PROPOSED FORM OF
STOCK OPTION PLAN

1. GRANT OF OPTIONS; GENERALLY. In accordance with the provisions hereinafter set forth in this stock option plan, the name of which is the T/F PURIFINER, INC. 1996 STOCK OPTION PLAN (the "Plan"), the Board of Directors (the "Board") or, the Compensation Committee (the "Stock Option Committee") of T/F Purifiner, Inc. (the "Corporation") is hereby authorized to issue from time to time on the Corporation's behalf to any one or more Eligible Persons, as hereinafter defined, options to acquire shares of the Corporation's $.001 par value common stock (the "Stock").

2. TYPE OF OPTIONS. The Board or the Stock Option Committee is authorized to issue options which meet the requirements of Section ss.422 of the Internal Revenue Code of 1986, as amended (the "Code"), which options are hereinafter referred to collectively as ISOs, or singularly as an ISO. The Board or the Stock Option Committee is also, in its discretion, authorized to issue options which are not ISOs, which options are hereinafter referred to collectively as NSOs, or singularly as an NSO. The Board or the Stock Option Committee is also authorized to issue "Reload Options" in accordance with Paragraph 8 herein, which options are hereinafter referred to collectively as Reload Options, or singularly as a Reload Option. Except where the context indicates to the contrary, the term "Option" or "Options" means ISOs, NSOs and Reload Options.

3. AMOUNT OF STOCK. The aggregate number of shares of Stock which may be purchased pursuant to the exercise of Options shall be 650,000 shares. Of this amount, the Board or the Stock Option Committee shall have the power and authority to designate whether any Options so issued shall be ISOs or NSOs, subject to the restrictions on ISOs contained elsewhere herein. If an Option ceases to be exercisable, in whole or in part, the shares of Stock underlying such Option shall continue to be available under this Plan. Further, if shares of Stock are delivered to the Corporation as payment for shares of Stock purchased by the exercise of an Option granted under this Plan, such shares of Stock shall also be available under this Plan. If there is any change in the number of shares of Stock on account of the declaration of stock dividends, recapitalization resulting in stock split-ups, or combinations or exchanges of shares of Stock, or otherwise, the number of shares of Stock available for purchase upon the exercise of Options, the shares of Stock subject to any Option and the exercise price of any outstanding Option shall be appropriately adjusted by the Board or the Stock Option Committee. The Board or the Stock Option Committee shall give notice of any adjustments to each Eligible Person granted an Option under this Plan, and such adjustments shall be effective and binding on all Eligible Persons. If because of one or more recapitalizations, reorganizations or other corporate events, the holders of outstanding Stock receive something other than shares of Stock then, upon exercise of an Option, the Eligible Person will receive what the holder would have owned if the holder had exercised the Option immediately before the first such corporate event and not disposed of anything the holder received as a result of the corporate event.

4. ELIGIBLE PERSONS.

(a) With respect to ISOs, an Eligible Person means any individual who has been employed by the Corporation or by any subsidiary of the Corporation, for a continuous period of at least sixty (60) days.

(b) With respect to NSOs, an Eligible Person means (i) any individual who has been employed by the Corporation or by any subsidiary of the Corporation, for a continuous period of at least sixty (60) days, (ii) any director of the Corporation or any subsidiary of the Corporation, (iii) any member of the Corporation's advisory board member or of any of the Corporation's subsidiar(ies), or (iv) any consultant of the Corporation or by any subsidiary of the Corporation.

5. GRANT OF OPTIONS. The Board or the Stock Option Committee has the right to issue the Options established by this Plan to Eligible Persons. The Board or the Stock Option Committee shall follow the procedures prescribed for it elsewhere in this Plan. A grant of Options shall be set forth in a writing signed on behalf of the Corporation or by a majority of the members of the Stock Option Committee. The writing shall identify whether the Option being granted is an ISO or an NSO and shall set forth the terms which govern the Option. The terms shall be determined by the Board or the Stock Option Committee, and may include, among other terms, the number of shares of Stock that may be acquired pursuant to the exercise of the Options, when the Options may be exercised, the period for which the Option is granted and including the expiration date, the effect on the Options if the Eligible Person terminates employment and whether the Eligible Person may deliver shares of Stock to pay for the shares of Stock to be purchased by the exercise of the Option. However, no term shall be set forth in the writing which is inconsistent with any of the terms of this Plan. The terms of an Option granted to an Eligible Person may differ from the terms of an Option granted to another Eligible Person, and may differ from the terms of an earlier Option granted to the same Eligible Person.

6. OPTION PRICE. The option price per share shall be determined by the Board or the Stock Option Committee at the time any Option is granted, and shall be not less than (i) in the case of an ISO, the fair market value, (ii) in the case of an ISO granted to a ten percent or greater stockholder, 110% of the fair market value, or (iii) in the case of an NSO, not less than 75% of the fair market value (but in no event less than the par value) of one share of Stock on the date the Option is granted, as determined by the Board or the Stock Option Committee. Fair market value as used herein shall be:

(a) If shares of Stock shall be traded on an exchange or over-the-counter market, the closing price or the closing bid price of such Stock on such exchange or over-the-counter market on which such shares shall be traded on that date, or if such exchange or over-the-counter market is closed or if no shares shall have traded on such date, on the last preceding date on which such shares shall have traded.

(b) If shares of Stock shall not be traded on an exchange or over-the-counter market, the value as determined by the Board of Directors or the Stock Option Committee of the Corporation.

7. PURCHASE OF SHARES. An Option shall be exercised by the tender to the Corporation of the full purchase price of the Stock with respect to which the Option is exercised and written notice of the exercise. The purchase price of the Stock shall be in United States dollars, payable in cash or by check, or in property or Corporation stock, if so permitted by the Board or the Stock Option Committee in accordance with the discretion granted in Paragraph 5 hereof, having a value equal to such purchase price. The Corporation shall not be required to issue or deliver any certificates for shares of Stock purchased upon the exercise of an Option prior to (i) if requested by the Corporation, the filing with the Corporation by the Eligible Person of a representation in writing that it is the Eligible Person's then present intention to acquire the Stock being purchased for investment and not for resale, and/or (ii) the completion of any registration or other qualification of such shares under any government regulatory body, which the Corporation shall determine to be necessary or advisable.

8. GRANT OF RELOAD OPTIONS. In granting an Option under this Plan, the Board or the Stock Option Committee may include a Reload Option provision therein, subject to the provisions set forth in Paragraphs 20 and 21 herein. A Reload Option provision provides that if the Eligible Person pays the exercise price of shares of Stock to be purchased by the exercise of an ISO, NSO or another Reload Option (the "Original Option") by delivering to the Corporation shares of Stock already owned by the Eligible Person (the "Tendered Shares"), the Eligible Person shall receive a Reload Option which shall be a new Option to purchase shares of Stock equal in number to the tendered shares. The terms of any Reload Option shall be determined by the Board or the Stock Option Committee consistent with the provisions of this Plan.

9. STOCK OPTION COMMITTEE. The Stock Option Committee may be appointed from time to time by the Corporation's Board of Directors. The Board may from time to time remove members from or add members to the Stock Option Committee. The Stock Option Committee shall be constituted so as to permit the Plan to comply in all respects with the provisions set forth in Paragraph 20 herein. The members of the Stock Option Committee may elect one of its members as its chairman. The Stock Option Committee shall hold its meetings at such times and places as its chairman shall determine. A majority of the Stock Option Committee's members present in person shall constitute a quorum for the transaction of business. All determinations of the Stock Option Committee will be made by the majority vote of the members constituting the quorum. The members may participate in a meeting of the Stock Option Committee by conference telephone or similar communications equipment by means of which all members participating in the meeting can hear each other. Participation in a meeting in that manner will constitute presence in person at the meeting. Any decision or determination reduced to writing and signed by all members of the Stock Option Committee will be effective as if it had been made by a majority vote of all members of the Stock Option Committee at a meeting which is duly called and held.

10. ADMINISTRATION OF PLAN. In addition to granting Options and to exercising the authority granted to it elsewhere in this Plan, the Board or the Stock Option Committee is granted the full right and authority to interpret and construe the provisions of this Plan, promulgate, amend and rescind rules and procedures relating to the implementation of the Plan and to make all other determinations necessary or advisable for the administration of the Plan, consistent, however, with the intent of the Corporation that Options granted or awarded pursuant to the Plan comply with the provisions of Paragraph 20 and 21 herein. All determinations made by the Board or the Stock Option Committee shall be final, binding and conclusive on all persons including the Eligible Person, the Corporation and its stockholders, employees, officers and directors and consultants. No member of the Board or the Stock Option Committee will be liable for any act or omission in connection with the administration of this Plan unless it is attributable to that member's willful misconduct.

11. PROVISIONS APPLICABLE TO ISOS. The following provisions shall apply to all ISOs granted by the Board or the Stock Option Committee and are incorporated by reference into any writing granting an ISO:

(a) An ISO may only be granted within ten (10) years from _____________, 1996, the date that this Plan was originally adopted by the Corporation's Board of Directors.

(b) An ISO may not be exercised after the expiration of ten (10) years from the date the ISO is granted.

(c) The option price may not be less than the fair market value of the Stock at the time the ISO is granted.

(d) An ISO is not transferrable by the Eligible Person to whom it is granted except by will, or the laws of descent and distribution, and is exercisable during his or her lifetime only by the Eligible Person.

(e) If the Eligible Person receiving the ISO owns at the time of the grant stock possessing more than ten (10%) percent of the total combined voting power of all classes of stock of the employer corporation or of its parent or subsidiary corporation (as those terms are defined in the Code), then the option price shall be at least 110% of the fair market value of the Stock, and the ISO shall not be exercisable after the expiration of five (5) years from the date the ISO is granted.

(f) The aggregate fair market value (determined at the time the ISO is granted) of the Stock with respect to which the ISO is first exercisable by the Eligible Person during any calendar year (under this Plan and any other incentive stock option plan of the Corporation) shall not exceed $100,000.

(g) Even if the shares of Stock which are issued upon exercise of an ISO are sold within one year following the exercise of such ISO so that the sale

constitutes a disqualifying disposition for ISO treatment under the Code, no provision of this Plan shall be construed as prohibiting such a sale.

(h) This Plan was adopted by the Corporation on __________, 1996, by virtue of its approval by the Corporation's Board of Directors. Approval by the stockholders of the Corporation is to occur prior to ____________, 1996.

12. DETERMINATION OF FAIR MARKET VALUE. In granting ISOs under this Plan, the Board or the Stock Option Committee shall make a good faith determination as to the fair market value of the Stock at the time of granting the ISO.

13. RESTRICTIONS ON ISSUANCE OF STOCK. The Corporation shall not be obligated to sell or issue any shares of Stock pursuant to the exercise of an Option unless the Stock with respect to which the Option is being exercised is at that time effectively registered or exempt from registration under the Securities Act of 1933, as amended, and any other applicable laws, rules and regulations. The Corporation may condition the exercise of an Option granted in accordance herewith upon receipt from the Eligible Person, or any other purchaser thereof, of a written representation that at the time of such exercise it is his or her then present intention to acquire the shares of Stock for investment and not with a view to, or for sale in connection with, any distribution thereof; except that, in the case of a legal representative of an Eligible Person, "distribution" shall be defined to exclude distribution by will or under the laws of descent and distribution. Prior to issuing any shares of Stock pursuant to the exercise of an Option, the Corporation shall take such steps as it deems necessary to satisfy any withholding tax obligations imposed upon it by any level of government.

14. EXERCISE IN THE EVENT OF DEATH OF TERMINATION OR EMPLOYMENT.

(a) If an optionee shall die (i) while an employee of the Corporation or a Subsidiary or (ii) within three months after termination of his employment with the Corporation or a Subsidiary because of his disability, or retirement or otherwise, his Options may be exercised, to the extent that the optionee shall have been entitled to do so on the date of his death or such termination of employment, by the person or persons to whom the optionee's right under the Option pass by will or applicable law, or if no such person has such right, by his executors or administrators, at any time, or from time to time. In the event of termination of employment because of his death while an employee or because of disability, his Options may be exercised not later than the expiration date specified in Paragraph 5 or one year after the optionee's death, whichever date is earlier, or in the event of termination of employment because of retirement or otherwise, not later than the expiration date specified in Paragraph 5 hereof or one year after the optionee's death, whichever date is earlier.

(b) If an optionee's employment by the Corporation or a Subsidiary shall terminate because of his disability and such optionee has not died within the following three months, he may exercise his Options, to the extent that he shall have been entitled to do so at the date of the termination of his

employment, at any time, or from time to time, but not later than the expiration date specified in Paragraph 5 hereof or one year after termination of employment, whichever date is earlier.

(c) If an optionee's employment shall terminate by reason of his retirement in accordance with the terms of the Corporation's tax-qualified retirement plans or with the consent of the Board or the Stock Option Committee or involuntarily other than by termination for cause, and such optionee has not died within the following three months, he may exercise his Option to the extent he shall have been entitled to do so at the date of the termination of his employment, at any time and from to time, but not later than the expiration date specified in Paragraph 5 hereof or thirty (30) days after termination of employment, whichever date is earlier. For purposes of this Paragraph 14, termination for cause shall mean termination of employment by reason of the optionee's commission of a felony, fraud or willful misconduct which has resulted, or is likely to result, in substantial and material damage to the Corporation or a Subsidiary, all as the Board or the Stock Option Committee in its sole discretion may determine.

(d) If an optionee's employment shall terminate for any reason other than death, disability, retirement or otherwise, all right to exercise his Option shall terminate at the date of such termination of employment.

15. CORPORATE EVENTS. In the event of the proposed dissolution or liquidation of the Corporation, a proposed sale of all or substantially all of the assets of the Corporation, a merger or tender for the Corporation's shares of Common Stock the Board of Directors shall declare that each Option granted under this Plan shall terminate as of a date to be fixed by the Board of Directors; provided that not less than thirty (30) days written notice of the date so fixed shall be given to each Eligible Person holding an Option, and each such Eligible Person shall have the right, during the period of thirty (30) days preceding such termination, to exercise his Option as to all or any part of the shares of Stock covered thereby, including shares of Stock as to which such Option would not otherwise be exercisable. Nothing set forth herein shall extend the term set for purchasing the shares of Stock set forth in the Option.

16. NO GUARANTEE OF EMPLOYMENT. Nothing in this Plan or in any writing granting an Option will confer upon any Eligible Person the right to continue in the employ of the Eligible Person's employer, or will interfere with or restrict in any way the right of the Eligible Person's employer to discharge such Eligible Person at any time for any reason whatsoever, with or without cause.

17. NONTRANSFERABILITY. No Option granted under the Plan shall be transferable other than by will or by the laws of descent and distribution. During the lifetime of the optionee, an Option shall be exercisable only by him.

18. NO RIGHTS AS STOCKHOLDER. No optionee shall have any rights as a stockholder with respect to any shares subject to his Option prior to the date of issuance to him of a certificate or certificates for such shares.

19. AMENDMENT AND DISCONTINUANCE OF PLAN. The Corporation's Board of Directors may amend, suspend or discontinue this Plan at any time. However, no such action may prejudice the rights of any Eligible Person who has prior thereto been granted Options under this Plan. Further, no amendment to this Plan which has the effect of (a) increasing the aggregate number of shares of Stock subject to this Plan (except for adjustments pursuant to Paragraph 3 herein), or
(b) changing the definition of Eligible Person under this Plan, may be effective unless and until approval of the stockholders of the Corporation is obtained in the same manner as approval of this Plan is required. The Corporation's Board of Directors is authorized to seek the approval of the Corporation's stockholders for any other changes it proposes to make to this Plan which require such approval, however, the Board of Directors may modify the Plan, as necessary, to effectuate the intent of the Plan as a result of any changes in the tax, accounting or securities laws treatment of Eligible Persons and the Plan, subject to the provisions set forth in this Paragraph 19, and Paragraphs 20 and 21.

20. COMPLIANCE WITH RULE 16B-3. This Plan is intended to comply in all respects with Rule 16b-3 ("Rule 16b-3") promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), with respect to participants who are subject to Section 16 of the Exchange Act, and any provision(s) herein that is/are contrary to Rule 16b-3 shall be deemed null and void to the extent appropriate by either the Stock Option Committee or the Corporation's Board of Directors.

21. COMPLIANCE WITH CODE. The aspects of this Plan on ISOs is intended to comply in every respect with Section 422 of the Code and the regulations promulgated thereunder. In the event any future statute or regulation shall modify the existing statute, the aspects of this Plan on ISOs shall be deemed to incorporate by reference such modification. Any stock option agreement relating to any Option granted pursuant to this Plan outstanding and unexercised at the time any modifying statute or regulation becomes effective shall also be deemed to incorporate by reference such modification and no notice of such modification need be given to optionee.

If any provision of the aspects of this Plan on ISOs is determined to disqualify the shares purchasable pursuant to the Options granted under this Plan from the special tax treatment provided by Code Section 422, such provision shall be deemed null and void and to incorporate by reference the modification required to qualify the shares for said tax treatment.

22. COMPLIANCE WITH OTHER LAWS AND REGULATIONS. The Plan, the grant and exercise of Options thereunder, and the obligation of the Corporation to sell and deliver Stock under such options, shall be subject to all applicable federal and state laws, rules, and regulations and to such approvals by any government or regulatory agency as may be required. The Corporation shall not be required to issue or deliver any certificates for shares of Stock prior to (a) the listing of such shares on any stock exchange or over-the-counter market on which the Stock may then be listed and (b) the completion of any registration or qualification of such shares under any federal or state law, or any ruling or regulation of any government body which the Corporation shall, in its sole

discretion, determine to be necessary or advisable. Moreover, no Option may be exercised if its exercise or the receipt of Stock pursuant thereto would be contrary to applicable laws.

23. DISPOSITION OF SHARES. In the event any share of Stock acquired by an exercise of an Option granted under the Plan shall be transferable other than by will or by the laws of descent and distribution within two years of the date such Option was granted or within one year after the transfer of such Stock pursuant to such exercise, the optionee shall give prompt written notice thereof to the Corporation or the Stock Option Committee.

24. NAME. The Plan shall be known as the "T/F Purifiner 1996 Stock Option Plan."

25. NOTICES. Any notice hereunder shall be in writing and sent by certified mail, return receipt requested or by facsimile transmission (with electronic or written confirmation of receipt) and when addressed to the Corporation shall be sent to it at its office, 3020 High Ridge Road, Suite 100, Boynton Beach, Florida 33426 and when addressed to the Committee shall be sent to it 3020 High Ridge Road, Suite 100, Boynton Beach, Florida 33426, subject to the right of either party to designate at any time hereafter in writing some other address, facsimile number or person to whose attention such notice shall be sent.

26. HEADINGS. The headings preceding the text of Sections and subparagraphs hereof are inserted solely for convenience of reference, and shall not constitute a part of this Plan nor shall they affect its meaning, construction or effect.

