11701
                Mt. Holly Rd., Charlotte, NC
                28214

            


    

    


    William
      J. McMahon

    Chief
      Executive Officer

    (704)
      812-4060

     

    September
      15, 2008

     

    Acorn
      Energy, Inc.

    4
      W.
      Rockland Road

    P.
      O. Box
      4

    Montchanin,
      DE 19710

     

    Gentlemen,

     

    Secondment
      of Joe B. Cogdell, Jr. to Acorn Energy, Inc.

     

    In
      this
      letter:

     

    “Acorn”
      means
      Acorn Energy, Inc.;

     

    “CoaLogix”
means
      CoaLogix, Inc.; 

     

    “Employment
      Agreement”
      means
      the employment agreement dated September __, 2008 among Joe B. Cogdell, Jr.,
      Acorn and CoaLogix;

     

    “Secondee”
means
      Joe B. Cogdell, Jr.

     

    The
      purpose of this letter is to set out the terms which have been agreed between
      Acorn and CoaLogix concerning the secondment of the Secondee to Acorn. This
      letter is the “Services Agreement” referenced in the Employment
      Agreement.

     

    We
      are
      pleased to confirm our agreement to place the Secondee on secondment at Acorn
      providing services as Vice President, General Counsel and Secretary consistent
      with those set forth in the Employment Agreement pertaining to work by the
      Secondee. The secondment will commence on January 5, 2009 and, unless sooner
      terminated, will continue for a period corresponding with the term of the
      Employment Agreement.

     

    1. Secondee’s
      Status

     

    During
      the secondment, the Secondee will remain an employee of CoaLogix under the
      terms
      and conditions of his employment or engagement with CoaLogix. CoaLogix will
      pay
      or provide Secondee all compensation, bonus, other amounts and benefit
      entitlements to which he is entitled in accordance with its normal policies
      and
      procedures. Except for the stock options for 120,000 shares of common stock
      of
      Acorn referenced in the Employment Agreement, the Secondee will not be entitled
      to any compensation from Acorn, and he shall not be entitled to participate
      in
      any Acorn benefits or benefit plans. CoaLogix shall be responsible for all
      tax
      withholdings and other deductions required by law relating to the Secondee,
      and
      for all workers’ compensation, unemployment obligations, and other statutory
      obligations regarding employment relating to the Secondee.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    The
      Secondee will during the secondment be bound by CoaLogix’s general requirements
      of its own employees, and CoaLogix will immediately inform Secondee that he
      will
      be subject to compliance with all of CoaLogix’s workplace conduct policies,
      standards and procedures.

     

    2. Authority
      and Control

     

    The
      Secondee will have the authority to act on behalf of Acorn in the day-to-day
      operations of Acorn as provided in the Employment Agreement. Secondee shall
      be
      subject to the direction of Acorn’s Chief Executive Officer with regard to the
      services provided to Acorn.

     

    It
      is
      anticipated that the Secondee will be providing services to both CoaLogix and
      Acorn during the term of the Employment Agreement. The Secondee shall, at all
      times during the secondment, be under the day-to-day control of Acorn with
      respect to his duties for Acorn as set forth in the Employment
      Agreement.

     

    3. Compensation
      Costs and Expenses

     

    Acorn
      will reimburse CoaLogix for Secondee’s salary, benefits, vacation, training,
      expenses (not project related), other than bonus amounts as provided below,
      based on the allocation of time spent by Secondee in performing services for
      Acorn and CoaLogix. The initial allocation of compensation costs and expenses
      is
      that fifty (50) percent of Secondee’s compensation costs and expenses will be
      allocated to Acorn which will reimburse this amount to CoaLogix. This allocation
      will be adjusted every six (6) months based on the services provided in the
      previous six (6) months as agreed by the CEOs of Acorn and CoaLogix and if
      not
      agreed, will be determined by the Board of Directors of CoaLogix.

     

    The
      CEO
      of Acorn and Acorn’s Board of Directors will set the bonus schedule for Secondee
      for services performed by Acorn, with the target amount being fixed at 30%
      of
      the amount of Secondee’s base salary that is allocated to Acorn. The terms will
      be set at the beginning of the year with the allocation of the bonus cost to
      Acorn to be based on the amount of service to Acorn in the prior 12 months.
      For
      the first year, the allocation will be set at fifty (50) percent and Acorn
      shall
      reimburse CoaLogix for the Secondee bonus expense allocable to
      Acorn.

     

    Under
      the
      Employment Agreement, either party has the right to terminate the Secondee
      from
      employment. 

     

    In
      the
      event of an Involuntary Termination of employment, as defined in the Employment
      Agreement, if only one party initiates the Involuntary Termination and the
      other
      party does not agree to take full responsibility for the Secondee’s compensation
      costs and expenses, the party initiating the Involuntary Termination shall
      be
      solely responsible for all severance due and any other costs under the
      Employment Agreement. If that party is Acorn, it shall reimburse CoaLogix for
      any severance and other costs incurred by CoaLogix in connection with the
      Involuntary Termination.

