Amendment No. 1 to Bridge Loan Agreement

Reference is made to that certain Bridge Loan Agreement (the “ Agreement ” ) effective as of March 1, 2010 by and among ThermoEnergy Corporation, a Delaware corporation having its principal place of business in Little Rock, Arkansas (the “Borrower”) and the individual and entities named on Schedule I hereto  (collectively, the “Lenders”).

WHEREAS, pursuant to the Agreement, the Lenders agreed to make loans to the Borrower in the aggregate principal amount of $2,700,000 (the “Original Loans”); and

WHEREAS, Section 4.1 of the Agreement provides, in pertinent part, that from time to time on or before the “Third Tranche Closing Date” (as such term is defined in the Agreement), the Agreement may be amended by the Borrower, with the consent of Lenders holding at least 66⅔% of the principal amount of the then outstanding Notes (as such term is defined in the Agreement), to permit any Lender to increase the amount of his or its Commitment (as such term is defined in the Agreement); provided, however, that the aggregate amount of such additional Commitments may not exceed $2,000,000; and

WHEREAS, the Third Tranche Closing Date has not yet occurred; and

WHEREAS, the Borrower desires to borrow from certain of the Lenders, and such Lenders are willing to lend to the Borrower, an additional $2,000,000 (the “New Loans”) on substantially the same terms and conditions as governed the Original Loans;

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants