such earlier time as particular Confidential                Information may no longer be necessary for the performance of this                Agreement, a Receiving Party shall, on request, return or destroy                all                embodiments of the Disclosing Party’s Confidential Information in its                possession or control. The Parties shall notify their employees of                the                confidential nature of the Confidential Information, and the Receiving                Party shall be liable to the Disclosing Party for any unauthorized                use or                disclosure made by any person receiving Confidential Information                the                Receiving Party. |
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| 5.3   | **Exception****.**Notwithstanding                Section 5.2, a Receiving Party may disclose Confidential Information                to the extent required by a court or other governmental authority,                provided that (a) the Receiving Party gives the Disclosing Party                reasonable notice of the disclosure, (b) the Receiving Party uses                reasonable efforts to resist disclosing the Confidential Information                and                minimize the amount of Confidential Information disclosed, and (c)                the                Receiving Party cooperates with the Disclosing Party on request to                seek a                protective order or otherwise limit the effects of the disclosure. |
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| 5.4   | **Acknowledgement**.                The Parties acknowledge that either Party’s breach of this Article 7 would                cause the other Party irreparable injury for which it would not have                an                adequate remedy at law. In the event of a breach, the non-breaching                Party                shall be entitled to injunctive relief in addition to any other remedies                it may have at law or in equity. |
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**6.**
**Other      Intellectual Property Matters**
**.**

| 6.1   | **In                General**.                Subject to all of Energenics’s obligations under this Agreement, O2Diesel                hereby acknowledges that Energenics may practice O2Diesel’s patents and                trade secrets in the Territory during the Term to the extent necessary                to                blend O2Diesel Product using O2Diesel Additive purchased from O2Diesel                under Article 4. As between the Parties, O2Diesel shall retain all                right,                title and interest in and to its patents, trade secrets and other                intellectual property ( the **“O2Diesel                Intellectual Property”**).                All rights with respect to O2Diesel Intellectual Property not expressly                granted to Energenics in this Agreement are reserved by O2Diesel,                and                O2Diesel grants no licenses by implication or estoppel. Energenics                shall                take no action inconsistent with such O2Diesel Intellectual Property                rights. For the avoidance of doubt, and without limiting the generality                of                the foregoing, (a) Energenics is not authorized to manufacture, offer                for                sale or sell O2Diesel Additive as such; (b) Energenics shall not                grant                sublicenses under the O2Diesel Intellectual Property to any Third                Party                without the written consent of O2Diesel, which consent not to be                unreasonably withheld; and (c) Energenics shall not challenge the                validity                or enforceability of the O2Diesel Intellectual Property. |
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| 6.2   | **Third                Party Infringement**.                Energenics shall inform O2Diesel of any infringement by any Third                Party of                any of the O2Diesel Intellectual Property in the Territory of which                it                becomes aware. O2Diesel may, but shall not be required to, take legal                action to enforce the O2Diesel Intellectual Property against infringement                by Third Parties and defend the O2Diesel Intellectual Property against                challenges by Third Parties. Energenics shall cooperate fully with                O2Diesel in any such enforcement or defense and supply all assistance                reasonably requested by O2Diesel in carrying on such action, at O2Diesel’s                expense, including by using commercially reasonable efforts to have                its                employees testify when requested and to make available relevant records,                information, specimens and the like. |
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| 6.3   | **Joint                Improvements**.                To the extent that employees of O2Diesel or its Affiliates together                with                employees of Energenics or its Affiliates jointly invent or discover                any                improvements to the O2Diesel Additive, O2Diesel Product or to any                other                invention, discovery, know-how or technology, the Parties shall jointly                own the same, and each Party shall be free to exploit or authorize                the                exploitation of the same without the consent of or accounting to                the other                Party, subject to any other relevant intellectual property rights                of the                other Party. If a Party becomes aware of any such joint invention,                discovery, know-how or technology, it shall verify that the other                Party is                aware of the same and the parties shall consult and cooperate with                respect                to the protection of the same. |
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| 6.4   | **Energenics                Improvements**.                Before commencing any research or testing efforts with respect to                the                oxygenation of diesel fuel, the Party commencing such research/testing                (“**Research                Party**”)                shall disclose the same to the other Party. Subject to Section 6.3,                to the extent that the Research Party may during the Term invent                or                discover or otherwise acquire rights to any improvements to the O2Diesel                Additive, O2Diesel Product or any related know-how or technology                for the                oxygenation of diesel fuel, such Party shall promptly disclose the                same to                the other Party., and the grants of a worldwide, perpetual, royalty-free,                paid-up, nonexclusive license to practice and authorize the practice                of                such improvements and other know-how and technology shall be agreed                to by                the Parties. |
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| 6.5   | **Patent                Marking****.**                Energenics shall, if applicable, comply with any laws and regulations                in                the Territory concerning the marking or other identification of O2Diesel                Product as being patented. |
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**7.**
**Representations      and Warranties**
**.**

