Document:

Form of Warrant

    Exhibit
      4.1

    
FORM
      OF WARRANT

    

      $_____Warrants

      [Name
        of
        Warrantholder]

     

    THIS
      WARRANT AND THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED
      UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). THESE SECURITIES HAVE
      BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH,
      THE
      DISTRIBUTION THEREOF. THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR
      TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT UNDER THE ACT IS IN EFFECT
      AS TO
      THESE SECURITIES OR (2) THERE IS AN OPINION OF COUNSEL, SATISFACTORY TO THE
      CORPORATION, THAT AN EXEMPTION THEREFROM IS AVAILABLE.

     

    H2
      DIESEL, INC. 

    WARRANT

    TO
      PURCHASE COMMON STOCK

    

    Issue
      Date: _________
      __, ______

     

    THIS
      WARRANT IS TO CERTIFY THAT,
      [Name
      of Warrantholder], a _______ corporation (the “Purchaser”), is entitled to
      purchase from H2 Diesel, Inc., a Delaware corporation (the “Company”),
_______
      shares
      of
      the Company’s Common Stock, par value $.0001 per share (the “Common Stock”), at
      the Exercise Price. This Warrant issued pursuant to that certain [Name of
      Agreement] dated as of ______ __, _____ between the Purchaser and the
      Company.

     

    Section
      1. Certain
      Definitions.

     

    As
      used
      in this Warrant, unless the context otherwise requires:

     

    “Charter”
shall
      mean the Certificate of Incorporation of the Company, as in effect from time
      to
      time.

     

    “Exercise
      Price”
shall
      mean $____ per share, as adjusted from time to time pursuant to Section 3
      hereof.

     

    “Securities
      Act”
shall
      mean the Securities Act of 1933, as amended.

     

    “Warrant”
shall
      mean this Warrant and all additional or new warrants issued upon division or
      combination of, or in substitution for, this Warrant. All such additional or
      new
      warrants shall at all times be identical as to terms and conditions and date,
      except as to the number of shares of Warrant Stock for which they may be
      exercised.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

      

        $_____Warrants

        [Name
          of
          Warrantholder]

      

    

     

    “Warrantholder”
shall
      mean the Purchaser, as the initial holder of this Warrant, and its nominees,
      successors or assigns, including any subsequent holder of this Warrant to whom
      it has been legally transferred.

     

    “Warrant
      Stock”
shall
      mean the shares of the Company’s Common Stock purchasable by the holder of this
      Warrant upon the exercise of such Warrant.

     

    Section
      2. Exercise
      of Warrant.

     

    (a) At
      any
      time after the consummation by the Company of its reverse merger with Wireless
      Holdings, Inc. but prior to the fifth anniversary of the Issue Date set forth
      above (the “Expiration Date”), the Purchaser may at any time and from time to
      time exercise this Warrant, in whole or in part. 

     

    (b) (i) The
      Warrantholder shall exercise this Warrant by means of delivering to the Company
      at its office identified in Section 14 hereof (i) a written notice of exercise,
      including the number of shares of Warrant Stock to be delivered pursuant to
      such
      exercise, (ii) this Warrant and (iii) payment equal to the Exercise Price in
      accordance with Section 2(b)(ii). In the event that any exercise shall not
      be
      for all shares of Warrant Stock purchasable hereunder, a new Warrant registered
      in the name of the Warrantholder, of like tenor to this Warrant and for the
      remaining shares of Warrant Stock purchasable hereunder, shall be delivered
      to
      the Warrantholder within ten (10) days after any such exercise. Such notice
      of
      exercise shall be in the Subscription Form set out at the end of this
      Warrant.

     

    (ii) The
      Warrantholder shall pay the Exercise Price to the Company either by cash,
      certified check to the order of the Company or wire transfer to an account
      specified by the Company. At any time following the first anniversary of the
      Issue Date and provided that the Warrant Stock is not then registered for resale
      pursuant to an effective registration statement under the Securities Act, then,
      in addition to the method of payment set forth in the immediately preceding
      sentence and in lieu of any cash payment required thereby, this Warrant may
      also
      be exercised at such time by means of a “cashless exercise” in which the
      Warrantholder shall be entitled to receive a certificate for the number of
      Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A),
      where:

     

    (A)
      = the
      Market Price (as defined below);

     

    (B)
      = the
      Exercise Price of this Warrant, as adjusted from time to time; and 

     

    (X)
      = the
      number of shares of Warrant Stock issuable upon exercise of this Warrant in
      accordance with the terms of this Warrant by means of a cash exercise rather
      than a cashless exercise.

     

    Solely
      for the purposes of this paragraph, Market Price shall be calculated as of
      the
      Trading Day (defined for this purpose as any day on which the equity securities
      markets are generally open for trading) immediately preceding the date which
      the

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

      
        
          $_____Warrants

          [Name
            of
            Warrantholder]

        

      

       

      subscription
        form attached hereto is deemed to have been sent to the Company pursuant
        to
        Section 14 hereof (such preceding date, the “Valuation Date”). As used herein,
        the phrase “Market Price” shall mean (i) if the  Warrant Stock is listed
        or admitted for
        trading on a national securities exchange, an automated quotation system
        or the
        Over the Counter Bulletin Board, the last reported sale price per share of
        the
        Warrant Stock on the Valuation Date, or, in case no such reported sale takes
        place on such day or is reported, then the average of the last reported per
        share bid and ask prices for shares of the Warrant Stock on such date (or
        if
        such bid and ask prices ore not available on such date, the most recent
        preceding date), in either case as officially reported by such securities
        exchange, quotation system or Bulletin Board on which the Common Stock is
        listed
        or admitted to trading, (ii) if not so listed or admitted for trading, the
        fair market value of a share of the Warrant Stock as determined by the Company’s
        board of directors in good faith, or (iii) if such exercise is in connection
        with a merger or consolidation of the Company in which the Company is not
        the
        survivor or in which the Warrant Stock is exchanged for cash or other securities
        or a sale of all or substantially all of the assets of the Company
        (collectively, a “Sale”), the implied price per share of the Warrant Stock
        resulting from such Sale.

    

     

    (c) Upon
      exercise
      of this
      Warrant and delivery of the Subscription Form with proper payment relating
      thereto, the Company shall cause to be executed and delivered to the
      Warrantholder a certificate or certificates representing the aggregate number
      of
      fully-paid and nonassessable shares of Warrant Stock issuable upon such
      exercise.

     

    (d) The
      stock
      certificate or certificates for Warrant Stock to be delivered in accordance
      with
      this Section 2 shall be in such denominations as may be specified in said notice
      of exercise and shall be
      registered in the name of the Warrantholder or such other name or names as
      shall
      be designated in said notice. Such certificate or certificates shall be deemed
      to have been issued and the Warrantholder or any other person so designated
      to
      be named therein shall be deemed to have become the holder of record of such
      shares, including to the extent permitted by law the right to vote such shares
      or to consent or to receive notice as stockholders, as of the time said notice
      is delivered to the Company as aforesaid.

     

    (e) The
      Company shall pay all expenses payable in connection with the preparation,
      issue
      and delivery of stock certificates under this Section 2; provided, however,
      that
      the Warrantholder shall be responsible for all transfer taxes resulting from
      the
      fact
      that
      any certificate issued in respect of Warrant Stock is not in the name of the
      Warrantholder. 

     

    (f) All
      shares of Warrant Stock issuable upon the exercise of this Warrant in accordance
      with the terms hereof shall be validly issued, fully paid and nonassessable,
      and
      free from all
      liens
      and other encumbrances thereon, other than liens or other encumbrances created
      by the Warrantholder or restrictions upon transfer under federal or state
      securities laws.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      $_____Warrants

      [Name
        of
        Warrantholder]

    

    (g) In
      no
      event shall any fractional share of Warrant Stock
      of the
      Company be issued upon any exercise of this Warrant. If, upon any exercise
      of
      this Warrant, the Warrantholder would, except as provided in this paragraph,
      be
      entitled to receive a fractional share of Warrant Stock, then the Company shall
      either (a) deliver in cash to such holder an amount equal to such fractional
      interest, or (b) issue a full share in lieu of such fractional
      share.

     

    Section
      3. Adjustment
      of Exercise Price and Warrant Stock.