27. EFFECTIVE DATE. This Plan, the T/F Purifiner, Inc. 1996 Stock Option Plan, was adopted by the Board of Directors of the Corporation on ____________________. The effective date of the Plan shall be the same date.

Dated as of _________, 1996.

T/F PURIFINER, INC.

By:___________________________
Its: President

[NSO GRANT FORM]

T/F PURIFINER, INC.
3020 High Ridge Road, Suite 100
Boynton Beach, Florida 33426

Date: __________

Dear __________:

The Board of Directors of T/F Purifiner, Inc.(the "Corporation") is pleased to award you an Option pursuant to the provisions of the 1996 Stock Option Plan (the "Plan"). This letter will describe the Option granted to you. Attached to this letter is a copy of the Plan. The terms of the Plan also set forth provisions governing the Option granted to you. Therefore, in addition to reading this letter you should also read the Plan. Your signature on this letter is an acknowledgement to us that you have read and under-stand the Plan and that you agree to abide by its terms. All terms not defined in this letter shall have the same meaning as in the Plan.

1. TYPE OF OPTION. You are granted an NSO. Please see in particular
Section 11 of the Plan.

2. RIGHTS AND PRIVILEGES. Subject to the conditions hereinafter set forth, we grant you the right to purchase __________ shares of Stock at $__________ per share, the current fair market value of a share of Stock. The right to purchase the shares of Stock accrues in __________ installments over the time periods described below:

The right to acquire __________ shares accrues on __________.

The right to acquire __________ shares accrues on __________.

3. TIME OF EXERCISE. The Option may be exercised at any time and from time to time beginning when the right to purchase the shares of Stock accrues and ending when they terminate as provided in Section 5 of this letter.

4. METHOD OF EXERCISE. The Options shall be exercised by written notice to the Chairman of the Board of Directors at the Corporation's principal place of business. The notice shall set forth the number of shares of Stock to be acquired and shall contain a check payable to

the Corporation in full payment for the Stock or that number of already owned shares of Stock equal in value to the total Exercise Price of the Option. We shall make delivery of the shares of Stock subject to the conditions described in Section 13 of the Plan.

5. TERMINATION OF OPTION. To the extent not exercised, the Option shall terminate upon the first to occur of the following dates:

(a) __________, 199_, being __________ years from the date of grant pursuant to the provisions of Section 2 of this Agreement; or

(b) The expiration of three months following the date your employment terminates with the Corporation and any of its subsidiaries included in the Plan for any reason, other than by reason of death or permanent disability. As used herein, "permanent disability" means your inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months; or

(c) The expiration of 12 months following the date your employment terminates with the Corporation and any of its subsidiaries included in the Plan, if such employment termination occurs by reason of your death or by reason of your permanent disability (as defined above).

6. SECURITIES LAWS.

The Option and the shares of Stock underlying the Option have not been registered under the Securities Act of 1933, as amended (the "Act"). The Corporation has no obligations to ever register the Option or the shares of Stock underlying the Option. All shares of Stock acquired upon the exercise of the Option shall be "restricted securities" as that term is defined in Rule 144 promulgated under the Act. The certificate representing the shares shall bear an appropriate legend restricting their transfer. Such shares cannot be sold, transferred, assigned or otherwise hypothecated without registration under the Act or unless a valid exemption from registration is then available under applicable federal and state securities laws and the Corporation has been furnished with an opinion of counsel satisfactory in form and substance to the Corporation that such registration is not required.

7. BINDING EFFECT. The rights and obligations described in this letter shall inure to the benefit of and be binding upon both of us, and our respective heirs, personal representatives, successors and assigns.

8. DATE OF GRANT. The Option shall be treated as having been granted to you on the date of this letter even though you may sign it at a later date.

Very truly yours,

By:_______________________________ President

AGREED AND ACCEPTED:

Date: ________________

T/F PURIFINER, INC.
3020 High Ridge Road, Suite 100
Boynton Beach, Florida 33426

Dear _______________:

The Board of Directors of T/F Purifiner, Inc.(the "Corporation") is pleased to award you an Option pursuant to the provisions of the 1996 Stock Option Plan (the "Plan"). This letter will describe the Option granted to you. Attached to this letter is a copy of the Plan. The terms of the Plan also set forth provisions governing the Option granted to you. Therefore, in addition to reading this letter you should also read the Plan. Your signature on this letter is an acknowledgement to us that you have read and under-stand the Plan and that you agree to abide by its terms. All terms not defined in this letter shall have the same meaning as in the Plan.

1. TYPE OF OPTION. You are granted an ISO. Please see in particular
Section 11 of the Plan.

2. RIGHTS AND PRIVILEGES. Subject to the conditions hereinafter set forth, we grant you the right to purchase __________ shares of Stock at $__________ per share, the current fair market value of a share of Stock. The right to purchase the shares of Stock accrues in __________ installments over the time periods described below:

The right to acquire __________ shares accrues on __________.

The right to acquire __________ shares accrues on __________.

The right to acquire __________ shares accrues on __________.

The right to acquire __________ shares accrues on __________.

The right to acquire __________ shares accrues on __________.

The right to acquire __________ shares accrues on __________.

3. TIME OF EXERCISE. The Option may be exercised at any time and from time to time beginning when the right to purchase the shares of Stock accrues and ending when they terminate as provided in Section 5 of this letter.

4. METHOD OF EXERCISE. The Options shall be exercised by written notice to the Chairman of the Board of Directors at the Corporation's principal place of business. The notice shall set forth the number of shares of Stock to be acquired and shall contain a check payable to the Corporation in full payment for the Stock or that number of already owned shares of Stock equal in value to the total Exercise Price of the Option. We shall make delivery of the shares of Stock subject to the conditions described in Section 13 of the Plan.

5. TERMINATION OF OPTION. To the extent not exercised, the Option shall terminate upon the first to occur of the following dates:

(a) _____________, 199___, being __________ years from the date of grant pursuant to the provisions of Section 2 of this Agreement; or

(b) The expiration of thirty (30) days following the date your employment terminates with the Corporation and any of its subsidiaries included in the Plan for any reason, other than by reason of death or permanent disability. As used herein, "permanent disability" means your inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months; or

(c) The expiration of 12 months following the date your employment terminates with the Corporation and any of its subsidiaries included in the Plan, if such employment termination occurs by reason of your death or by reason of your permanent disability (as defined above).

6. SECURITIES LAWS.

The Option and the shares of Stock underlying the Option have not been registered under the Securities Act of 1933, as amended (the "Act"). The Corporation has no obligations to ever register the Option or the shares of Stock underlying the Option. All shares of Stock acquired upon the exercise of the Option shall be "restricted securities" as that term is defined in Rule 144 promulgated under the Act. The certificate representing the shares shall bear an appropriate legend restricting their transfer. Such shares cannot be sold, transferred, assigned or otherwise hypothecated without registration under the Act or unless a valid exemption from registration is then available under applicable federal and state securities laws and the Corporation has been furnished with an opinion of counsel satisfactory in form and substance to the Corporation that such registration is not required.

7. BINDING EFFECT. The rights and obligations described in this letter shall inure to the benefit of and be binding upon both of us, and our respective heirs, personal representatives, successors and assigns.

8. DATE OF GRANT. The Option shall be treated as having been granted to you on the date of this letter even though you may sign it at a later date.

Very truly yours,

By:_______________________________ President

AGREED AND ACCEPTED:

[NSO GRANT FORM
WITH RELOAD OPTIONS]

T/F PURIFINER, INC.
3020 High Ridge Road, Suite 100
Boynton Beach, Florida 33426

Date: __________

Dear __________:

The Board of Directors of T/F Purifiner, Inc. (the "Corporation") is pleased to award you an Option pursuant to the provisions of the 1996 Stock Option Plan (the "Plan"). This letter will describe the Option granted to you. Attached to this letter is a copy of the Plan. The terms of the Plan also set forth provisions governing the Option granted to you. Therefore, in addition to reading this letter you should also read the Plan. Your signature on this letter is an acknowledgement to us that you have read and understand the Plan and that you agree to abide by its terms. All terms not defined in this letter shall have the same meaning as in the Plan.

1. TYPE OF OPTION. You are granted an NSO. Please see in particular
Section 11 of the Plan.

2. RIGHTS AND PRIVILEGES.

(a) Subject to the conditions hereinafter set forth, we grant you the right to purchase __________ shares of Stock at $__________ per share, the current fair market value of a share of Stock. The right to purchase the shares of Stock accrues in __________ installments over the time periods described below:

The right to acquire __________ shares accrues on __________.

The right to acquire __________ shares accrues on __________.

(b) In addition to the Option granted hereby (the "Underlying Option"), the Corporation will grant you a reload option (the "Reload Option") as hereinafter provided. A Reload Option is hereby granted to you if you acquire shares of Stock pursuant to the exercise of the Underlying Option and pay for

such shares of Stock with shares of Common Stock already owned by you (the "Tendered Shares"). The Reload Option grants you the right to purchase shares of Stock equal in number to the number of Tendered Shares. The date on which the Tendered Shares are tendered to the Corporation in full or partial payment of the purchase price for the shares of Stock acquired pursuant to the exercise of the Underlying Option is the Reload Grant Date. The exercise price of the Reload Option is the fair market value of the Tendered Shares on the Reload Grant Date. The fair market value of the Tendered Shares shall be the low bid price per share of the Corporation's Common Stock on the Reload Grant Date. The Reload Option shall vest equally over a period of __________ (___) years, commencing on the first anniversary of the Reload Grant Date, and on each anniversary of the Reload Grant Date thereafter; however, no Reload Option shall vest in any calendar year if it would allow you to purchase for the first time in that calendar year shares of Stock with a fair market value in excess of $100,000, taking into account ISOs previously granted to you. The Reload Option shall expire on the earlier of (i) __________ (___) years from the Reload Grant Date, or (ii) in accordance with Paragraph 5(b), or (iii) in accordance with Paragraph 5(c) as set forth herein. If vesting of the Reload Option is deferred, then the Reload Option shall vest in the next calendar year, subject, however, to the deferral of vesting previously provided. Except as provided herein the Reload Option is subject to all of the other terms and provisions of this Agreement governing Options.