| 7.1   | **Representations                and Warranties of Both Parties****.**                Each Party represents and warrants                that: |
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| 7.1.1   | it                is a company duly organized, validly existing and in good standing                under                the laws of, in the case of O2Diesel, the state of Delaware, and                in the                case of Energenics, Singapore; |
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| 7.1.2   | the                execution of this Agreement on its behalf has been properly authorized                by                all necessary corporate action; |
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| 7.1.3   | this                Agreement is valid and binding on it and enforceable against it in                accordance with the terms hereof, subject to applicable bankruptcy                and                similar laws affecting creditors’ rights and remedies generally, and                subject, as to enforceability, to general principles of equity; |
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| 7.1.4   | neither                the execution nor the performance of this Agreement will constitute                a                breach or violation of the terms of its charter or organizational                documents or any contract, agreement or other commitment to which                it is a                party or by which it or any of its properties are                bound; |
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| 7.1.5   | there                are no bankruptcy,                insolvency, receivership or similar proceedings involving it or any                of its                Affiliates either pending or being contemplated, or any other pending                or                threatened actions, suits, arbitrations or other proceedings by or                against                it; |
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| 7.1.6   | its                business is being conducted in compliance in all material respects                with                all applicable laws and regulations;                and |
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| 7.1.7   | it                is not in default with respect to any governmental or court order                and                there are no pending lawsuits or unsatisfied judgments against                it. |
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| 7.2   | **Representations                and Warranties of****Energenics**.                Energenics represents and warrants that: (a) Energenics is experienced                in                fuel distribution; (b) Energenics has had a reasonable opportunity                to, and has in fact, investigated independently its business prospects                under this Agreement before entering into this Agreement; (c) Energenics                is not relying upon any information, representation or warranty provided                by O2Diesel except as expressly set forth in this Agreement; and                (d)                Energenics is not relying upon O2Diesel’s providing significant assistance                with or control over Energenics’s method of operation under this                Agreement. |
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| 7.3   | **Representations                and Warranties of O2Diesel****.** |
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| 7.3.1   | O2Diesel                warrants that the O2Diesel Additive delivered to Energenics hereunder                complies with O2Diesel’s specifications for such product, provided that                Energenics notifies O2Diesel of any defects therein within thirty                (30)                days after taking delivery thereof. Energenics’s exclusive remedy for a                breach of this Section 7.3 shall be, at O2Diesel’s option, a refund                of any amounts already paid for the nonconforming O2Diesel Additive                or                prompt redelivery of the same quantity of conforming O2Diesel                Additive. |
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| 7.3.2   | O2Diesel                represents and warrants that it has the right title interest in the                O2Diesel Additive and O2Diesel Product and it has the right to distribute                O2Diesel Additive and/or O2Diesel Product. O2Diesel (as contemplated                in                this agreement) represents and warrants that the O2Diesel Additive                and                O2Diesel Product are fit for the purposes for which they would ordinarily                be used and are free from any defect of manufacturing and material.                O2Diesel further represents and warrants that all the O2Diesel Trademarks                and Intellectual Property are registered in the name of O2Diesel                and that                the use of such Trademark and Intellectual Property by O2Diesel or                Energenics does not violate in any manner whatsoever or infringe                any third                party's right or intellectual                property. |
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| 7.3.3   | To                the best of its knowledge, O2Diesel has disclosed in its public filings,                all technical and logistical issues relating to the O2Diesel Additive. |
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**8.**
**Indemnification**
**.      **