     

    (a) If,
      at
      any time prior to the Expiration Date, the number of outstanding
      shares
      of Common Stock is (i) increased by a stock dividend payable in shares of
      Warrant Stock or by a subdivision or split-up of shares of Common Stock, or
      (ii)
      decreased by a combination of shares of Common Stock, then, following the record
      date fixed for the determination of holders of Common Stock entitled to receive
      the benefits of such stock dividend, subdivision, split-up, or combination,
      the
      Exercise Price shall be adjusted to a new amount equal to the product of (A)
      the
      Exercise Price in effect on such record date, and (B) the quotient obtained
      by
      dividing (x) the number of shares of Warrant Stock into which this Warrant
      would
      be exercisable on such record date (without giving effect to the event referred
      to in the foregoing clause (i) or (ii)), by (y) the number of shares of Warrant
      Stock which would be outstanding immediately after the event referred to in
      the
      foregoing clause (i) or (ii), if this Warrant had been exercised immediately
      prior to such record date.

     

    (b) Upon
      each
      adjustment of the Exercise Price as provided in Section 3(a), the Warrantholder
      shall thereafter be entitled to subscribe for and purchase, at the Exercise
      Price
      resulting from such adjustment, the number of shares of Warrant Stock equal
      to
      the product of (i) the number of shares of Warrant Stock into which this Warrant
      would be exercisable prior to such adjustment and (ii) the quotient obtained
      by
      dividing (A) the Exercise Price existing prior to such adjustment by (B) the
      new
      Exercise Price resulting from such adjustment.

     

    Section
      4. Division
      and Combination.

     

    This
      Warrant may be divided or combined with other Warrants upon presentation at
      the
      aforesaid office of the Company, together with a written notice specifying
      the
      names and denominations in which new Warrants are to be issued, signed by the
      Warrantholder or its agent or attorney. The Company shall pay all expenses
      in
      connection with the preparation, issue and delivery of Warrants under this
      Section 4. The Company agrees to maintain at its aforesaid office books for
      the
      registration of the Warrants.

     

    Section
      5. Reclassification,
      Etc.

     

    In
      case
      of any reclassification or change of the outstanding Warrant Stock of the
      Company (other than as a result of a subdivision, combination or stock
      dividend), or in case of any consolidation of the Company with, or merger of
      the
      Company into, another corporation or other business organization (other than
      a
      consolidation or merger in which the Company is the continuing corporation
      and
      which does not result in any reclassification or change of the outstanding
      Common Stock of the Company) at any time 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      
        $_____Warrants

        [Name
          of
          Warrantholder]

      

    

     

    
      prior
        to
        the Expiration Date, then, as a condition of such reclassification,
        reorganization, change, consolidation or merger, lawful provision shall be
        made,
        and duly executed documents evidencing the same from the Company or its
        successor shall be delivered to the Warrantholder, so that the Warrantholder
        shall have the right prior to the Expiration Date to purchase, at a total
        price
        not to exceed that payable upon the exercise of this Warrant, the kind and
        amount of shares of stock and other securities and property receivable upon
        such
        reclassification, reorganization, change, consolidation or merger by a holder
        of
        the number of shares of Warrant Stock of the Company which might have been
        purchased by the Warrantholder immediately prior to such reclassification,
        reorganization, change, consolidation or merger, and in any such case
        appropriate provisions shall be made with respect to the rights and interest
        of
        the Warrantholder to the end that the provisions hereof (including provisions
        for the adjustment of the Exercise Price and of the number of shares purchasable
        upon exercise of this Warrant) shall thereafter be applicable in relation
        to any
        shares of stock and other securities and property thereafter deliverable
        upon
        exercise hereof.

    

     

    Section
      6. Reservation
      and Authorization of Capital Stock.

     

    The
      Company shall, at all times on and after the date hereof, reserve and keep
      available for issuance such number of its authorized but unissued shares of
      Common Stock as will be sufficient to permit the exercise in full of all
      outstanding Warrants.

     

    Section
      7. Rights
      of
      Stockholders.

     

    Nothing
      contained herein be construed to confer upon the holder of this Warrant, as
      such, any of the rights of a stockholder of the Company or any right to vote
      for
      the election of directors or upon any matter submitted to stockholders at any
      meeting thereof, or to give or withhold consent to any corporate action (whether
      upon any recapitalization, issuance of stock, reclassification of stock, change
      of par value or change of stock to no par value, consolidation, merger,
      conveyance, or otherwise) or to receive notice of meetings, or to receive
      dividends or subscription rights or otherwise until the Warrant shall have
      been
      exercised and the certificates representing the Warrant Stock shall have been
      issued, as provided herein.

     

    Section
      8. Stock
      and
      Warrant Books.

     

    The
      Company will not at any time, except upon dissolution, liquidation or winding
      up, close its stock books or warrant books so as to result in preventing or
      delaying the exercise of any Warrant.

     

    Section
      9. Limitation
      of Liability.

     

    No
      provisions hereof, in the absence of affirmative action by the Warrantholder
      to
      purchase Warrant Stock hereunder, shall give rise to any liability of the
      Warrantholder to pay the Exercise Price or as a stockholder of the Company
      (whether such liability is asserted by the Company or creditors of the
      Company).

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      
        $_____Warrants

        [Name
          of
          Warrantholder]

      

    

    Section
      10. Transfer

     

    This
      Warrant may be transferred only upon the written consent of the Company, which
      approval shall not be unreasonably withheld or delayed. Any Warrants issued
      upon
      the transfer of this Warrant shall be numbered and shall be registered in a
      Warrant Register as they are issued. The Company shall be entitled to treat
      the
      registered holder of any Warrant on the Warrant Register as the owner in fact
      thereof for all purposes and shall not be bound to recognize any equitable
      or
      other claim to, or interest in, such Warrant on the part of any other person,
      and shall not be liable for any registration of transfer of Warrants that are
      registered or to be registered in the name of a fiduciary or the nominee of
      a
      fiduciary unless made with the actual knowledge that a fiduciary or nominee
      is
      committing a breach of trust in requesting such registration or transfer, or
      with the knowledge of such facts that its participation therein amounts to
      bad
      faith. This Warrant shall be transferable only on the books of the Company
      upon
      delivery thereof duly endorsed by the Holder or by his duly authorized attorney
      or representative, or accompanied by proper evidence of succession, assignment,
      or authority to transfer. In all cases of transfer by an attorney, executor,
      administrator, guardian, or other legal representative, duly authenticated
      evidence of his or its authority shall be produced. Upon any registration of
      transfer, the Company shall deliver a new Warrant or Warrants to the person
      entitled thereto. This Warrant may be exchanged, at the option of the Holder
      thereof, for another Warrant, or other Warrants of different denominations,
      of
      like tenor and representing in the aggregate a like amount, upon surrender
      to
      the Company or its duly authorized agent. Notwithstanding the foregoing, the
      Company shall have no obligation to cause Warrants to be transferred on its
      books to any person if, in the opinion of counsel to the Company, such transfer
      does not comply with the provisions of the Securities Act and the rules and
      regulations thereunder.

     

    Section
      11. Investment
      Representations; Restrictions on Warrant Stock; Registration.

     

    Unless
      a
      current registration statement under the Securities Act shall be in effect
      with
      respect to the Warrant Stock to be issued upon exercise of this Warrant, the
      Warrantholder, by accepting this Warrant, covenants and agrees that, at the
      time
      of exercise hereof, and at the time of any proposed transfer of Warrant Stock
      acquired upon exercise hereof, such Warrantholder will deliver to the Company
      a
      written statement that the securities acquired by the Warrantholder upon
      exercise hereof are for the account of the Warrantholder or are being held
      by
      the Warrantholder as trustee, investment manager, investment advisor or as
      any
      other fiduciary for the account of the beneficial owner or owners for investment
      and are not acquired with a view to, or for sale in connection with, any
      distribution thereof (or any portion thereof) and with no present intention
      (at
      any such time) of offering and distributing such securities (or any portion
      thereof). The Warrantholder agrees that certificates representing Warrant Stock
      may bear a legend substantially as follows:

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      
        $_____Warrants

        [Name
          of
          Warrantholder]

      

    

     

    
      
        

         

        THE
          SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
          THE
          SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). THESE SECURITIES HAVE BEEN
          ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH,
          THE
          DISTRIBUTION THEREOF. THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED
          OR
          TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT UNDER THE ACT IS IN EFFECT
          AS TO
          THESE SECURITIES OR (2) THERE IS AN OPINION OF COUNSEL, SATISFACTORY TO
          THE
          CORPORATION, THAT AN EXEMPTION THEREFROM IS
          AVAILABLE.

      

       

    

    The
      Company agrees to include the Warrant Stock in the Company’s registration
      statement to be filed with the Securities and Exchange Commission pursuant
      to
      the Registration Rights Agreement to be entered into between the Company and
      each of the investors in the Offering (as defined in the Amended and Restated
      Finders Agreement dated as of September 19, 2006 between the Company and the
      Purchaser).

     

    Section
      12. Loss,
      Destruction of Warrant Certificates.

     

    Upon
      receipt of evidence satisfactory to the Company of the loss, theft, destruction
      or mutilation of any warrant and, in the case of any such loss, theft or
      destruction, upon receipt of indemnity and/or security satisfactory to the
      Company or, in the case of any such mutilation, upon surrender and cancellation
      of such Warrant, the Company will make and deliver, in lieu of such lost,
      stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and
      representing the right to purchase the same aggregate number of shares of
      Warrant Stock.

     

    Section
      13. Amendments.

     

    The
      terms
      of this Warrant may be amended, and the observance of any term herein may be
      waived, but only with the written consent of the Company and the
      Warrantholder.

     

    Section
      14. Notices
      Generally.

     

    Any
      notice, request, consent, other communication or delivery pursuant to the
      provisions hereof shall be in writing and shall be sent by one of the following
      means: (i) by registered or certified first class mail, postage prepaid, return
      receipt requested; (ii) by facsimile transmission with confirmation of receipt;
      (iii) by overnight courier service; or (iv) by personal delivery, and shall
      be
      properly addressed to the Warrantholder at the last known address or facsimile
      number appearing on the books of the Company, or, except as herein otherwise
      expressly provided, to the Company at its principal executive office at H2
      Diesel, Inc., 20283 State Road 7, Suite 40, Boca Raton, Florida, Attention:
      Chief Executive Officer and
      an
      additional copy to Ira N. Rosner, Greenberg Traurig, P.A., 1221 Brickell Avenue,
      Miami, Florida 33131 (fax: (305) 579-0717),
      or such
      other address or facsimile number as shall have been furnished to the party
      giving or making such notice, demand or delivery.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      $_____Warrants

      [Name
        of
        Warrantholder]

    

    Section
      15. Successors
      and Assigns.

     

    This
      Warrant shall bind and inure to the benefit of and be enforceable by the parties
      hereto and their respective permitted successors and assigns.

     

    Section
      16. Governing
      Law.

     

    In
      all
      respects, including all matters of construction, validity and performance,
      this
      Warrant and the obligations arising hereunder shall be governed by, and
      construed and enforced in accordance with, the laws of the State of Florida
      applicable to contracts made and performed in such State.

     

    IN
      WITNESS WHEREOF,
      the
      Company has caused this Warrant to be signed in its name by its duly authorized
      officer.

     

    Dated:    _________________________    

     

    H2DIESEL,
      INC.

     

    

                                          

    By: __________________________________________________________________________________________    

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      $_____Warrants

      [Name
        of
        Warrantholder]

    

    SUBSCRIPTION
      FORM

     

    (to
      be
      executed only upon exercise of Warrant)

     

    To:     H2Diesel,
      Inc.

          20283
      State Road 7, Suite 40

         
Boca
      Raton, Florida 33499

            
    Attn:
      Lee S.
      Rosen

    

    or
      such
      other address notified by the Company to the Holder.

     

    (1)  The
      undersigned hereby elects to purchase ________ shares of Warrant Stock of the
      Company pursuant to the terms of the attached Warrant, and tenders herewith
      payment of the exercise price in full, together with all applicable transfer
      taxes, if any.

     

    (2)  Payment
      shall take the form of (check applicable box):

     

    [
      ] in
      lawful money of the United States; or

     

    [
      ] the
      cancellation of such number of shares of Warrant Stock as is necessary, in
      accordance with the formula set forth in subsection 2(b), to exercise this
      Warrant with respect to the shares of Warrant Stock set forth above pursuant
      to
      the cashless exercise procedure set forth in subsection 2(b).

     

    (3)  Please
      issue a certificate or certificates representing said shares of Warrant Stock
      in
      the name of the undersigned or in such other name as is specified
      below:

     

    _______________________________

     

    

    The
      shares of Warrant Stock shall be delivered to the following:

    

    _______________________________

     

    _______________________________

     

    _______________________________

    

    (4)
      Accredited
      Investor.
      The
      undersigned is an “accredited investor” as defined in Regulation D promulgated
      under the Securities Act of 1933, as amended.

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    [SIGNATURE
      OF HOLDER]

     

    Name
      of
      Investing Entity:
      ________________________________________________________________________

    Signature
      of Authorized Signatory of Investing Entity:
      __________________________________________________    

    Name
      of
      Authorized Signatory:
      ____________________________________________________________________ 

    Title
      of
      Authorized Signatory:
      _____________________________________________________________________ 

    Date:Exclusive License Agreement

    Exhibit
      10.1

    
 

    EXCLUSIVE
      LICENSE AGREEMENT

     

    THIS
      EXCLUSIVE LICENSE AGREEMENT (this “Agreement”) is entered into on this 20th day
      of March, 2006, by and between Ferdinando Petrucci, an individual residing
      at
      Via Stazione, 133A, Arce [Frosinone], Italy (“Licensor”), and H2Diesel, Inc., a
      Delaware corporation having its principal offices located at 17698 Foxborough
      Lane, Boca Raton, Florida 33496 (the “Licensee”), on behalf of which Mr. Lee
      Rosen is authorized to sign this Agreement.

    

    RECITALS

     

    
      	 	
              A.

            	
              Licensor
                is the first and sole inventor of a certain chemical additive for
                use in
                making bio-fuel for internal combustion engines, including all related
                formulas, technical specifications, know-how and other related proprietary
                information (collectively, the “Product”) and is the exclusive owner of
                all intellectual property other proprietary rights with respect to
                same.

            

    

     

    
      	 	
              B.

            	
              Licensee
                desires to obtain an exclusive license from Licensor to make, use
                and sell
                the Product in the Territory comprising North America, Central America
                and
                Caribbean nations as further specified in Schedule
                A
                attached hereto as well as other regions that may be added by mutual
                agreement of the parties (collectively, the “Territory”), and Licensor
                desires to grant such license to Licensee on the terms and conditions
                set
                forth herein.

            

    

     

    NOW,
      THEREFORE, in consideration for the mutual covenants and promises contained
      in
      this Agreement and other good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, the parties agree as
      follows:

     

    1. GRANT
      OF EXCLUSIVE RIGHTS; CONSIDERATION.

     

    
      	 	
              a.

            	
              Exclusive
                License.
                Subject to the other terms and conditions set forth in this Agreement,
                Licensor hereby grants to Licensee the exclusive right and license
                to
                make, cause to be made, use, distribute, sell, offer related services,
                sublicense others to do the same and otherwise to commercialize and
                exploit the Product, as well as any and all modifications, enhancements,
                variations, improvements and related technology developed by or for
                Licensor in the future, including under the claims of any patents
                owned by
                Licensor now or in the future in and throughout the Territory. Licensor
                shall not himself or through third parties (other than Licensee)
                exercise
                any such rights within the Territory while this Agreement is in effect.
                In
                furtherance of same, Licensee shall have the right to engage
                subcontractors to manufacture and/or distribute part or all of the
                Product
                and, as between Licensor and Licensee, Licensee shall be responsible
                for
                all production, storage, distribution, order processing and fulfillment,
                billing and collection activities with respect to sales of the Product
                in
                the Territory.

            

    

     

    
      	 	
              b.