3. TIME OF EXERCISE. The Option may be exercised at any time and from time to time beginning when the right to purchase the shares of Stock accrues and ending when they terminate as provided in Section 5 of this letter.

4. METHOD OF EXERCISE. The Options shall be exercised by written notice to the Chairman of the Board of Directors at the Corporation's principal place of business. The notice shall set forth the number of shares of Stock to be acquired and shall contain a check payable to the Corporation in full payment for the Stock or that number of already owned shares of Stock equal in value to the total Exercise Price of the Option. We shall make delivery of the shares of Stock subject to the conditions described in Section 13 of the Plan.

5. TERMINATION OF OPTION. To the extent not exercised, the Option shall terminate upon the first to occur of the following dates:

(a) __________, 199_, being __________ years from the date of grant pursuant to the provisions of Section 2 of this Agreement; or

(b) The expiration of three months following the date your employment terminates with the Corporation and any of its subsidiaries included in the Plan for any reason, other than by reason of death or permanent disability. As used herein, "permanent disability" means your inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months; or

(c) The expiration of 12 months following the date your employment terminates with the Corporation and any of its subsidiaries included in the Plan, if such employment termination occurs by reason of your death or by reason of your permanent disability (as defined above).

6. SECURITIES LAWS.

The Option and the shares of Stock underlying the Option have not been registered under the Securities Act of 1933, as amended (the "Act"). The Corporation has no obligations to ever register the Option or the shares of Stock underlying the Option. All shares of Stock acquired upon the exercise of the Option shall be "restricted securities" as that term is defined in Rule 144 promulgated under the Act. The certificate representing the shares shall bear an appropriate legend restricting their transfer. Such shares cannot be sold, transferred, assigned or otherwise hypothecated without registration under the Act or unless a valid exemption from registration is then available under applicable federal and state securities laws and the Corporation has been furnished with an opinion of counsel satisfactory in form and substance to the Corporation that such registration is not required.

7. BINDING EFFECT. The rights and obligations described in this letter shall inure to the benefit of and be binding upon both of us, and our respective heirs, personal representatives, successors and assigns.

8. DATE OF GRANT. The Option shall be treated as having been granted to you on the date of this letter even though you may sign it at a later date.

Very truly yours,

By:_______________________________ President

AGREED AND ACCEPTED:

AGREEMENT BETWEEN
T/F SYSTEMS, INC.
AND T/F PURIFINER, INC.
DATED MARCH 1, 1991
(WITH EXHIBITS)

This Agreement is effective the first day of March, 1991, and is by and between T/F Systems, Inc., a corporation of Delaware, having an office and place of business at 14402 Cypress Island Court, Palm Beach Gardens, Florida 33410 (hereinafter "TFS"), and T/F Purifiner, Inc., a corporation of Delaware, having an office and place of business at 14402 Cypress Island Court, Palm Beach Gardens, Florida 33410 (hereinafter "TFP").

On July 30, 1987, Willard H. Taylor and Richard C. Ford (hereinafter "TF") entered into a distribution and manufacturing agreement (Exhibit A hereto) with Refineco Manufacturing Company, Inc., then a Florida corporation with a principal place of business at 3553 Northwest 10th Avenue, Oakland Park, Florida 33309 (hereinafter "Refineco"), for electric refiners, filters and accessories primarily for engines in vehicles and vessels (hereinafter "refiners") which are sold under the trademark PURIFINER, and also covered by patents. Subsequently, that Agreement, pursuant to its terms, was assigned by TF, effective December 4, 1987, to TFS (Exhibit B hereto). Further, worldwide manufacturing and marketing rights under the Agreement were provided to TFS from Refineco by documents dated June 18, 1990 and December 10, 1988 (attached hereto as Exhibit C). These Agreements related to electric refiners, filters and accessories primarily for engines in vehicles and vessels (hereinafter "refiners") which are sold under the trademark PURIFINER, and also covered by patents.

Since TFS has worldwide manufacturing and marketing rights with respect to refiners sold under the trademark PURIFINER;

Since TFS desires to protect its viability for profitability and not to expose its manufacturing rights to the refiners to the uncertainty of marketing and other costs of worldwide distribution of the products with no assurance of profitability;

Since TFS has manufacturing interest and the capability to arrange for manufacture and is interested in doing the same, for refiners; and

Since TFS is fully aware that TFP may in the future undertake financing obligations and/or private or public offering of its shares in order to obtain required funds to properly market the refiners;

Now, therefore, in consideration of the mutual promises set forth in this Agreement and for the purposes set forth above, TFP and TFS hereby agree as follows:

1. TFS agrees to sell on an exclusive basis all refiners manufactured by it to TFP. The cost of sale will be the actual manufacturing cost to TFS plus a fifteen percent (15%) mark-up over direct cost. Billings from TFS and TFP shall be on a monthly basis, acceptable terms mutually agreed to from time to time.

2. TFP is hereby granted by TFS worldwide marketing rights to the refiners, and will assume all costs of distribution of the refiners including, but not limited to, all advertising, marketing, selling and distribution costs.

3. TFS will be entitled to and receive a ten percent (105%) net profit after all costs of manufacturing and other costs of expenses including tooling amortization and royalty payments due on the sale of refiners pursuant to the Agreements of July 30, 1987 and June 18, 1990 mentioned above.

4. TFP will not buy refiners from any other source without the express written approval of TFS.

5. TFS does not warrant that it has any rights aside from those set forth in the July 30, 1987, December 10, 1988 and June 18, 1990 Agreements.

6. TFS will use, on any literature associated with the refiners sold pursuant to this Agreement, some sort of indication that TFS is the licensee of the "PURIFINER" trademark, and may, if TFP desires, reference the patents covering the refiners as long as those patents are in force.

7. This Agreement will remain in force for fifteen (15) years from the effective date thereof, at which time it may be renewed by agreement between the parties. When the patents covering the refiners sold pursuant to the Agreement expire, royalty payments will no longer be due by TFS to other entities, and that will no longer be considered a cost to TFS for determining the sales price of refiners to TFP; however, royalty for the PURIFINER trademark will continue to be a cost to TFS as long as the trademark is being used and the underlying Agreements are in force.

8. Neither party will assign any rights or obligations under this Agreement to any other entity without the written approval of the other party, which approval will not be unreasonably withheld.

9. Upon breach of this Agreement by either party, the breaching party will be notified of the breach in writing and will have fifteen (15) days to correct the breach. If it is not corrected within fifteen (15) days then the non-breaching party may terminate this Agreement in addition to any other remedies that it may have.

10. This is the complete understanding between the parties and may not be modified except in writing and signed by the parties.

11. This Agreement and all terms and provisions thereof will be interpreted in accordance with the laws of the State of Florida, the courts of which (Federal and State) will have exclusive jurisdiction.

12. If any provision of this Agreement should be considered invalid by a court of competent jurisdiction, then the parties will work to reform the Agreement so as to remove the invalid provision yet effect the intent of the parties in entering into this Agreement, and the Agreement shall not, merely because one provision is deemed invalid or unenforceable, terminate.

13. The signatures below indicate complete agreement with the terms set forth above, executed this 2nd day of September, 1991.

T/F SYSTEMS, INC.

Corporate Seal                            By:     /S/ RICHARD C. FORD
                                             ---------------------------------
                                             Richard C. Ford, President

T/F PURIFINER, INC.

By:   /S/ WILLARD H. TAYLOR
   ---------------------------------
   Willard H. Taylor, Vice President

Corporate Seal

THIS AGREEMENT, made this 30TH day of July, 1987, by and between Refineco

Manufacturing Company, Inc., a Florida corporation, with its principal place of

business at 3553 N.W. 10th Avenue, Oakland Park, Florida 33309 ("REFINECO"), as

Party of the First Part, and WILLARD H. TAYLOR, a natural person residing at

Fort Lauderdale, Florida, and RICHARD C. FORD, a natural person residing in

Jupiter, Florida (collectively "TF").

REFINECO is a manufacturing company which manufacturers electric mobile

oil refiners, filters, and accessories ("PRODUCTS"), and sells them under the

trademark "PUREFINER", and is in need of working capital and is desirous of

enlisting the efforts and abilities of TF in distributing PRODUCTS.

TF are interested in loaning working capital to REFINECO, properly secured

and in distributing PRODUCTS.

In consideration of the mutual promises set forth in this Agreement,

REFINECO and TF agree as follows:

1. TF agrees to lend to REFINECO the sum of One Hundred Thousand and

no/100 ($100,000.00) Dollars (the "Loan Amount"). Earlier, TF had required that

REFINECO sever all connections with one William D. Wessinger, in connection with

an exclusive contract for distribution which was entered into between REFINECO

and Wessinger. REFINECO has met with Wessinger, and Wessinger has demanded

excessive consideration for cancellation of the said distribution agreement,

even though REFINECO represents that Wessinger has not lived up to his

requirements and obligations under said contract. REFINECO represents that it

has given notice to said William D. Wessinger of the termination of said

exclusive contract for distribution of products of REFINECO. REFINECO agrees

that it will defend itself in the event of any litigation which may be brought

by Wessinger against REFINECO, for alleged breach of contract. REFINECO

represents to TF that Wessinger is in default of his undertakings under the said

distribution contract, and that Wessinger has provided no sales of consequence

to REFINECO. By acceptance of the loan amount, REFINECO specifically warrants

that it has no other in-force and/or applicable other agreements which are in

conflict with this agreement, or the rights transferred to TF by this Agreement.