| 8.1   | **In                General****.**                Each Party (the **“Indemnifying                Party”**)                shall defend, indemnify and hold harmless the other Party (the                **“Indemnified                Party”**),                its Affiliates, and its and their employees, officers, directors,                agents,                distributors and licensees against any loss, damage, expense, or                cost,                including reasonable attorneys fees, arising out of any claim, demand,                action, suit, investigation, arbitration or other proceeding by a                Third                Party (an **“Action”**)                based on (a) the Indemnifying Party’s breach of this Agreement; (b)                negligence, willful misconduct or violation of any law or regulation                by                the Indemnifying Party, its Affiliates, or its or their employees,                officers, directors, or agents;                or (c) the Indemnifying Party’s manufacture, use, sale, handling, storage,                transportation or disposal of O2Diesel Additive, O2Diesel Product                or other                products. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 8.2   | **Procedure****.** If                an Indemnified Party becomes aware of any Action it believes is                indemnifiable under Section 8.1, (a) the Indemnified Party shall give                the Indemnifying Party prompt written notice of such Action; (b) the                Indemnifying Party shall assume, at its expense, the sole defense                of such                claim or cause of action through counsel selected by it and reasonably                acceptable to the Indemnified Party, except that in the case of a                conflict                of interest between the Parties, the Indemnifying Party shall, at                the                Indemnifying Party’s expense, provide separate counsel for the Indemnified                Party selected by the Indemnified Party; (c) the Indemnifying Party                shall                maintain control of such defense, including any decision as to settlement,                except that any settlement of an Action shall require the written                consent                of both Parties, which consent shall not to be withheld or delayed                unreasonably; (d) the Indemnified Party may, at its option and                expense, participate in such defense, and in any event, the Parties                shall                cooperate with one another in such defense; and (e) the Indemnifying                Party                shall bear the total costs of any court award or settlement in such                Action. |
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| **9.  ** | **Insurance****. **Energenics                shall during the Term maintain general liability and product insurance                as                per Singapore law covering at least claims arising out of the manufacture,                use, sale, handling, storage, transportation and disposal of O2Diesel                Product by Energenics. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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**10.**
**Limitation      of Liability**
**.      **

| 10.1   | Neither                party shall be liable to the other party                for any indirect, incidental, special, consequential or punitive                damages                arising out of or related to this Agreement, even if the party has                been                advised of the possibility thereof. O2Diesel’s liability to Energenics for                other damages, if any, shall in no event exceed the total amount                distributor has paid to O2Diesel for any product or service giving                rise to                a claim of liability. |
|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 10.2   | The                Parties have agreed that Energenics shall not in any circumstance                whatsoever be liable for the O2Diesel Additive and the O2Diesel Product                to                O2Diesel or to any third party for any deficiency in the product                so long                as it uses the product per the instructions provided by                O2Diesel. |
|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**11.**
**Term      and Termination**
**.      **