            	
              Consideration.
                In consideration of the rights granted to Licensee in Section 1.a.
                above,
                Licensee agrees to pay to Licensor, while this Agreement is in effect
                and
                provided that Licensor performs its obligations hereunder, the following
                consideration:

            

    

     

    (i) Eleven
      Million Dollars ($11,000,000) payable as follows:

     

    A. One
      and
      One-Half Million Dollars ($1,500,000) due and payable within three (3) business
      days after execution and delivery of this Agreement;

     

    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    B. One
      Million Dollars ($1,000,000) due and payable no later than one hundred eighty
      (180) days after the Effective Date (as defined in Section 6 (a) below);

     

    C. One
      and
      One-Half Million Dollars ($1,500,000) due and payable no later than three
      hundred sixty-five (365) days after the Effective Date; 

     

    D. One
      Million Dollars ($1,000,000) on each subsequent anniversary of the Effective
      Date for the seven (7) years thereafter; and

     

    (ii) a
      twelve
      and one-half percent (12.5%) equity ownership interest in Licensee, to be issued
      to Licensor within sixty (60) days after the Effective Date/other], provided
      that Licensor executes and delivers to Licensee an investor representations
      letter in a form to be provided by Licensee including customary investor
      representations together with a written joinder to Licensor’s stockholders
      agreement agreeing to be bound by the terms thereof.

     

    
      	 	
              c.

            	
              Option
                to Acquire Exclusive Rights in South America; Requirements Regarding
                Paraguay Licensee.
                Licensee is hereby granted the exclusive option to acquire the exclusive
                right and license to make, cause to be made, use, distribute, sell,
                offer
                related services, sublicense others to do the same and otherwise
                to
                commercialize and exploit the Product in and throughout South America,
                excluding Paraguay, said option being exercisable by Licensee within
                the
                first six (6) months after the Effective Date by providing written
                notice
                thereof to Licensor, in exchange for payment of an additional Ten
                Million
                Dollars ($10,000,000) as follows:

            

    

     

    (i) One
      and
      One-Half Million Dollars ($1,500,000) due and payable upon exercise of said
      option;

     

    (ii) One
      and
      One-Half Million Dollars ($1,500,000) due and payable no later than one hundred
      eighty (180) days after exercise of said option; and

     

    (iii) One
      Million Dollars ($1,000,000) due and payable on or before each subsequent
      anniversary of the exercise date of said option for the seven (7) years
      thereafter.

     

    
      	 	 	
              Licensor
                shall require its licensee in Paraguay to sell the Product and/or
                any
                components thereof at prices not lower than the lowest prices offered
                by
                Licensee for same in any part of the
                Territory.

            

    

     

    
      	 	
              d.

            	
              Other
                Expansion of the Territory.
                The Territory may be further expanded by mutual agreement of the
                parties,
                and should Licensor desire to grant any rights to third parties in
                the
                future with respect to the Product not already granted to Licensee
                (excluding Italy), Licensor shall provide written notice via fax
                thereof
                to Licensee and offer same to Licensee first before offering to others.
                In
                the event that the parties are unable to agree in principle with
                respect
                to the material terms of such proposed grant of additional rights
                within
                thirty (30) days after Licensee’s receipt of such notice from Licensor,
                Licensor may then offer such rights to third parties, provided that
                the
                terms offered by Licensor are the same as those that were offered
                to
                Licensee.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
      	 	
              e.

            	
              Technical
                Information Regarding the Product.
                Within twenty (20) days after the Effective Date of this Agreement,
                Licensor shall disclose to Licensee any and all technical information
                and
                know-how then within the knowledge or possession of Licensor which
                was not
                already disclosed to Licensee and which would be helpful to Licensee
                in
                the manufacture, use or sale of the Product. Licensor further agrees
                to
                provide continued disclosure of same to Licensee with respect to
                any
                future developments, modifications, enhancements, new products and
                related
                technology developed or otherwise acquired by Licensor while this
                Agreement is in effect. The disclosure shall take place either at
                Licensee’s offices or telephonically, or as otherwise agreed to by the
                parties. Licensor shall, while this Agreement is in effect, cause
                its
                employees and any third parties who are employed or engaged to do
                research, development or other inventive work relating to the Product
                to
                disclose all inventions, discoveries, know-how and other work product
                resulting therefrom to Licensor and to assign to Licensor all rights
                with
                respect to same to Licensor such that Licensee shall receive, by
                virtue of
                this Agreement, the exclusive license with respect thereto throughout
                the
                Territory as agreed hereunder.

            

    

     

    2. LICENSEE
      UNDERTAKINGS; PRODUCT TESTING.

     

    a. Patent
      Notices.
      Licensee agrees to mark, as appropriate, the following with appropriate patent
      pending notices and/or patent numbers, as applicable, in conformity with
      applicable law: 

     

    (i) all
      packaging or dispensers for the Product made or sold by or for Licensee;
      and

     

    (ii) all
      brochures, manuals, and documents describing the Product.

     

    b. Export
      Control.
      Licensee shall not export or allow the export or re-export of the Product
      without compliance with applicable export laws and regulations of the U.S.
      Department of Commerce and all other U.S. agencies and authorities, including
      without limitation, the Export Administration Regulations of the U.S. Department
      of Commerce Bureau of Export Administration (as contained in 15 C.F.R. Parts
      730-772), and, if applicable, relevant foreign laws and
      regulations.

     

    
      	 	
              c.

            	
              Regulatory
                Compliance.
                Licensee acknowledges that certain regulatory licenses and approvals
                may
                be required to be obtained with respect to the Product from appropriate
                government authorities in the Territory from time to time during
                the term
                of the Agreement. Licensee will obtain and maintain all such licenses
                and
                approvals at its own expense. Licensor will make available to Licensee
                information and assistance as requested by Licensee and/or necessary
                to
                complete all applications and requests for
                approval.

            

    

     

    
      	 	
              d.

            	
              Registration
                Statement for Licensee Securities.
                Licensee shall undertake commercially reasonable efforts to cause
                a
                registration statement to be filed with the Securities and Exchange
                Commission with respect to Licensee’s securities within one hundred eighty
                (180) days after the Effective Date.

            

    

     

    
      	 	
              e.

            	
              Product
                Testing.
                Licensee shall have the right, at its expense, to cause to be performed
                tests to evaluate and measure the performance and commercial viability
                of
                the Product for use as a fuel additive or component including, emission
                tests, tests relating to fuel consumption, engine performance,
                calorimetric energy yield, stability sight and
                formula

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
       

      
        	 	
                 

              	analysis. Licensee may engage third parties in
                connection
                with such testing and shall have the right to disclose the Product
                to such
                third parties for such purposes. Andrea Festuccia shall be part of
                Licensor’s scientific committee to assist Licensee in the management of
                such testing and improvement of the technology in the
                Territory.

      

    

             

    3. REPRESENTATIONS,
      WARRANTIES AND COVENANTS OF LICENSOR.

     

    
      	 	
              a.

            	
              Representations
                and Warranties.
                Licensor represents and warrants to Licensee and its affiliates
                that:

            

    

     

    (i) Licensor
      is the sole owner of all rights, title and interest, including all intellectual
      property rights in and to the Product, free and clear of liens, claims or other
      encumbrances of any kind, other than previously granted licenses outside the
      Territory; 

     

    (ii) Licensor’s
      execution and delivery of this Agreement does not require any third party
      consent or approval that has not already been obtained;

     

    (iii) Licensor
      has sufficient rights to grant the rights granted hereunder to
      Licensee;

     

    (iv) Licensor
      has the legal power and authority to grant the rights and licenses to Licensee
      as set forth in this Agreement;

     

    (v) this
      Agreement and all other agreements to be executed by Licensor in connection
      herewith constitute the valid and binding obligations of Licensor, enforceable
      against Licensor in accordance with their respective terms;

     

    (vi) the
      Product does not infringe or otherwise violate any third party intellectual
      property or other right, no third party license is required in order for
      Licensee to exercise the rights granted to it hereunder throughout the
      Territory, and no suit, action, or claim has been instituted or threatened
      by
      any third party involving the Product or any of the rights licensed hereunder
      or
      infringement of any third party intellectual property or other right;

     

    (vii) Licensor
      is the first and sole inventor of the Product and that the Product is patentable
      throughout the Territory; 

     

    (viii) the
      Product will meet all stability sight and other performance test standards
      undertaken with respect to same; 

     

    (ix) the
      Product can be mass produced without loss of performance qualities;

     

    (x) bio-fuel
      that is merchantable and commercially fit for usage in internal combustion
      engines and provides equal performance as compared to normal diesel fuel can
      be
      made in accordance with the following formulas: for multi-jet new generation
      diesel engines: [CONFIDENTIAL PORTION OMITTED AND FILED SEPARATELY WITH THE
      SECURITIES AND EXCHANGE COMMISSION]; and for traditional diesel engines:
      [CONFIDENTIAL PORTION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
      EXCHANGE COMMISSION]; 

     

    (xi) the
      Product can be used for fuels for automobiles and other internal combustion
      engine-powered devices without requiring modification of such devices
      (excluding

     

    
      
         

        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    possible
      change
      of
      fuel filter). The Licensor has verified that the Product has not caused any
      damage to such devices installed on two cars (one with a traditional diesel
      engine, and the other with a JTD (MUTI-JET)) engine over a distance of 140,000
      km;
      and

     

    (xii) Licensor
      has not made and will not make any commitments to others inconsistent with
      or in
      derogation of Licensee’s rights.