2. Interest will also be paid on THE LOAN AMOUNT. The interest will be

due on each yearly anniversary of the effective date of this agreement, and will

be payable at the rate of 8% per annum, simple interest. Whenever the THE LOAN

AMOUNT is repaid, such as pursuant to any of the conditions set forth in

paragraph 5, below, in addition to the principal being repaid an interest

payment will also be made in the amount of 8% of the THE LOAN AMOUNT times the

number of months since the last anniversary payment (if any). The loan repayment

will not be considered satisfied unless this interest payment is also made. THE

LOAN AMOUNT, plus the appropriate amount of interest at the time of repayment,

is "THE REPAY AMOUNT".

3. THE REPAY AMOUNT will be secured by financing statements signed by

REFINECO and recorded in the records of the Patent and Trademark Office with

respect to U.S. Patents 4,189,351, 4,227,969, and 4,289,583, and the trademark

"PUREFINER", and any presently pending patent applications or intellectual

property rights subsequently acquired by REFINECO. Attached as Exhibits A and B

are a financing statement that will be executed by REFINECO when THE LOAN AMOUNT

is conveyed to REFINECO, and the financing statements will be returned to to TF

for recordation in the records of the Patent and Trademark Office, and the State

of Florida. Upon THE REPAY AMOUNT being actually received by TF, TF will file

releases of the financing statements.

4. TF will become a master distributor of PRODUCTS, and will have

exclusive rights to distribute PRODUCTS for all fields of use, in the States of

Florida, New York, New Jersey, and Massachusetts. TF will be required to carry

an inventory of PRODUCTS sufficient to service the territorial markets assigned

to TF. Initially, the amount of inventory required to be carried shall be

determined by TF, but after 365 days, REFINECO and TF shall consult regarding

the setting of inventory levels by meeting, reviewing sales, areas in which

sales are being made, and the areas wherein are required additional amount of

PRODUCTS. Inventories shall then be adjusted so that the supply of PRODUCTS in a

sales area shall be sufficient to support such markets as determined by TF and

PRODUCTS jointly. There are no initial minimum inventory requirements (aside

form what TF reasonably believe is adequate to support sales efforts in the

States of Florida, New York, New Jersey, and Massachusetts. The $20,500.00

presently due to be paid in September, 1987, from REFINECO to TF shall be

utilized to purchase initial inventory of products for resale by TF in the

market area assigned to TF by REFINECO.

5. THE REPAY AMOUNT will become completely due and immediately payable

upon the occurrence of any one of the three following events:

A. Three years from the effective date of this Agreement.

B. If REFINECO become insolvent, bankrupt, files for bankruptcy,

files for reorganization, or otherwise loses control of its destiny.

C. Should REFINECO enter into any agreement or understanding to sell

REFINECO, or any part thereof (including but not limited to its patent rights or

trademark rights), or to recapitalize (e.g. make a public stock or bond

offering). In this latter event, (C), TF, at their sole option, may elect to

accept, in lieu of THE REPAY AMOUNT, one per cent (1%) of the common voting

stock in REFINECO (just prior to any sale of all or part of REFINECO, or any

recapitalization).

D. REFINECO shall have the continuing right and option to pre-pay,

in full, at any time, THE REPAY AMOUNT.

E. Regardless of whether REFINECO has paid THE REPAY AMOUNT to TF,

TF shall have a continuing option, during the full term of three years from date

hereof, to purchase 1% of all stock of REFINECO, at the purchase price of

$100,000.00, payable in cash, or if THE REPAY AMOUNT has not, at the time TF

desires to exercise this option to purchase stock, been fully paid to TF, TF may

cause such unpaid portion of THE REPAY AMOUNT as it may wish to be credited

against the said stock purchase price.

6. At any time, whether or not THE REPAY AMOUNT is then due, TF may, at

their sole option, convert THE REPAY AMOUNT to one per cent (1%) of the common

voting stock of REFINECO at the time of conversion. The time of conversion will

be considered the time when TF delivers a written demand to REFINECO by hand, or

to a cable or telex company for deliver to REFINECO, or deposits the written

demand addressed to REFINECO in the U.S. registered or certified mail.

7. TF will not engage in the sale of or manufacture of any electrical oil

refiners, filters, or accessories except PRODUCTS, for the duration of this

Agreement, and will not disclose confidential information to others not under an

obligation of confidentiality with REFINECO.

8. TF will not assign any rights or obligations under this Agreement to

any other entity without the written approval of REFINECO, which approval shall

not be unreasonably withheld, except that TF may assign their rights and

obligations under this Agreement to any entity (whether partnership,

corporation, joint venture, etc.) in which they have an ownership interest

(either individually or collectively) of greater than ten per cent (10%), or in

which any child of either Taylor or Ford has an ownership interest, either

individually or collectively with Taylor and Ford, of greater than ten per cent

(10%). In no event, however, shall the interests, territorial assignment, and

rights created hereunder be sold, transferred, or assigned to any entity which

is owned more than five per cent by any company which has a substantive interest

in the oil or petroleum business, either distribution, refining, producing,

transporting or otherwise.

9. Notwithstanding any other provision of this Agreement, should REFINECO

become insolvent to the point that it cannot continue operations, come under the

jurisdiction of the bankruptcy court, and not be released within sixty (60) days

thereafter from such jurisdiction, file for bankruptcy, file for reorganization,

or otherwise lose control of its destiny, or no longer shall be able to supply

PRODUCTS to TF for a continuous period of one hundred five (105) days, TF will

automatically be entitled to commence manufacturing under the non-exclusive

right to manufacture granted to TF simultaneously herewith, and to use, and sell

PRODUCTS in territories assigned to TF under this Agreement (the States of

Florida, New York, New Jersey and Massachusetts), said rights to manufacture to

be under any patent rights of REFINECO, under Patent Numbers 4,189,351,

4,227,969 and 4,289,583, and any presently pending patent applications or

intellectual property rights acquired by REFINECO, or of any entity that may

become owner of the rights, and apply the PURIFINER trademark to the PRODUCTS.

TF will pay to REFINECO, or any entity taking the place of REFINECO under such

circumstances, a royalty of five percent (5%) of TF's sale price of PRODUCTS.

This royalty obligation will remain in full force and effect during the life of

any patents which cover PRODUCTS, but will be reduced to one per cent (1%), upon

the expiration of all patents, which one per cent (1%) rate will be for the

right to use the PURIFINER trademark. If REFINECO is able to reconstitute its

financial status, so that it may continue to manufacture and sell its products,

it may cancel the rights of TF to manufacture products normally manufactured by

REFINECO, by paying any additional costs to TF which TF may have actually

incurred due to the temporary inability of REFINECO to manufacture products for

resale.

10. The provision of paragraphs 4, 7, 8 and 9 of this Agreement wil

remain in effect indefinitely, unless breached by one of the parties, in which

case the breaching party will have thirty (30) days to remedy the breach, after

written notification of the breach by the non-breaching party; otherwise, they

will be in default.

11. Taylor is providing funds of Fifty Thousand and no/100 ($50,000.00)

Dollars as of date of this agreement, July 30, 1987, and Ford is to provide

funds of Fifty Thousand and no/100 ($50,000.00) Dollars and or about August 6,

1987. In the event, for any reason whatsoever, Ford funds are not forthcoming by

August 15, 1987, Taylor has the option to replacing Ford in this agreement by

providing the funds.

12. This is the entire Agreement between REFINECO and TF and any

modifications may be made only in writing. This Agreement will be interpreted in

accordance with the laws of the State of Florida, with jurisdiction by Florida

Courts.

13. The signatures below indicate complete agreement to the terms se

forth above.

Dated this 30TH
day of July, 1987.

REFINECO MANUFACTURING COMPANY, INC.

  /S/ BYRON LEFEBVRE
--------------------------------------
BY: BYRON LEFEBVRE, President and CEO

  /S/ JELLE P. SCHOEN
--------------------------------------
By: JELLE P. SCHOEN,
Chairman of the Board

Dated this 30TH
day of July, 1987.

  /S/ WILLARD H. TAYLOR
-------------------------------------
WILLARD H. TAYLOR

 /S/ RICHARD C. FORD
-------------------------------------
RICHARD C. FORD

STATE OF FLORIDA
COUNTY OF BROWARD

Before me personally appeared the above persons to me well known and known to me to be the persons described in and who executed the foregoing instrument, and acknowledged to and before me that they executed said instrument for the purposes therein expressed.

WITNESS my hand and official seal, this 30TH day of JULY , A.D., 1987.

This Agreement is effective the 4TH day of DECEMBER, 1987 and is by and between T/F Systems, Inc., a Delaware corporation with an office and place of business c/o N.A. Taylor Co., Inc., 10 W. 9th Avenue, Gloversville, New York 12078 ("Systems"), on the one hand, and Williard H. Taylor, a natural person residing in Fort Lauderdale, Florida, and Richard C. Ford, a natural person residing in Jupiter, Florida (collectively "TF") on the other hand.