| 11.1   | **Term**. |
|------------------|-----------|

| 11.1.1   | This                Agreement shall commence as of the Effective Date and, unless terminated                as provided in Section 11.2, continue in full force and effect for                an                initial term of five (5) years (the “**First                Term**”).                Upon expiry of the First Term, this Agreement shall be automatically                renewed for another term of five (5) years (the “**Second                Term**”),                unless written notice is provided to O2Diesel by Energenics at least                six                (6) months prior to the termination of the First Term. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.1.2   | Notwithstanding                the above, if O2Diesel proposes to sell the assets and intellectual                property, unless pursuant to a Change of Control, with respect to                O2Diesel                Additive and/or O2 Diesel Product, in the territory, Energenics shall                have                the first right of refusal with respect to any such transfer, sale                or                disposal. The consideration for such transfer shall be determined                by                independent valuation by an independent registered public accounting                firm                who is not appointed by either party as its advisor or                auditors. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.2   | **Termination                for Default**.                If either Party materially breaches this Agreement and fails to cure                the                breach within thirty (30) days after receiving written notice thereof                from                the other Party, the other Party may terminate this Agreement upon                further                written notice to the breaching Party at any time that the breach                remains                uncured. Either Party may terminate this Agreement if it has reasonable                grounds for insecurity concerning the other Party’s future performance and                does not receive reasonably adequate assurance of performance within                ten                (10) days after giving written notice demanding the                same. |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **11.3  ** | **Rights                and Obligations of Parties upon Expiration and                Termination****.** |
|----------------------|----------------------------------------------------------------------------------------------------------|

| 11.3.1   | Termination                of this Agreement by either Party for any reason shall not affect                and                shall be without prejudice to the rights and obligations of the Parties                accrued prior to the effective date of termination. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 11.3.2   | To                the extent that Energenics has outstanding orders for O2Diesel Additive                at                the expiration or termination of this Agreement, such orders shall                be                deemed cancelled unless O2Diesel notifies Energenics within thirty                (30)                days after expiration or termination that it will deliver the ordered                quantity of O2Diesel Additive. If O2Diesel so honors such orders,                Energenics shall take and pay for the O2Diesel Additive in accordance                with                the provisions of this Agreement. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.3.3   | Within                thirty (30) days after the expiration or termination of this Agreement,                Energenics shall notify O2Diesel of the quantity of O2Diesel Additive                that                Energenics then has on hand (“**Remaining                Quantity**”).                Energenics shall have the right to use such O2Diesel Additive to                make and                sell O2Diesel Product subject to the applicable terms of this Agreement,                but in no event shall such right continue for longer than six (6)                months                after the date of expiration or termination. If Energenics does not                use                the Remaining Quantity, O2Diesel shall have the option to purchase                from                Energenics the Remaining Quantity at the same price Energenics paid                for                such O2Diesel Additive. After the expiration or termination of the                Agreement and any further period of distribution permitted under                this                Section 11.3.3, Energenics shall take no action that would infringe                O2Diesel Intellectual Property or use O2Diesel Confidential Information. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.3.4   | After                the expiration or termination of this Agreement and any further period                of                distribution permitted under Section 11.3.3, Energenics shall, within                thirty (30) days after O2Diesel’s request, return to O2Diesel or destroy                any materials provided by O2Diesel and any excess marketing materials                for                O2Diesel Product. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.3.5   | The                provisions of Sections 2.5, 3 (for so long as any amounts payable                remain                unpaid) and 11.3 and Articles 4 through 8, 10, and 12 through 14                of this                Agreement shall survive the expiration or termination of this                Agreement. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**12.**
**Dispute      Resolution**
**.**

| 12.1   | **Discussions****.**                The Parties shall use reasonable efforts to amicably resolve any                disputes                arising out of or relating to this Agreement by direct discussions                between                them. |
|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.2   | **Arbitration                of Disputes****.**                Any dispute not resolved as set forth in Section 12.1 within fifteen                (15) days after one Party notifies the other Party that it wishes                to                discuss the matter (**“Dispute”**),                shall be resolved by arbitration. The venue of the arbitration shall                be                London, United Kingdom and the arbitration shall be governed by the                Rules                of the London Court of Arbitration. The language of the arbitration                shall                be English language. |
|------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.3   | **Arbitration                Procedures****.**                The arbitration shall be presided by a panel of three (3) arbitrators.                Each Party shall appoint one arbitrator and the third arbitrator                shall be                appointed by the two arbitrators so appointed by the                Parties. |
|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 12.4   | **Judicial                Action**.                Notwithstanding the above, either Party may seek from any court having                jurisdiction hereof any interim, provisional or injunctive relief                or                specific performance that may be necessary to protect the rights                or                property of any Party or to maintain the status quo before, during                or                after the pendency of the arbitration proceeding. The institution                and                maintenance of any judicial action or proceeding for any such interim,                provisional or injunctive relief shall not constitute a waiver of                the                right or obligation of either Party to submit the dispute to arbitration,                including any claims or disputes arising from the exercise of any                such                interim, provisional or injunctive                relief. |
|------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**13.**
**Notices**
**.**