     

    If
      both
      parties agree to the Involuntary Termination, the severance and other costs
      shall be allocated based upon the services provided by Secondee in the prior
      twelve (12) months and Acorn shall reimburse CoaLogix for its allocated shares
      of such severance and other costs.


    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    Costs
      and
      expenses for specific projects undertaken by Secondee on behalf of either party
      will be paid for by the party receiving the services and Acorn shall reimburse
      CoaLogix for any such costs and expenses paid by CoaLogix on specific projects
      of Acorn.

     

    4. Termination
      of Secondment

     

    Either
      CoaLogix or Acorn may terminate the secondment by giving not less than thirty
      days advance notice in writing to the other at any time, notwithstanding the
      terms of the Employment Agreement.

     

    The
      secondment shall terminate automatically, without notice to either party, upon
      the termination of the Employment or in the event the Secondee’s employment or
      engagement with CoaLogix terminates for any reason. In the event such employment
      with CoaLogix is terminated, CoaLogix shall provide prompt notice of same to
      Acorn.

     

    Acorn
      may
      terminate the secondment at any time with immediate effect by notice in writing
      to CoaLogix if:

     

    
      	 	
              ·

            	
              the
                Secondee engages in any misconduct or other conduct which, in the
                reasonable judgment of Acorn, affects or is likely to affect prejudicially
                the interests of Acorn; or

            


    

     

    
      	 	
              ·

            	
              the
                Secondee is unable properly to perform his duties by reason of ill-health,
                accident or otherwise for a period of thirty consecutive working
                days.

            


    

     

    Termination
      of the secondment shall not by itself terminate the Employment
      Agreement.

     

    5. Indemnities
      and Waivers

     

    Acorn
      will indemnify CoaLogix for and against all costs, claims, liabilities and
      expenses which CoaLogix incurs or suffers arising from claims made against
      it by
      third parties in respect of any act, omission or error of judgment (whether
      or
      not negligent or otherwise actionable) by the Secondee arising from the
      performance of his duties for Acorn during the secondment, but only if and
      to
      the extent the Secondee has acted in respect of such acts, omissions or errors
      in accordance with the directives of Acorn and its workplace standards of
      conduct.

     

    CoaLogix
      will indemnify Acorn for and against (i) all employment-related liabilities
      relating to compensation and benefits due or alleged to be due to the Secondee
      (whether arising out of or related to the Secondee’s employment with CoaLogix,
      the Secondee’s secondment to Acorn or otherwise), (ii) all damage, injury or
      loss caused by or resulting from any breach by CoaLogix of this Agreement or
      any
      violation by CoaLogix of any laws applicable to the secondment of the Secondee,
      and (iii) all costs, claims, liabilities and expenses which Acorn incurs or
      suffers arising from claims made against it by third parties in respect of
      any
      act, omission or error of judgment (whether or not negligent or otherwise
      actionable) of the Secondee during the Secondment, except for those acts or
      omissions during the course of and in furtherance of Secondee’s duties under the
      secondment that are in accordance with the directive of Acorn and its workplace
      standards of conduct.

     

    6. General

     

    Nothing
      in this letter shall constitute a partnership or joint venture between the
      parties nor have the effect of constituting the Secondee as an employee of
      Acorn. 


    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    The
      termination of the secondment as permitted in this letter shall not affect
      those
      provisions that are expressed to have continuing operation or effect after
      termination nor shall termination affect the waivers and indemnities contained
      in Section 5.

     

    This
      letter sets out the entire agreement and understanding of the parties pertaining
      to the secondment; however, the terms of the Employment Agreement are, to the
      extent consistent with this letter, incorporated herein by reference. In the
      event of any conflict between the terms of this letter and the Employment
      Agreement, the terms of the Employment Agreement shall control.

     

    The
      terms
      of this letter are governed by and construed in accordance with the laws of
      the
      State of North Carolina.

     

    Please
      confirm the acceptance of Acorn to the terms of this agreement by signing where
      indicated below.

     

    Yours
      sincerely,

     

    
      	
              /s/
                William J. McMahon

            	 	
              Date:
                September
                15, 2008

            
	
              William
                J. McMahon

            	 	 
	
              President
                & Chief Executive Officer

            	 	 
	 	 	 
	 	 	 
	
              For
                and on Behalf of Acorn

            	 	 
	 	 	 
	
              /s/
                John A. Moore

            	 	
              Date:
                September
                15, 2008

            
	
              Name:
                John A. Moore

            	 	 
	
              President
                & Chief Executive Officer

            	 	 
	 	 	 
	 	 	 
	
              Seen
                and Acknowledged:

            	 	 
	 	 	 
	 	 	 
	
              /s/
                Joe B. Cogdell, Jr.

            	 	
              Date:
                September
                15, 2008

            
	
              Name:
                Joe B. Cogdell, Jr.

            	 	 
	
              Secondee

            	 	 


    

     

    
      
        
        

      

      
        4