Exhibit 10.13






AMENDMENT TO EMPLOYMENT AGREEMENT








WHEREAS, on January 1, 2008, Axion International Inc.,  a
Delaware  corporation (“Company”), and James Kerstein (“Executive”),
entered into an Employment Agreement (the “Agreement”); and




WHEREAS, in order to comply with Section 409A of the Internal Revenue
Code of 1986, as amended (the “Code”), and the Department of Treasury
Regulations and other interpretive guidance promulgated thereunder
(collectively, “Section 409A”), Company and Executive desire to amend the
relevant terms and provisions of the Agreement.




NOW, THEREFORE, to effectuate the foregoing changes related to Section
409A, Company and Executive agree:




1.         Section 2.2 of the
Agreement is amended and, as amended, reads as follows:




2.2           Bonus.  In
addition to the Executive’s Base Salary, the Company may pay to the Executive
during the Employment Term an annual bonus (the “Annual Bonus”) based upon the
Executive’s performance, the amount of which bonus (if any) shall be solely
within the discretion of the Company as determined by the Board.  The
Annual Bonus shall be paid no later than the end of the calendar year following
the calendar year in which the last of the services relating to such Annual
Bonus were performed.




2.         Section 5.1.1(b) of
the Agreement is amended and, as amended, reads as follows:




(b)           If,
prior to the expiration of the Employment Term, the Executive’s employment with
the Company is terminated by the Company Without Cause or by the Executive for
Good Reason, subject to Section 5.5 of the Agreement, the Executive shall be
entitled only to (i) his Accrued Base Salary through and including the date of
termination; (ii) his Base Salary from the day after the termination date
through the normal expiration date of the Employment Term, payable in equal
installments on the same terms as at the end of the Employment Term; and (iii)
the benefits set forth under Section 3 of this Agreement through the normal
expiration date of the Employment Term.




3.         Sections 5.1.1(d) and
(e) of the Agreement are amended and, as amended, read as follows:




(d)           If
the Executive’s employment is due to the death of the Executive, subject to
Section 5.5 of the Agreement, the Executive (or his estate) shall be entitled
only to (i) payment of his Accrued Base Salary through and including the date of
death and (ii) six (6) months of his Base Salary as severance, payable in equal
installments on the same terms as at the end of the Employment
Term.




(e)           Notwithstanding
anything to the contrary herein, subject to Section 5.5 of the Agreement, the
Company may elect, in its sole discretion, to pay any remaining installments of
severance or other payments hereunder in a lump sum rather than in installments
over time, provided that any such lump sum payment be paid no later than 60 days
after the date upon which the right to receive the payment
occurred.




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4.         A new Section 5.5 is
added to the Agreement and, as added, reads as follows:




5.5       Section 409A.




(i)         Anything in this
Agreement to the contrary notwithstanding, if on the date of termination of
Executive’s employment with Company,




(A)       Executive would not have a separation
from service within the meaning of Section 409A(a)(2)(A)(i) (“Separation From
Service”) of the Internal Revenue Code of 1986, as amended (the “Code”), and as
a result of such termination of employment would receive any payment that,
absent the application of this Section 5.5(i)(A), would be subject to
additional tax imposed pursuant to Section 409A(a) of the Code, then such
payment shall instead be payable on the date that is the earliest of (1)
Executive’s Separation From Service, (2) the date the Executive becomes disabled
(within the meaning of Section 409A(a)(2)(C) of the Code), (3) the
Executive’s death, or (4) such other date as will not result in such
payment being subject to such additional tax; and if




(B)       Executive is a specified employee within
the meaning of Section 409A(a)(2)(B)(i) of the Code and would receive any
payment sooner than six months after Executive’s Separation From Service that,
absent the application of this Section 5.5(i)(B), would be subject to additional
tax imposed pursuant to Section 409A(a) of the Code as a result of such status
as a specified employee, then such payment shall instead be payable on the date
that is the earliest of (1) six months after Executive’s Separation From
Service, (2) the Executive’s death, or (3) such other date as will not
result in such payment being subject to such additional tax.




(ii)        It is the intention of the
parties that payments or benefits payable under this Agreement not be subject to
the additional tax imposed pursuant to Section 409A of the Code.  To the
extent such potential payments or benefits could become subject to such Section,
the parties shall cooperate to amend this Agreement with the goal of giving
Executive the economic benefits described herein in a manner that does not
result in such tax being imposed.




(iii)       For purposes of Section 409A, the
Executive's right to receive installment payments under the Agreement shall be
treated as a right to receive a series of separate and distinct
payments.




(iv)     In the event that a payment or benefit
payable under this Agreement is subject to the additional tax imposed by Section
409A of the Code, and Executive has not been uncooperative in any attempts of
the Company to amend this Agreement to avoid such additional tax, Company shall
(at Executive’s option) pay directly, or reimburse Executive for such additional
tax and any interest and penalty related thereto (the “409A Amounts”) within 10
days of Executive’s submission to Company of the taxing authority’s
determination of amounts due, and in the case of Executive’s payment, evidence
of such payment.  At the same time as Company’s payment or reimbursement,
Company shall pay Executive a gross-up amount to cover income, excise, and other
applicable taxes on the 409A Amounts and on the gross-up amount (before this
further gross-up).  For purposes of calculating the gross-up amounts for
taxes, the Executive shall be deemed to be taxed at the highest marginal rate
under all applicable local, state, federal, and foreign tax laws for which the
payment is made.




5.         Section 6 of the
Agreement is amended and, as amended, reads as follows:




6.           PERMANENT
DISABILITY




If, prior to
the expiration of the Employment Term, the Executive shall fail because of
illness, physical or mental disability or other incapacity, for a period of
three (3) consecutive months, or for shorter periods aggregating three (3)
months during any twelve-month period, to render the services provided for by
this Agreement, then the Company may, by written notice to the Executive after
the last day of the third consecutive month of disability or the day on which
the shorter periods of disability equal an aggregate of three (3) months,
terminate the Executive’s employment for “ Permanent Disability ”, specifying a
termination date no earlier than ten (10) business days after the date on which
such notice is given. The determination of the Executive’s illness, physical or
mental disability or other incapacity for purposes of determining Permanent
Disability shall be made by an independent physician who is reasonably
acceptable to the Executive and the Company and shall be final and binding and
shall be based on such competent medical evidence as shall be presented to it by
the Executive or by any physician or group of physicians or other competent
medical experts employed by the Executive and/or the Company to advise such
independent physician.




In the event
of a termination of the Executive’s employment by the Company for Permanent
Disability, subject to Section 5.5 of the Agreement, the Executive shall be
entitled only to (i) his Accrued Base Salary through and including the date of
termination, (ii) six months of his Base Salary as severance, payable in equal
installments on the same terms as at the end of the Employment Term and (iii)
receive the benefits set forth under Section 3 of this Agreement during the
six-month severance period.




Except as
otherwise provided in this Section 6, following the effective date of a
termination for Permanent Disability, the Company shall have no further
obligation to the Executive under this Agreement.




6.         All other terms of the
Agreement remain the same.








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IN WITNESS
WHEREOF, the parties have executed this amendment to the Agreement effective
December 30, 2008.








EMPLOYER :




AXION INTERNATIONAL INC.


By:      /s/Michael W
Johnson


Michael W Johnson








EXECUTIVE:


/s/ James
Kerstein


James Kerstein






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