| 13.1   | **Delivery                of Notices**.                All notices sent under this Agreement shall be in writing and (a)                hand                delivered; (b) transmitted by legible facsimile with a copy sent                concurrently by certified mail, return receipt requested; or (c)                delivered                by prepaid priority delivery                service. |
|------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13.2   | **Addresses                for Notices**.                Notices shall be sent to the Parties at the following addresses or                such                other addresses as the parties subsequently may                provide: |
|------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| If                to O2Diesel:                 | 100                Commerce DriveSuite                301Newark,                Delaware 19713 |
|------------------------------------------------|------------------------------------------------------------------------------------------------|
|                                           |                                                                                           |
| Attention:                                | Alan                Rae                                                                        |
| Telephone:                                     | (302)                266-6000                                                                  |
| Fax:        | (302)                266-7076                                                                  |
|                                           |                                                                                           |
|                                           |                                                                                           |
| If                to Energenics:               | 7                Temasek Boulevard                                                             |
|                                           | Suntec                City Tower 1 #04-01A                                                     |
|                                           | Singapore                038987                                                                |
|                                           |                                                                                           |
| Attention:                                | Ronen                Hazarika                                                                  |
| Telephone:                                     | +65                6415 1650                                                                   |
| Fax:        | +65                6415 1656                                                                   |
|                                           |                                                                                           |