TF have an Agreement dated July 30, 1987 with Refineco Manufacturing Company, Inc., a copy of which Agreement is attached hereto, and TF are desirous of operating under that Agreement via Systems, and have the right to assign this Agreement to Systems, its assigns, successors, and legal representatives, since Systems is an appropriate assignee pursuant to paragraph 8 of that Agreement.

Therefore, in consideration of one dollar ($1.00), and other good and valuable considerations not specified herein, paid by Systems to TF, TF hereby grant, assign, and transfer their entire right and interest pursuant to and in the Agreement of July 30, 1987 to Systems. TF agree to provide Refineco with a copy of this executed Agreement.

  /S/ WILLIARD H. TAYLOR                          /S/ RICHARD C. FORD
- ------------------------------                  --------------------------
Williard H. Taylor                              Richard C. Ford

Date:    12/4/87                                Date:    12/4/87
     -------------------------                       ---------------------

     Accepted by T/F Systems Inc.

                                                By:
                                                   -----------------------
                                                Name:
                                                Title:  Vice President
Date:      12/4/87
     ------------------------

June 18, 1990

T/F SYSTEMS, INC.
246 Hampton
Jupiter, FL 33458

Re: Refineco Manufacturing Company, Inc.

Dear Gentlemen:

This is to confirm that since Refineco Manufacturing Company, Inc. has not fulfilled the conditions and promises I described in my letter to you dated December 10, 1988, T/F Systems, Inc. has obtained exclusive worldwide manufacturing and marketing rights with respect to all products produced under the following properties:

1. U.S. Patent 4,189,351
2. U.S. Patent 4,227,969
3. U.S. Patent 4,289,583
4. Trademark "Purefiner"
5. All pending patents of Refineco

We expect payment of the royalties pursuant to our agreement dated July 30, 1987 and the aforementioned letter dated December 10, 1988.

Very truly yours,

/s/ Byron Lefebvre

REFINECO MANUFACTURING COMPANY, INC.
Byron Lefebvre, President

Sworn to and subscribed before me
this 18TH day of June, 1990.

    /S/ SHIRLEY D. BALDONI
- -------------------------------
NOTARY PUBLIC, State of Florida
                    at Large
My Commission Expires:

REFINECO

PURIFINER

December 10, 1988

Richard C. Ford
President
T/F Systems, Inc.
4385 Westroads Dr.
West Palm Beach, Fl. 33407

Dear Richard,

Refineco recognizes the fact that we are in breach of our agreement with T/F Systems in that we have lost control of our destiny and have not been able to fill your orders for over 105 days.

We know that you can exercise your rights stated in your agreement, dated July 30, 1987, but that you are giving Refineco a chance to rectify its breach under the following conditions:

1. That Purifiner Distribution Midwest corp., which will be getting the world-wide manufacturing and marketing rights and will be in production and furnish T/F Systems product on an exclusive basis for their territory within 18 months.

2. If number one does not occur and T/F Systems decides to exercise its manufacturing rights and marketing rights, they shall then be able to manufacture and market the PURIFINER and filters world-wide on an exclusive basis and pay the same Royalty as specified in the July 30, 1987 agreement with Refineco Manufacturing Co., Inc.

We all hope that everythig work out well and that you will not have to exercise your rights.

Sincerely,

/s/ Byron Lefebvre

Byron Lefebvre                            Richard C. Ford
President                                 President
                                          T/F Systems, Inc.
CC:   Frank DePaul                        /s/ Richard C. Ford
      Ron Holmes

ASSET PURCHASE AGREEMENT
BETWEEN
T/F SYSTEMS, INC.
AND
T/F PURIFINER, INC.
DATED DECEMBER 31, 1995

THIS ASSET PURCHASE AGREEMENT (the "Agreement') is made as of the 31st day of December, 1995, by and between T/F SYSTEMS, INC., a Delaware corporation (the "Seller"), and T/F PURIFINER, INC., a Delaware corporation (the "Buyer").

W I T N E S S E T H:

WHEREAS, Seller desires to sell and assign to Buyer and buyer desires to purchase and assume from Seller certain assets and liabilities of Seller according to the terms and conditions hereinafter provided.

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

1. PURCHASE AND SALE OF ASSETS.

1.1 ASSETS PURCHASED. Subject to the terms and conditions set forth in this Agreement, Seller hereby sells, transfers, conveys and delivers to Buyer and Buyer hereby purchases from Seller, as of the date hereof (the "Closing Date") all of the assets, properties and rights of Seller of every type and description, wherever located as the same shall exist at the close of business on the Closing Date (except for the Excluded Assets (hereinafter defined)) (collectively, the "Assets").

1.2 ASSETS NOT PURCHASED.The assets of Seller which are not being sold, conveyed, assigned or transferred hereunder are all of Seller's rights and interests in and to the proceeds of that certain Final Judgment in civil litigation styled T/F SYSTEMS, INC. V. SOUTHEAST CAPITAL FINANCING, ETC., ET AL., Case No. CL 90 12772 AE, and all of the bond proceeds and other revenues related thereto (collectively, the "Excluded Assets").

1.3 LIABILITIES ASSUMED. Subject to the terms and conditions set forth in this Agreement, Seller hereby agrees to transfer and assign, and Buyer hereby agrees to assume and perform and pay when due, all of the debts, liabilities, claims, obligations and contracts of Seller of every kind, character or description, whether accrued, absolute, contingent or otherwise existing at the Closing Date (except for the Excluded Liabilities (hereinafter defined)) (collectively, the "Liabilities").

1.4 LIABILITIES NOT ASSUMED. The liabilities of Seller which are not being assumed by Buyer hereunder are the following:

1.4.1 Seller's obligation to repay that certain loan owed to Richard C. Ford in the amount of $268,742.35 (the "Ford Loan");

1.4.2 Seller's obligation to repay that certain loan owed to the Estate of Willard H.Taylor in the amount of $268,742.35 (the "Taylor Loan");

1.4.3 Seller's liability in respect of those professional fees owed for the prosecution and collection of the Excluded Assets (the "Professional Fees") (the Ford Loan, Taylor Loan and Professional Fees are collectively referred to herein as the "Excluded Liabilities"); and

1.4.4 Seller's liability for repayment of bond proceeds received in respect of the Excluded Assets.

1.5 TRANSFER COSTS. Buyer hereby agrees to pay all transfer costs and taxes, documentary stamp taxes and amounts, recording costs, and all sales, transfer and license taxes, if any, resulting from the transactions contemplated by this Agreement.

2. PURCHASE PRICE. In addition to the assumption by Buyer of the Liabilities, in consideration for the consummation by Buyer of the transactions contemplated hereunder, Buyer does hereby assign to Seller any and all of Buyer rights and interests in and to the Excluded Assets (the "Purchase Price").

3. SELLER'S WARRANTIES AND REPRESENTATIONS. Seller warrants and represents to Buyer the following:

3.1 Seller is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware;

3.2 Seller is owner of all of the Assets and at the Closing Date shall have good and marketable title to the Assets free and clear of all liens and encumbrances except for (i) the lien of Larry Freedman on Seller's assets in respect of a promissory note payable to him with an outstanding balance of $101,804 and (ii) the lien of Caterpillar Financial Co. on a forklift in respect of a loan to Seller with an outstanding balance of $3,993; and

3.3 Seller has full authorization and right to enter into this Agreement and by signing this Agreement is not in breach of the terms of any other agreement or judgment or order of a judicial or administrative agency to or by which Seller is or may be bound to any third party.

4. BUYER'S WARRANTIES AND REPRESENTATIONS. Buyer warrants and represents to Seller the following:

4.1 Buyer is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware; and

4.2 Buyer has full authorization and right to enter into this Agreement and by signing this Agreement is not in breach of the terms of any other agreement or judgment or order of a judicial or administrative agency to or by which Buyer is or may be bound to any third party.

5. INDEMNITY.

5.1 In the event that any of the Excluded Assets have been pledged by Seller as collateral security for any of the Liabilities and any of the Excluded Assets are foreclosed, levied upon or acquired by a creditor of Seller (the "Foreclosed Asset") in complete or partial satisfaction of any of the Liabilities (the "Foreclosure"), Buyer agrees to indemnify Seller for the fair market value of the Foreclosed Asset within one (1) year of the Foreclosure.

5.2 Except as specifically provided for in Section 5.1 above, Seller agrees to indemnify Buyer on demand from and against all other liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs and expenses, including legal expenses, of whatever kind and nature, imposed on, incurred or asserted against Buyer, its agents, officers, attorneys, employees, directors, successors and assigns in any way relating to or arising out of the Excluded Assets and/or Excluded Liabilities.

6. CLOSING.

6.1 The consummation of the purchase and sale contemplated hereby (the "Closing") shall take place at the offices of Seller on the Closing Date, or such other time and place as shall be agreed upon by the parties in writing.

6.2 At Closing, Seller shall deliver or cause to be delivered to Buyer such bills of sale, endorsements, assignments and other good sufficient instruments of conveyance and transfer as shall be effective to vest in Buyer all of Seller's right, title and interest in and to the Assets.

6.3 Simultaneously, upon the consummation of the transfers above, Seller, through its officers, agents and employees, will put Buyer into full possession and enjoyment of the Assets conveyed and transferred under this Agreement.

7. MISCELLANEOUS.

7.1 BINDING EFFECT. All of the terms and provisions of this Agreement shall be binding upon, inure to the benefit of, and be enforceable by

the parties and their respective legal representatives, successors and permitted assigns, whether so expressed or not.

7.2 AMENDMENTS. The provisions of this Agreement may not be amended, supplemented, waived or changed orally, but only by a writing signed by the party as to whom enforcement of any such amendment supplement, waiver or modification is sought and making specific reference to this Agreement.

7.3 SEVERABILITY. If any provision of this Agreement or any other agreement entered into pursuant hereto is contrary to, prohibited by or deemed invalid under applicable law or regulation, such provision shall be inapplicable and deemed omitted to the extent so contrary, prohibited or invalid, but the remainder hereof shall not be invalidated thereby and shall be given full force and effect so far as possible. If any provision of this Agreement may be construed in two or more ways, one of which would render the provision invalid or otherwise voidable or unenforceable and another of which would render the provision valid and enforceable, such provision shall have the meaning which renders it valid and enforceable.

7.4 NOTICES. All notices, requests, consents and other communications required or permitted under this Agreement shall be in writing (including electronic transmission) and shall be (as elected by the person giving such notice) hand delivered by messenger or courier service, electronically transmitted, or mailed (airmail if international) by registered or certified mail (postage prepaid), return receipt requested, addressed to:

If to Buyer:                              If to Seller:

T/F Purifiner, Inc.                       T/F Systems, Inc.
3020 High Ridge Road, Suite 100           3020 High Ridge Road, Suite 100
Boynton Beach, Florida  33426             Boynton Beach, Florida  33426
Attn:  President                          Attn:  President

or to such other address as any party may designate by notice complying with the terms of this Section. Each such notice shall be deemed delivered (a) on the date delivered if by personal delivery; (b) on the date of transmission with confirmed answer back if by electronic transmission; and (c) on the date upon which the return receipt is signed or delivery is refused or the notice is designated by the postal authorities as not deliverable, as the case may be, if mailed.

7.5 SURVIVAL. All covenants, agreements, representations and warranties made herein or otherwise made in writing by any part pursuant hereto shall survive the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby.

7.6 HEADINGS. The headings contained in this Agreement are for convenience of reference only, are not to be considered a part of the Agreement and shall not limit or otherwise affect in any way the meaning or interpretation of this Agreement.

7.7 THIRD PARTIES. Unless expressly stated herein to the contrary, nothing in this Agreement, whether express or implied, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the parties hereto and their respective legal representatives, successors and permitted assigns. Nothing in this Agreement is intended to relieve or discharge the obligation or liability of any third persons to any party to this Agreement, nor shall any provision give any third persons any right of subrogation or action over or against any party to this Agreement.

7.8 GOVERNING LAW. This Agreement and all transactions contemplated by this Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Florida.

7.9 FURTHER ASSURANCES. The parties hereby agree from time to time to execute and deliver such further and other transfers, assignments and documents and do all matters and things which may be convenient or necessary to more effectively and completely carry out the intentions of this Agreement.

7.10 ENTIRE AGREEMENT. This Agreement represents the entire understanding and agreement between the parties with respect to the subject matter hereof, and supersedes all other negotiations, understandings and representations (if any) made by and between such parties.

IN WITNESS WHEREOF, each of the parties hereto has dully executed this Agreement the day and year first above written.

T/F/ SYSTEMS, INC., a Delaware corporation

By: /S/ RICHARD C. FORD, PRESIDENT
    ------------------------------
    Richard C. Ford, President

T/F/ PURIFINER, INC., a Delaware corporation

By: /S/ RICHARD C. FORD, PRESIDENT
    ------------------------------
    Richard C. Ford, President

STOCK EXCHANGE AGREEMENT
BETWEEN
D.B. FILTERS, INC.,
BYRON LEFEBVRE AND ROBERT MEYER,
AND
T/F PURIFINER, INC.
(WITH EXHIBITS)

This Stock Exchange Agreement (this "Agreement") is made as of the 23rd day of March, 1996, by and between D.B. Filters, Inc., a Florida corporation ("DB"), Mr. Byron Lefebvre, as owner of 80.1% and Robert Meyer, as owner of 19.9% of DB outstanding common stock ("Shareholders"), and T/F Purifiner, Inc., a Delaware corporation ("TFP").

WITNESSETH:

WHEREAS, Shareholders desire to exchange and transfer to TFP and TFP desires to acquire all the outstanding shares, representing 100% of DB according to the terms and conditions herein provided.

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

1. SHARES. Subject to the terms and conditions set forth in this Agreement, Shareholders hereby exchange, transfer, convey and deliver to TFP and TFP hereby acquires from Shareholders, as of the date hereof (the "Closing Date") all of the outstanding shares of DB representing 100% ownership of DB.

1.1 TRANSFER COSTS. TFP hereby agrees to pay all transfer costs and taxes, documentary stamp taxes and amounts, recording costs, and all sales, transfer and license taxes, if any, resulting from the transaction contemplated by this Agreement.

2. PURCHASE PRICE. Buyer agrees to issue to Shareholders .027777% of its Common Stock, which shares will be equivalent to 50,000 shares after TFP completes its stock split in anticipation of a proposed initial public offering through Whale Securities, L.P.

3. DB AND SHAREHOLDERS WARRANTIES AND REPRESENTATIONS. DB and its Shareholders warrant and represent to TFP the following:

3.1 DB is a corporation duly organized, validly existing, and in good standing under the laws of the State of Florida.

3.2 DB is owner of all its Assets and Liabilities (listed on Appendix A) and at the Closing Date shall have good and marketable title to the Assets free and clear of all liens and encumbrances, and

3.3 Shareholders are owners of 100% of the common stock of DB and at the Closing Date shall have good and marketable title to the DB common stock free and clear of all liens and encumbrances.

3.4 DB and Shareholders have full authorization and right to enter into this Agreement and by signing this Agreement are not in breach of the terms of any other agreement or judgment or order of a judicial or administrative agency to or by which DB or Shareholders are or may be bound to any third party.

4. TFP WARRANTIES AND REPRESENTATIONS. TFP warrants and represents to Shareholders the following:

4.1 TFP is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware; and

4.2 TFP has full authorization and right to enter into this Agreement and by signing this Agreement is not in breach of the terms of any other agreement or judgment or order of a judicial or administrative agency to or by which TFP is or may be bound to any third party.

5. INDEMNITY.

5.1 DB and its Shareholders agree to indemnify TFP on demand from and against all other liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs and expenses, including legal expenses, of whatever kind and nature, imposed on, incurred or asserted against TFP, its agents, officers, attorneys, employees, directors, successors and assigns in any way relating to or arising out of the acquisition of DB's common stock or from any misrepresentation by DB or its Shareholders as to the assets, liabilities or equity of DB at the Closing Date of this merger.

6. CLOSING.

6.1 The consummation of the stock exchange contemplated hereby (the "Closing") shall take place at the offices of TFP on the Closing Date, or such other time and place as shall be agreed upon by the parties in writing.

6.2 At Closing, Shareholders shall deliver or cause to be delivered to TFP such share certificates and other good sufficient instruments of conveyance and transfer as shall be effective to vest in TFP all of Shareholders' right, title and interest in and to the Shares.

6.3 Simultaneously, upon the consummation of the exchanges above, Shareholders through its officers, agents and employees, will put TFP into full

possession and enjoyment of the Shares conveyed and transferred under this Agreement.

7. MISCELLANEOUS.

7.1 BINDING EFFECT. All of the terms and provisions of this Agreement shall be binding upon, inure to the benefit of, and be enforceable by the parties and their respective legal representatives, successors and permitted assigns, whether so expressed or not.

7.2 AMENDMENTS. The provisions of this Agreement may not be amended, supplemented, waived or changed orally, but only by a writing signed by the party as to whom enforcement of any such amendment, supplement, waiver or modification is sought and making specific reference to this Agreement.

7.3 SEVERABILITY. If any provision of this Agreement or any other agreement entered into pursuant hereto is contrary to, prohibited by or deemed invalid under applicable law or regulation, such provision shall be inapplicable and deemed omitted to the extent so contrary, prohibited or invalid, but the remainder hereof shall not be invalidated thereby and shall be given full force and effect so far as possible. If any provision of this Agreement may be construed in two or more ways, one of which would render the provision invalid or otherwise voidable or unenforceable and another of which would render the provision valid and enforceable, such provision shall have the meaning which renders it valid and enforceable.

7.4 NOTICES. All notices, requests, consents and other communications required or permitted under this Agreement shall be in writing (including electronic transmission) and shall be (as elected by the person giving such notice) hand delivered by messenger or courier service, electronically transmitted, or mailed (airmail if international) by registered or certified mail (postage prepaid), return receipt requested, addressed to:

If to TFP:                      If to DB or Shareholders:
T/F Purifiner, Inc.             Byron Lefebvre           Robert Meyer
3020 High Ridge Road, Suite 100 DB Filters, Inc.         3020 High Ridge Road
Boynton Beach, Florida 33426    1400 NE 7th Court # 309  Suite 100
Attn: President                 Fort Lauderdale, FL 33334 Boynton Beach, FL 33426

or to such other address as any party may designate by notice complying with the terms of this Section. Each such notice shall be deemed delivered (a) on the date delivered if by personal delivery; (b) on the date of transmission with confirmed answer back if by electronic transmission; and (c) on the date upon which the return receipt is signed or delivery is refused or the notice is designated by the postal authorities as not deliverable, as the case may be, if mailed.

7.5 SURVIVAL. All covenants, agreements, representations and warranties made herein or otherwise made in writing by any party pursuant hereto shall survive the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby.

7.6 HEADINGS. The headings contained in this Agreement are for convenience of reference only, are not to be considered a part of the Agreement and shall not limit or otherwise affect in any way the meaning or interpretation of this Agreement.