     

    (xiii) Licensor
      does not make any representations or warranties with regard to any tests other
      than those referred to in Section 2(e) above, except as may be otherwise agreed
      by the parties;

     

    
      	 	
              b.

            	
              Maintenance
                of Exclusivity.
                Licensor represents and warrants to Licensee that it has not, and
                covenants to Licensee that during the term of this Agreement, it
                will not,
                grant any other license for sale, use or manufacturing of the Product
                within the Territory or elsewhere other than in compliance with this
                Agreement.

            

    

     

    
      	 	
              c.

            	
              Provision
                of Information for Regulatory Approvals.
                Licensor shall provide to Licensee all pertinent and necessary information
                in order for Licensee to apply for and obtain any required safety
                or other
                regulatory approvals to commercially market and sell the
                Product.

            

    

     

    
      	 	
              d.

            	
              Maintenance
                of Intellectual Property Rights.
                Licensor shall permit and cooperate with Licensee to maintain all
                patent
                and other intellectual property rights in and to the Product and
                Licensor
                will not abandon or permit the expiration of any such patent before
                its
                full term has elapsed, unless so directed by a court of law. 

            

    

     

    
      	 	
              e.

            	
              Scientific
                Committee.
                Given his technical competence and his personal capabilities, Andrea
                Festuccia, a chemical engineer, will direct, with complete autonomy
                and
                with all powers necessary, the Licensor’s Scientific Committee. The
                purpose of the Scientific Committee is to manage, coordinate, and
                oversee
                all the technical inspections and scientific tests for the verification
                and improvement of the Product. Upon Licensee’s advance written
                authorization, Andrea Festuccia will cooperate with Licensee to arrange
                for the development of the testing activities for the Product, cited
                above.  

            

    

     

    
      	 	
              f.

            	
              On
                account of his technical-commercial competence and his personal
                capabilities, Mr. Dante Lucchetti will undertake to direct and coordinate
                on Licensor’s behalf, in full autonomy and with all powers necessary, all
                commercial relations developed in the future outside of the Territory,
                remaining the sole individual responsible on Licensor’s behalf for this
                aspect.

            

    

     

    4. INFRINGEMENT
      BY THIRD PARTIES.

     

    
      	 	
              a.

            	
              Notification
                of Infringements.
                Should Licensor or Licensee become aware of any infringement or alleged
                infringement of any patents covering any portion of the Product,
                misappropriation of trade secrets or any other infringement or violation
                of the intellectual property rights relating to the Product, that
                party
                shall immediately notify the other party in writing of the name and
                address of alleged infringer, the alleged acts of infringement, and
                any
                available evidence of infringement.

            

    

     

    
      	 	
              b.

            	
              Enforcement
                of Rights.
                Licensee shall have primary responsibility for enforcing any patent, trade
                secret or other intellectual property rights relating to the Product,
                whether on

            

    

     

    
      
         

        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
       

      
        	 	
                 

              	behalf of Licensor or as Licensor’s exclusive licensee,
                against any third parties and shall have the right to bring legal
                action
                against such third parties to enforce such rights. If Licensee fails
                to
                take action against any such third parties within one hundred eighty
                (180)
                days of being notified regarding same, Licensor may, at Licensor’s option,
                bring legal action against such third parties in the name of Licensor
                to
                enforce such rights. In the event that any such litigation results
                in a
                damage award favoring the party bringing action to enforce any such
                rights, such a damage award shall be the property of the party that
                pursued such litigation.

      

         
        

    

    5. INDEMNIFICATION.

     

    
      	 	
              a.

            	
              Indemnification
                by Licensor.
                Licensor shall, at its expense, indemnify, defend and hold harmless
                Licensee, its affiliates, sublicensees and subcontractors, and their
                respective employees, officers and agents (each, a “Licensee Indemnified
                Party” and collectively, the “Licensee Indemnified Parties”) from and
                against any and all claims and causes of action of any nature made
                or
                lawsuits or other proceedings filed or otherwise instituted against
                any of
                the Licensee Indemnified Parties arising from or relating to any
                breach by
                Licensor of any of its representations, warranties or obligations
                hereunder. Licensor shall be responsible for and shall pay all costs
                and
                expenses related to such claims and proceedings, including, but not
                limited to, the payment of all attorney’s fees and costs of litigation,
                defense and/or settlement of same. In the event that the Product,
                in part
                or as a whole, infringes or is accused of infringing a third party’s
                intellectual property rights, in addition to the foregoing indemnification
                obligations, Licensor shall either (a) procure for Licensee and its
                sublicensees the right to continue making, using and selling the
                Product,
                (b) provide Licensee and its sublicensees with a functionally equivalent,
                non-infringing replacement for the Product, or (c) refund all fees
                paid by
                Licensee hereunder, and assign back to Licensee the equity interest
                in
                Licensee granted to Licensor pursuant to Section 1.b. (ii)
                above.

            

    

     

    
      	 	
              b.

            	
              Indemnification
                Procedures.
                In claiming any indemnification hereunder, Licensee shall promptly
                provide
                Licensor with written notice of any claim that Licensee believes
                falls
                within the scope of the foregoing paragraph. Licensee may, at its
                own
                expense, assist in the defense if it so chooses, in which case Licensee
                may elect to control such defense and all negotiations relative to
                the
                settlement of any such claim and further provided that any settlement
                intended to bind Licensor shall not be final without Licensor’s written
                consent, which shall not be unreasonably withheld.
                

            

    

     

    
      	 	
              c.

            	
              Set-Off
                Right.
                Licensee shall have the right to deduct and set-off any damages,
                costs or
                expenses (including, without limitation, legal fees and expenses)
                incurred
                by Licensee with respect to any claims for which it is entitled to
                indemnification pursuant to this Agreement against any amounts payable
                to
                Licensor hereunder, and may impose a lien on the equity interest
                in
                Licensee granted to Licensor pursuant to Section 1.b.(ii) as collateral
                for such indemnification
                obligations.

            

    

     

    6. TERM,
      RENEWAL AND TERMINATION.

     

    
      	 	
              a.

            	
              Term.
                The term of this Agreement shall commence on the date that the first
                payment is made (“Effective Date”) and continue in effect in perpetuity
                unless sooner terminated as provided below (the “Term”).
                

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    
      	 	
              b.

            	
              Termination
                by Licensor.
                Licensor shall have the right to terminate this Agreement by providing
                written notice thereof to Licensee describing the basis for such
                termination if any of the following events occur: (i) if Licensee
                materially defaults in performing any of its other obligations under
                this
                Agreement, or (ii) if a proceeding is commenced by or against Licensee
                seeking liquidation, conservatorship or other relief with respect
                to
                Licensee or its assets under any bankruptcy, insolvency or other
                similar
                law, or seeking the appointment of a trustee, receiver or other similar
                official with respect to Licensee and/or a substantial portion of
                its
                assets, and such default is not cured, or such proceeding is not
                dismissed, within ninety (90) days after Licensor has provided written
                notice to Licensee of its intentions to terminate this Agreement
                and
                specifying the reasons for same.

            

    

     

    
      	 	
              c.

            	
              Termination
                by Licensee.
                Licensee shall have the right to terminate this Agreement by providing
                written notice thereof to Licensor if any of the following events
                occur:
                (i) if Licensor materially defaults in performing any of its obligations
                hereunder, or (ii) if Licensor becomes insolvent or if a proceeding
                is
                commenced by or against Licensor seeking liquidation, rehabilitation,
                reorganization, conservatorship or other relief with respect to Licensor
                or its assets under any bankruptcy, insolvency or other similar law,
                or
                seeking the appointment of a trustee, receiver or other similar official
                with respect to Licensor and/or a substantial portion of its assets
                and
                such default is not cured, or such proceeding is not dismissed, within
                ninety (90) days after Licensee has provided written notice to Licensor
                of
                its intentions to terminate this Agreement and specifying the reasons
                for
                same. Additionally, Licensee shall have the right to terminate this
                Agreement at any time for convenience by providing written notice
                thereof
                to Licensor not less than thirty (30) days prior to the effective
                date of
                such termination.

            

    

     

    
      	 	
              d.

            	
              Post-Termination
                Obligations; Phase-out Period.
                Subsequent to the termination of this Agreement for any reason, Licensee
                may, for up to twelve (12) months after the effective date of such
                termination, continue to sell its inventory of the Product. Thereafter
                Licensee shall not engage in the further use, sale, or other
                commercialization of the Product without Licensor’s prior written consent,
                which consent shall not be withheld
                unreasonably.

            

    

     

    
      	 	
              e.

            	
              Effect
                of Termination.
                Nothing herein shall be construed to release either party from any
                obligation which matured prior to the effective date of such termination
                or which may continue beyond such termination, and any unpaid payments
                due
                from Licensee under this Agreement as of the effective date of termination
                shall become immediately due and payable to Licensor. Licensor
                acknowledges and agrees that this Agreement and all rights and licenses
                granted under or pursuant to this Agreement by Licensor to Licensee
                are,
                and shall otherwise be deemed to be licenses of rights to intellectual
                property. Licensor agrees that Licensee, as a licensee of such rights
                under this Agreement, shall retain and may fully exercise all of
                its
                rights and elections under applicable bankruptcy, insolvency or other
                similar law, including specifically but without limitation, Section
                365(n)
                of the U.S. Bankruptcy Code, as amended. Licensor further agrees
                that, in
                the event of the commencement of a voluntary or involuntary proceeding
                against Licensor seeking liquidation, rehabilitation, reorganization,
                conservatorship or other relief with respect to it or its assets
                under any
                bankruptcy, insolvency or other similar law, Licensee, in addition
                to its
                right to terminate this Agreement, shall also have the right, at
                its
                election, to retain all of its rights under this
                Agreement.

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    
      	 	
              f.

            	
              Rights
                of Sublicensees after Termination of License Agreement.
                The termination of this Agreement shall not affect the continued
                effectiveness of any sublicenses previously granted by Licensee with
                respect to the Product pursuant to this Agreement and still in effect
                as
                of the effective date of such termination, provided that the sublicensee
                is in full compliance with the terms of the applicable sublicense
                agreement then in effect with respect to the Product. In the event
                of
                termination of this Agreement for any reason other than by Licensee
                due to
                an uncured breach by Licensor, all agreements with sublicenses with
                respect to the Product entered into by Licensee pursuant to this
                Agreement
                shall thereupon automatically be deemed assigned to Licensor. Licensor
                shall be thereafter be deemed the licensor under same under all such
                agreements. Said substitution shall be effective and self-operative,
                without the execution of any other instrument, and the sublicenses
                shall
                continue in accordance with their terms between the sublicensee and
                Licensor; provided that Licensor shall not be liable for any prior
                act,
                omission or breach of any duty or obligation by Licensee.
                

            

    

     

    7. TAXES,
      GOVERNMENTAL APPROVALS.

     

    
      	 	
              a.

            	
              Taxes.
                Licensee shall be solely responsible for the payment and discharge
                of any
                taxes, duties, or withholdings relating to any transaction of Licensee
                in
                connection with the manufacture, use, sale, licensing or other
                commercialization or exploitation of the Product. Licensor is solely
                responsible for any and all taxes, fees relating to its ownership
                of
                intellectual property rights in and to the Product, including but
                not
                limited to taxes on all amounts paid to Licensor
                hereunder.

            

    

     

    
      	 	
              b.

            	
              Government
                Approvals.
                Licensee shall, at its own expense, be responsible for applying for
                and
                obtaining any regulatory approvals, authorizations, or validations
                relative to the Product and/or manufacture and sale of the Product
                under
                the appropriate national laws or
                otherwise.

            

    

     

    8. INDEPENDENCE
      OF THE PARTIES.

     

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

     

    9. SUBLICENSING
      AND ASSIGNMENT.

     

    
      	 	
              a.

            	
              Sublicensing.
                Licensor authorizes Licensee to grant sublicenses of the rights granted
                to
                it hereunder to its subdistributors, contractors and other third
                parties
                as reasonably necessary for Licensee to perform its obligations hereunder.
                

            

    

     

    
       

      
        	 	
                b.

              	
                Assignment
                  by Licensee.
                  Except as provided for in Section 9.a.
                  above or as otherwise provided for in this Agreement, Licensee
                  shall not
                  have the right to assign or otherwise transfer this Agreement and/or
                  any
                  rights acquired by Licensee hereunder, except to an affiliate or
                  in
                  connection with a sale of all or substantially all of its assets,
                  or in
                  connection with obtaining financing for its business, without the
                  prior
                  written consent of Licensor, which consent shall not be unreasonably
                  withheld. As used herein, “affiliate” means any person or entity directly
                  or indirectly controlling or having the power
                  to

              

      

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      
         

        
          	 	
                   

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

        

      

    

    
      
         

        
          	 	
                  c.

                	Assignment by Licensor; Right of First
                  Refusal.
                  Licensor shall not have the right to assign or otherwise transfer
                  this
                  Agreement, including rights acquired by Licensor under this Agreement
                  to
                  payments, to any third party other than Licensee, without the prior
                  written consent of Licensee, which consent shall not be unreasonably
                  withheld. Such assignment or transfer shall not be deemed effective
                  unless
                  such assignee or transferee has agreed in writing to acknowledge
                  Licensee’s right hereunder and be bound by the terms and provisions of
                  this Agreement. In the event that Licensor shall at any time determine
                  to
                  sell, assign or otherwise transfer all or part of Licensor’s rights with
                  respect to the Product or this Agreement, Licensor shall obtain
                  a bona
                  fide executed written offer from the proposed transferee and shall
                  submit
                  an exact copy of such offer to Licensee. Licensee shall have the
                  right,
                  exercisable by written notice delivered to Licensor within sixty
                  (60) days
                  from the date of delivery of an exact copy of such offer to Licensee,
                  to
                  purchase such rights and interests for the price and on the terms
                  and
                  conditions contained in such offer, provided that Licensee may
                  substitute
                  cash or its or its affiliates’ securities for any form of payment proposed
                  in such offer and shall not have less than ninety (90) days to
                  prepare for
                  closing. If Licensee does not exercise the above-described right
                  of first
                  refusal, Licensor may complete the sale to such purchaser pursuant
                  to and
                  on the terms of such offer, provided that if the sale to such purchaser
                  is
                  not completed within one hundred twenty (120) days after delivery
                  of such
                  offer to Licensee or there is a material change in the terms of
                  the
                  proposed transaction, Licensee shall again have the right of first
                  refusal
                  herein provided. 

        

         

      

    

    10. NOTICES.

     

    Any
      notice or communication permitted or required under this Agreement shall be
      in
      writing and shall be delivered in person or by courier, or mailed by certified
      or registered mail, postage prepaid, return receipt requested, and addressed
      as
      set forth for the intended recipient in the first paragraph of this Agreement,
      to the attention of the President of Licensee in the case of notices delivered
      by Licensor to Licensee, or to such other address as shall be given in
      accordance with this Section. If notice is given in person or by courier, it
      shall be effective upon receipt; and if notice is given by mail, it shall be
      effective five (5) business days after deposit in the mail.

     

    11. ARBITRATION;
      GOVERNING LAW.

     

    
      	 	
              a.

            	
              Arbitration.
                Any dispute, controversy or claim arising out of or relating to this
                Agreement or the interpretation, breach, termination or validity
                thereof,
                other than those for which injunctive relief is appropriate, shall
                be
                finally settled in accordance with the Commercial Arbitration Rules
                of the
                American Arbitration Association (the “AAA”) then obtaining, by a panel of
                three (3) arbitrators. Each party shall have the right to appoint
                one (1)
                arbitrator from the list of arbitrators supplied to the parties by
                the
                AAA, and the two (2) arbitrators so appointed shall appoint the third.
                The
                parties may agree to a single arbitrator in lieu of a panel of three
                arbitrators.

            

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
       

      
        	 	
                 

              	The place of arbitration shall be Miami, Florida,
                U.S.A.
                and each party hereto irrevocably consents and submits to the exclusive
                jurisdiction of such arbitration panel in such venue. The language
                of the
                arbitration shall be in English. The arbitrators shall determine
                the
                matters in dispute in accordance with the internal laws of the State
                of
                Florida without reference to the Convention on Contracts for the
                International Sale of Goods. The parties agree that the award of
                the
                arbitrators shall be the sole and exclusive remedy between them regarding
                any claims, counterclaims, issues or accountings presented or pled
                to the
                arbitrators, that the award shall be made and shall be promptly payable
                in
                U.S. dollars, free of any tax, deduction or offset, and that any
                costs,
                fees or taxes instant to enforcing the award shall, to the maximum
                extent
                permitted by law, be charged against the party resisting such enforcement.
                The award shall include interest from the date of damages incurred
                for
                breach or other violation of this Agreement, and from the date of
                the
                award until paid in full, at a rate to be fixed by the arbitrators.
                

      

    

     

    
      	 	
              b.

            	
              Governing
                Law.
                This Agreement shall for all purposes be governed by and interpreted
                in
                accordance with the laws of the State of Florida without reference
                to its
                choice of law principles. 

            

    

     

    12. ATTORNEY’S
      FEES.

     

    In
      the
      event that there is a default under this Agreement and it becomes reasonably
      necessary for any party to employ the services of any attorney, either to
      enforce or terminate this Agreement, with or without arbitration, the
      non-defaulting party shall be entitled to collect from the defaulting party
      its
      reasonable attorneys fees and such other costs and expenses as are incurred
      by
      it in enforcing or terminating this Agreement.

     

    13. 
      INTELLECTUAL PROPERTY PROTECTION; IMPROVEMENTS AND NEW
      PRODUCTS.

     

    
      	 	
              a.

            	
              Intellectual
                Property Protection.
                Licensee shall undertake commercially reasonable efforts to seek
                and
                obtain patent protection for the Product in the countries comprising
                the
                Territory on behalf of Licensor and Licensee shall bear the expenses
                associated therewith. Licensee shall also be responsible at Licensee’s
                expense for maintaining in force for the available patent term any
                patents
                that are granted as a result thereof while this Agreement is in effect.
                Licensor shall provide all necessary and/or requested cooperation,
                documentation and assistance, including, without limitation, execution
                and
                delivery of oaths, declarations, powers of attorney, affidavits,
                testimony
                and any other documents or instruments that may be required or requested
                by Licensee in connection therewith, as well as in connection with
                Licensee’s enforcement of such rights against third
                parties.

            

    

     

    
       

      
        	 	
                b.

              	Improvements to the Product; New Inventions.
                In the event that Licensee, through its employees or independent
                contractors, invents or causes to be invented any improvements,
                refinements or modifications to the Product or new products related
                to the
                Product, Licensee shall own all intellectual property and other rights
                with respect thereto without a duty to account or any other duty
                to
                Licensor with respect to same, and shall be entitled to commercialize
                and
                exploit same as Licensee determines in its sole and absolute discretion
                only in the Territory. Licensee shall communicate any improvements,
                refinements or modifications to the Product or new products related
                to the
                Product (referred to as “Product Improvements”), and Licensor shall be
                entitled to commercialize and exploit such Product Improvements in
                all the
                other countries except the Territory, as may be expanded from time
                to
                time, subject to the terms

      

       

       

    

    
      
        
           

          
          

        

        
          10

          
            

          

        

        
          
          

        

      

    
      
         

        
          	 	
                   

                	and conditions herein; and subject to a cross-licensing
                  arrangement to be agreed between Licensor to Licensee that will
                  contain,
                  among other terms and conditions, provisions for a cross-licensing
                  royalty
                  payable by Licensor.

        

      

    

    a     
      nd    

    14. GENERAL
      PROVISIONS.

     

    
      	 	
              a.

            	
              Entire
                Agreement.
                The parties hereto have read this Agreement and agree to be bound
                by all
                its terms. The parties further agree that this Agreement, together
                with
                the stockholders agreement referred to in Section 1.b.(ii) above,
                shall
                constitute the full, complete and exclusive statement of the Agreement
                between them and supersedes all agreements, proposals, oral or written,
                and all other communications between them relating to the subject
                matter
                of this Agreement.

            

    

     

    
      	 	
              b.

            	
              Modifications.
                No agreement changing, modifying, amending, extending, superseding,
                discharging, or terminating this Agreement or any provisions hereof
                shall
                be valid unless it is in writing and is dated and signed by duly
                authorized representatives of the party against which enforcement
                is
                sought.

            

    

     

    
      	 	
              c.

            	
              Severability.
                Should any term or provision of this Agreement be finally determined
                by an
                arbitration panel to be void, invalid, unenforceable or contrary
                to law or
                equity, the offending term or provision shall be modified and limited
                (or
                if strictly necessary, deleted) only to the extent required to conform
                to
                the requirements of law and the remainder of this Agreement (or,
                as the
                case may be, the application of such provisions to other circumstances)
                shall not be affected thereby but rather shall be enforced to the
                greatest
                extent permitted by law.

            

    

     

    
      	 	
              d.

            	
              Waiver.
                Failure of any of the parties hereto to enforce any of the provisions
                of
                this Agreement or any rights with respect thereto or to exercise
                any
                election provided for therein, shall in no way be considered a waiver
                of
                such provisions, rights, or election or in any way to affect the
                validity
                of this Agreement. No term or provision hereof shall be deemed waived
                and
                no breach excused, unless such waiver or consent shall be in writing
                and
                signed by the party claimed to have waived or consented. Any consent
                by
                any party to, or waiver of, a breach by the other, whether express
                or
                implied, shall not constitute a consent or waiver of, or excuse for
                any
                other, different or subsequent breach. All remedies herein conferred
                upon
                any party shall be cumulative and no one shall be exclusive of any
                other
                remedy conferred herein by law or
                equity.

            

    

     

    
      	 	
              e.

            	
              Currency;
                Days; Time of the Essence.
                All monetary amounts referred to herein are in U.S. Dollars and all
                references to days mean calendar days. Time is of the essence in
                the
                performance of each and every obligation and covenant imposed by
                this
                Agreement.

            

    

     

    
      	 	
              f.

            	
              Binding
                Agreement.
                This Agreement shall be binding not only upon the parties hereto,
                but also
                upon their respective successors, permitted assignees and in the
                case of
                Licensor, his heirs.

            

    

     

    
      	 	
              g.

            	
               Force
                Majeure.
                Neither Party shall be liable to the other party on account of any
                loss,
                damage, or delay occasioned or caused by strikes, riots, fires and
                floods,
                insurrection, terrorist attacks, war, the elements, embargoes, failure
                of
                carriers, inability to obtain material or transportation facilities,
                acts
                of God or of the public enemy, compliance with any law, regulation
                or
                other governmental order, or any other causes beyond the control
                of either
                party whether or not similar to the foregoing (“Force Majeure” or
                “Force

            

    

     

    
      
         

        
        

      

      
        11

        
          

        

      

      
        
        

      

    

             
Majeure
      Event”). Every reasonable effort shall be made by the party claiming Force
      Majeure to avoid delay or suspension of performance hereunder, but neither
      party
      shall be required to do so in any manner in which such party does not deem
      to be
      in its best interest in order to be able to perform its obligations hereunder.
      As soon as practicable after occurrence of any Force Majeure Event, the party
      claiming Force Majeure shall notify the other party in writing of such Force
      Majeure Event and, to the extent possible, inform the other party of the
      expected duration of the Force Majeure Event and the performance to be affected
      by the suspension or curtailment under this Agreement. After the termination
      of
      any Force Majeure Event, as soon as practicable, the party claiming Force
      Majeure shall notify the other party in writing of the termination of such
      Force
      Majeure Event and of the anticipated timing of the resumption of performance.
      

     

    
      	 	
              h.