**14.**
**Miscellaneous**
**.      **

| 14.1   | **Relationship                Between Parties****.**                O2Diesel and Energenics are separate business entities, and shall                not be                considered as joint ventures, partners, agents, servants, employee,                or                fiduciaries of each other. Neither this Agreement nor the relationship                between the Parties shall be considered in any way to deem Energenics                a                franchisee of O2Diesel for any purpose whatsoever. The Parties                specifically agree that any obligation to act in good faith and to                deal                fairly with each other which may be implied in law shall be deemed                satisfied by the Parties’ compliance with the express terms of this                Agreement. |
|------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.2   | **Technical                Services Agreement****.**                Within thirty (30) days of the Closing, the Parties shall enter into                a                Technical Services Agreement that will establish the terms for the                reimbursement of any technical services provided by O2Diesel in the                Territory. |
|------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 14.3   | **Compliance                with Laws**.                In obtaining necessary government approvals and in other aspects                of                Energenics’s business relating to O2Diesel Product, Energenics shall: (a)                in compliance with the U.S. Foreign Corrupt Practices Act, Title                15 United                States Code § 78dd, not directly or indirectly pay, give, offer or promise                any money, gift or anything else of value to (i) any officer or employee                of any government or any department, agency, or instrumentality thereof,                (ii) any person acting in an official capacity for or on behalf of                any                foreign government or any department, agency, or instrumentality                thereof,                (iii) any political party, or (iv) any candidate for political office                (collectively “**Governmental                Official**”),                or to any family member of any Governmental Official, to influence                any act                or decision of such Governmental Official, induce such Governmental                Official to do or omit to do any act in violation of the lawful duty                of                such Governmental Official, or secure any advantage in obtaining,                retaining or directing business for or with any Person; (b) not export                or                reexport any information, products or other items in violation of                U.S.                export control laws and regulations; and (c) comply with the conditions                of                any applicable governmental approvals and all other applicable laws                and                regulations. |
|------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.4   | **Governing                Law; Jurisdiction**.                This Agreement shall be governed and construed in accordance with                English                Law. Subject to the arbitration clause set out above, the High Court                in                London shall have jurisdiction with respect to any matter/dispute                arising                out of this Agreement. |
|------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.5   | **Recordkeeping                and Inspection**.                During the Term and for three (3) years thereafter, or such longer                period                as may be required by law, Energenics shall keep and maintain reasonable                records of all agreements, approvals and other activities relating                to this                Agreement. O2Diesel may, at its expense, during regular business                hours and                with reasonable prior notice, examine, review, and inspect all facilities                in which O2Diesel Additive or O2Diesel Product is stored, blended                or                distributed by or on behalf of Energenics, and review, audit and                analyze                Energenics’s records relating to this Agreement and representative samples                of O2Diesel Additive and O2Diesel Product in Energenics’s custody or                control. |
|------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.6   | **Force                Majeure****.**                Neither Party shall be liable for the consequences of any failure                to                perform, or default in performing, any of its obligations under this                Agreement, if that failure or default is caused without the fault                or                negligence of the Party by any act of “Force Majeure.” For the purposes of                this Agreement, “**Force                Majeure**”                shall mean war (whether declared or not); act of God; revolution;                acts or                omissions of third parties beyond the control of either Party; faulty                or                impassable roads; invasion; insurrection; riot; civil commotion;                sabotage;                military or usurped power; lightning; explosion; fire; storm; drought;                flood; earthquake; epidemic; quarantine; strikes; acts or restraints                of                governmental authorities; inability to secure materials, machinery,                equipment or labor; and laws and regulations of any governmental                authority. |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 14.7   | **Severability****.**                The provisions of this Agreement are severable, and the unenforceability                of any provision of this Agreement shall not affect the enforceability                of                the remainder of this Agreement. The Parties acknowledge that it                is their                intention that if any provision of this Agreement is determined by                a court                to be unenforceable as drafted, that provision should be construed                in a                manner designed to effectuate the purpose of that provision to the                greatest extent possible under applicable                law. |
|------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.8   | **Construction                of Agreement****.**                The Parties acknowledge that they thoroughly have reviewed this Agreement                and bargained over its terms. Accordingly, this Agreement shall be                construed without regard to the Party or Parties responsible for                its                preparation and shall be deemed to have been prepared jointly by                the                Parties. |
|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.9   | **Cumulative                Rights and Remedies****.**                The rights and remedies provided in this Agreement and all other                rights                and remedies available to either Party at law or in equity are, to                the                extent permitted by law, cumulative and not exclusive of any other                right                or remedy now or hereafter available at law or in equity. Neither                asserting a right nor employing a remedy shall preclude the concurrent                assertion of any other right or employment of any other remedy, nor                shall                the failure to assert any right or remedy constitute a waiver of                that                right or remedy. |
|------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.10   | **Assignment****.**No                Party shall transfer or assign any of its rights, including by a                Change of                Control, under this Agreement to any Third Party without the prior                written                consent of the other Party, provided that if Energenics enters into                a                sub-distributor arrangement with Affiliates of Energenics, the terms                and                conditions of the sub-distributorship shall be same as the terms                and                conditions set out in this Agreement. |
|-------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.11   | **Amendments****.**                This Agreement may be modified or amended only by written agreement                of the                Parties. |
|-------------------|------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.12   | **Entire                Agreement**.                This Agreement constitutes the entire agreement between the Parties                concerning the subject matter of this Agreement and supersedes all                prior                agreements between the Parties concerning the subject matter                hereof. |
|-------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 14.13   | **Counterparts****.**This                Agreement may be executed in any number of counterparts, each of                which                when so executed shall be deemed to be an original and all of which                when                taken together shall constitute this                Agreement. |
|-------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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**O2DIESEL      CORPORATION**

**ENERGENICS      PTE LIMITED**

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**SCHEDULE      A**

**SALES      TARGETS**

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