            	
              Expenses.
                Except as provided elsewhere in this Agreement, all of the legal,
                accounting, and other miscellaneous expenses incurred in connection
                with
                this Agreement and the performance of the various provisions of this
                Agreement shall be paid by the party who incurred the expense. Licensee
                acknowledges and agrees that it shall be responsible for all costs
                and
                expenses for preparing and filing a PCT patent application for the
                Product
                in all the countries that agree to the PCT (Patent Cooperation Treaty)
                in
                the name of the Licensor, to be executed by a patent lawyer appointed
                by
                Licensee . Those costs are in addition to any payments to be made
                hereunder by the Licensee..

            

    

     

    
      	 	
              i.

            	
              Survival.
                All covenants, agreements, representations, warranties, indemnities
                and
                provisions of this Agreement which by their nature are intended survive
                the termination of this Agreement (including, without limitation,
                Sections
                3, 5, 6.d.-f., 7.a., 8-12, and 14) shall so survive after the effective
                date of termination of this
                Agreement.

            

    

     

    
      	 	
              j.

            	
              Disclaimer
                of Warranties; Limitation of Liability.
                EXCEPT FOR THE WARRANTIES EXPRESSLY PROVIDED HEREIN, NEITHER PARTY
                HERETO
                MAKES ANY WARRANTIES AND DISCLAIMS ANY IMPLIED WARRANTIES OF ANY
                KIND,
                INCLUDING, BUT NOT LIMITED TO, ANY IMPLIED WARRANTIES OF MERCHANTABILITY,
                FITNESS FOR A PARTICULAR PURPOSE OR AGAINST INFRINGEMENT WITH REGARD
                TO
                THE PRODUCT OR THE PERFORMANCE OF ITS OBLIGATIONS HEREUNDER. EXCEPT
                FOR
                CLAIMS INVOLVING FRAUD OR OTHER WILLFUL MISCONDUCT OR NEGLIGENCE,
                NEITHER
                PARTY SHALL BE LIABLE TO THE OTHER PARTY WITH RESPECT TO ANY PUNITIVE,
                SPECIAL, CONSEQUENTIAL, INCIDENTAL OR INDIRECT DAMAGES, INCLUDING
                WITHOUT
                LIMITATION, LOST PROFITS ARISING OUT OF THE PERFORMANCE OF NONPERFORMANCE
                OF THIS AGREEMENT, EVEN IF THE PARTY HAS BEEN ADVISED OF THE POSSIBILITY
                OF SUCH DAMAGES. 

            

    

     

    
       

      
        	 	
                k.

              	Confidentiality.
                Each party acknowledges that it has in the past and may in the future
                receive Confidential Information belonging to, and disclosed to it,
                by the
                other party and/or its authorized representatives, and that all of
                the
                other party’s Confidential Information is material and confidential and
                greatly affects the goodwill and the effective and successful conduct
                of
                such party and its business and operations, and that maintaining
                confidentiality of such party’s Confidential Information is reasonably
                necessary to protect the legitimate business interests of such party.
                Accordingly, each party hereby agrees to receive all such Confidential
                Information provided by the other party in strict confidence and
                that
                neither it nor any of its officers, directors, representatives, employees
                or agents (including any consultants, subcontractors
                or

      

    

    
      
         

        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      
         

        
          	 	
                   

                	advisors) shall, at any time while this Agreement
                  is in
                  effect or thereafter, directly or indirectly, divulge, reveal or
                  communicate any such Confidential Information to any person, firm,
                  corporation or entity whatsoever, or use, pursue or exploit any
                  such
                  Confidential Information for its own benefit or for the benefit
                  of others.
                  Each party agrees not to infringe any of the other party’s intellectual
                  property or other rights in its Confidential Information, and nothing
                  herein shall be construed as expressly or impliedly granting a
                  license or
                  right to use such Confidential Information by the other party except
                  with
                  respect to the rights granted to Licensee with respect to the Product
                  and
                  as otherwise expressly provided herein and/or as reasonably necessary
                  for
                  Licensee to engage and utilize subcontractors for testing, manufacturing,
                  distribution, sale and other commercialization of the Product as
                  contemplated hereunder. Each party shall disclose to and enforce
                  the
                  confidentiality provisions of this Agreement in writing with respect
                  to
                  all of its officers, directors, representatives, employees or agents
                  (including any consultants, subcontractors or advisors), as applicable.
                  The foregoing restrictions shall not apply to Licensee to the extent
                  that
                  such information comprises the Product or related technology after
                  a
                  patent application has been filed for the Product, or to the extent
                  that,
                  with respect to either party, such
                  information:

        

         

      

    

    (i) is
      or
      becomes public knowledge (other than by breach of that
      restriction);

     

    (ii) was
      obtained by the recipient party from a third party having the right to disclose
      it, without the obligation to keep such information confidential;

     

    (iii) was
      independently developed by the recipient party without the use of such
      Confidential Information and without the participation of individuals who have
      had access to such Confidential Information; or

     

    (iv) is
      required to be provided by law, legal process (including subpoena, civil
      investigative demand or similar process) or any regulatory authority; provided,
      that the recipient party shall promptly notify the disclosing party in writing
      so the disclosing party may seek a protective order and/or other motion to
      prevent the production of such Information.

     

    For
      purposes of this Agreement, “Confidential
      Information”
means
      information relating to a party hereto and its assets, operations, clients,
      and
      past, present, and future businesses, including but not limited to know-how,
      drawings, manuals, reports, formulae, algorithms, processes, trade secrets,
      computer software, computer data bases, computer software documentation,
      research products, inventions, technical data, specifications, designs, ideas,
      product plans, research and development efforts, personal and customer
      information, financial information, quotations, price lists, customer lists,
      business methods and operations and marketing programs, all of which are
      proprietary with such party and involve trade secrets, know-how, techniques,
      and
      combinations of known information of a character regarded by such party as
      confidential, except as otherwise provided above with respect to the
      Product.

     

    
      	 	
              l.

            	
              Further
                Assurances.
                Each party agrees to execute and deliver such other and further documents
                and instruments as may be necessary to effectuate the intent and
                purposes
                of this Agreement upon request by the other
                party.

            

    

     

    
      	 	
              m.

            	
              Construction;
                Counterparts.
                The headings used in this Agreement are for reference purposes only
                and
                shall not be considered a part of this Agreement. This Agreement
                may

            

    

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

     

    
       

      
        	 	
                 

              	be executed in counterparts, each of which shall
                be
                deemed to be an original and all of which shall constitute one and
                the
                same agreement. For the convenience of the Licensor, a copy of this
                Agreement is being translated into Italian for convenience of the
                parties.
                In the event of a conflict between this English version and the Italian
                version, this English version shall govern and prevail.
                

      

       

    

    IN
      WITNESS WHEREOF,
      the
      parties hereto have executed or caused this Agreement to be executed as of
      the
      Effective Date.

     

    

     

    
      	
              LICENSOR:

              FERDINANDO
                PETRUCCI

               

            	 	
              LICENSEE:

              H2Diesel,
                Inc., a Delaware corporation

            
	
              /s/
                Ferdinando Petrucci

            	 	
              /s/
                Lee S. Rosen

            
	
              Signature

            	 	
              Signature

            
	 	 	 
	 	 	
              Name:
                Lee S. Rosen

            
	 	 	 
	 	 	
              Title:
                President

            

    

    

    
      
         

        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    SCHEDULE
      A

    

    Territory

     

    
 

    
      	
              A.

            	
              North
                America:
                United States of America, its possessions and territories (including
                without limitation Puerto Rico), Canada and
                Mexico.

            

    

     

    
      
        	
                B.

              	Central America:
                Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua,
                Panama.

      

       

    

    
      	
              C.

            	
              Caribbean:
                Antigua & Barbuda, Aruba, Bahamas, Cayman Islands, Cuba (currently
                subject to U.S. embargo), Dominica, Dominican Republic, Grenada,
                Guadeloupe, Haiti, Jamaica, Martinique, St. Kitts & Nevis, St. Lucia,
                St. Vincent and the Grenadines, Trinidad & Tobago, Turks & Caicos
                Islands, and Virgin Islands.

            

    

    

    Option
      Territory

    

    
      	 	
              South
                America, excluding Paraguay:
                Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, French Guiana,
                Guyana, Peru, Suriname, Uruguay and
                Venezuela.

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