7.7 THIRD PARTIES. Unless expressly stated herein to the contrary, nothing in this Agreement, whether expressed or implied, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the parties hereto and their respective legal representatives. successors and permitted assigns. Nothing in this Agreement is intended to relieve or discharge the obligation or liability of any third persons to any party to this Agreement, nor shall any provisions give any third persons any right of subrogation or action over or against any party to this Agreement.

7.8 GOVERNING LAW. This Agreement and all transactions contemplated by this Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Florida.

7.9 FURTHER ASSURANCES. The parties hereby agree from time to time to execute and deliver such further and other transfers, assignments and documents and do all matters and things which may be convenient or necessary to more effectively and completely carry out the intentions of this Agreement.

7.10 ENTIRE AGREEMENT. This Agreement represents the entire understanding and agreement between the parties with respect to the subject matter hereof, and supersedes all other negotiations, understandings and representations (if any) made by and between such parties.

IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement the day and year first above written.

T/F Purifiner, Inc. a Delaware corporation

By:    /S/ RICHARD C. FORD
   ---------------------------------
    Richard C. Ford, President

D.B. Filters, Inc. a Florida corporation

By:    /S/ BYRON LEFEBVRE
   ---------------------------------
     Byron Lefebvre, President


        /S/ BYRON LEFEBVRE
   ---------------------------------
     Byron Lefebvre, Individually


        /S/ ROBERT MEYER
   ---------------------------------
     Robert Meyer, Individually

FIRST AMENDMENT TO STOCK EXCHANGE AGREEMENT

This First Amendment to Stock Exchange Agreement dated as of March 23, 1996 is made as of March 23, 1996 by and among DB Filters, Inc., Mr. Byron Lefebvre and Mr. Robert Meyer and T/F Purifiner, Inc.

WITNESSETH

WHEREAS, the parties are parties to the Stock Exchange Agreement referenced above (the "Stock Exchange Agreement").

NOW, THEREFORE in consideration of the mutual promises and the agreements and covenants contained in this Agreement and for other good and valuable consideration, the receipt and adequacy of which we hereby acknowledge, the parties hereby agree as follows:

1) The "Closing Date" as such term is defined in the Stock Exchange Agreement shall be May 20, 1996, not withstanding anything to the contrary contained in the Stock Exchange Agreement.

IN WITNESS WHEREOF, each of the parties hereto has duly executed this First Amendment as of the date and year first written above.

T/F Purifiner, Inc.

By:    /S/ RICHARD C. FORD
   ------------------------------
   Richard C. Ford
   President

D.B. Filters, Inc.

By:    /S/ BYRON LEFEBVRE
   -----------------------------
   Byron Lefebvre
   President

       /S/ BYRON LEFEBVRE
   -----------------------------
   Byron Lefebvre
   Individually

       /S/ ROBERT MEYER
   -----------------------------
   Robert Meyer
   Individually

Assets:                                   $0

Liabilities, including all contingent
   and unasserted liabilities:            $0

Rights:

100% ownership of the bypass filter royalty rights pursuant to Assignment agreement with T/F Purifiner, Inc., dated April 14, 1994, and 100% ownership interest to the North American filter element manufacturing rights pursuant to Agreement with T/F Purifiner, Inc. and TF Systems, Inc., dated November 26, 1993.

WHEREAS, I Byron Lefebvre, residing in Ft. Lauderdale, Florida

(hereinafter ASSIGNOR), have invented certain new and useful Improvements in a

by-pass oil filter for the purpose of reducing risk of oxidation and

acidification in engine oil and/or method of production and/or use thereof,

disclosed in Exhibit A attached to this Agreement, and any subsequent

improvements therein (hereafter collectively "The Invention"); and

WHEREAS, T/F Purifiner, Inc., a Delaware corporation having a place of

business at 3020 High Ridge Road, Suite 100, Boynton, Florida 33426 (hereinafter

ASSIGNEE), is desirous of acquiring the entire right, title and interest in and

to The Invention and any Letters Patent that may be granted therefor in the

United States and in any and all foreign countries.

NOW, THEREFORE, in consideration of the mutual promises and undertakings

hereinafter contained, and for other good and valuable consideration by each of

the parties hereto to the other given, receipt and sufficiency of which is

hereby mutually acknowledged, it is hereby agreed by and between the parties

hereto as follows:

ASSIGNOR hereby does sell, assign and transfer unto ASSIGNEE, the full and

exclusive right, title and interest in and to The Invention in the United States

and its territorial possessions and in all foreign countries, and the entire

right, title and interest in and to any and all Letters Patent which may be

granted therefor in the United States and its territorial possessions and in any

and all foreign countries, and in and to any and all divisions, reissues,

continuations, continuation-in-parts and extensions thereof, as well as the

right of priority thereto under any international convention to which the United

States is a party.

ASSIGNOR hereby authorizes and requests the Patent and Trademark Office

Officials in the United States and any and all foreign countries to issue any

and all of said Letters Patent, for The Invention, to said ASSIGNEE, as the

assignee of my entire right, title and interest in and to the same, for the sole

use and enjoyment of said ASSIGNEE, its successors and assigns.

Further, ASSIGNOR agrees to communicate to ASSIGNEE, or its appointed

legal representatives, any facts known to ASSIGNOR respecting The Invention, and

testify in any legal proceedings, sign all lawful papers, execute all

divisional, continuation, continuation-in-part, renewal and/or reissue

applications, execute all necessary assignment papers to cause any and all of

said Letters Patent to be issued to said ASSIGNEE, its successors and assigns,

to obtain and enforce proper protection for The Invention in the United States

and in any and all foreign countries, without any additional consideration.

ASSIGNEE agrees to pay ASSIGNOR as consideration for this sale of The

Invention to ASSIGNOR a use-based payment consisting of five percent (5%) of the

direct cost plus 15% of producing units of The Invention. All payments or

reports provided for under this Agreement shall be made by ASSIGNEE to ASSIGNOR

on a quarter-yearly basis beginning on the effective date of this Agreement with

subsequent payments or reports being made on or before the first day of April,

July, October, and January in each year during the term of this Agreement.

ASSIGNEE agrees to furnish on the due date of each quarter-yearly payment or

report specified above, a statement of the previous quarter's direct cost of

producing the certified by ASSIGNEE's chief accounting officer, or any other

officer senior to the chief accounting officer, coupled with any

dollar-use-based payment due.

The use-based payments set forth above will be made until the expiration

(or holding of invalidity or unenforceability) of the last to expire US patent

for The Invention. Also, if within eight years of the filing of an application

for The Invention in the United States no patent has issued for The Invention,

however, then all use-based payments will terminate at that time, regardless of

the existence of any patents in any other countries for The Invention

Since ASSIGNEE has full and exclusive right, title, and interest to The

Invention ASSIGNEE will pay for and be solely in charge of patent applications

for The Invention in the United States and all foreign countries that ASSIGNEE

- -- at its sole option -- decides to pursue. ASSIGNEE will also pay all fees

necessary keep all patents granted for The Invention. Also ASSIGNEE has the sole

option of deciding whether or not to pursue infringers of any patents to issue

for The Invention. If the AssIGNEE does successfully pursue infringers, however,

the ASSIGNEE will pay to the ASSIGNOR ten percent (10%) of any net monetary

recovery (that is the gross monetary recovery minus the cost of proceeding

against the infringer) actually received by ASSIGNEE.

If either party fails to fulfill any obligation under this agreement,

notice will be given by the wronged party of the breach, and if the breach is

not cured within thirty (30) days, the wronged party may take whatever legal

action is available and appropriate to enforce the terms of this agreement or to

collect damages for the breach, however recision is not an available remedy to

either party.

This agreement is to be interpreted in accordance with the laws of the

State of Florida, the Courts (Federal and State) of which have exclusive

jurisdiction over any matter arising under this agreement.

This is the only agreement between the parties with respect to this

matter, and no change can be made to this agreement except in writing and signed

by both parties.

IN WITNESS WHEREOF, the parties hereto have affixed their names and seals,

by themselves or their officers thereunto duly authorized, to be effective on

the day and year first above written. See Schedule A which shall become a part

of this Agreement.

ASSIGNOR:

By:   /S/ BYRON LEFEBVRE
   ----------------------------
      Byron Lefebvre

ASSIGNEE: T/F Purifiner, Inc.

By:   /S/ RICHARD FORD
   ----------------------------
Name:  Richard Ford
Title:  President

AGREEMENT

Whereas, Byron Lefebvre, Robert Meyer and Heather Lefebvre are entitled to receive a 5% royalty (as defined) pursuant to the assignment of a new bypass oil filter patent to T/F Purifiner, Inc., dated April 15, 1994.

Whereas, such parties have agreed to contribute all rights obtained in the above agreement to DB Filters, Inc., a Florida Corporation.

The below signed parties do hereby approve and agree to contribute such rights to DB Filters, Inc. effective as of the date below.

  /S/ ROBERT MEYER           /S/ HEATHER LEFEBVRE       /S/ BYRON LEFEBVRE
- -----------------------    ------------------------   -----------------------
Robert Meyer               Heather Lefebvre           Byron Lefebvre


Dated:  February 15, 1995

AGREEMENT

Whereas, Byron Lefebvre and T/F Purifiner, Inc. and TF Systems, Inc. are the parties to an agreement dated November 26, 1993 related to Byron Lefebvre's ownership of the exclusive rights to manufacture the Purifiner oil filter elements for T/F Purifiner, Inc./TF Systems, Inc. for North America and other rights and obligations.

Whereas, Byron Lefebvre is desirous of contributing all such rights and obligations to DB Filters, Inc., a Florida corporation.

The below signed parties do hereby approve/consent and agree to contribute all such rights and obligations to DB Filters, Inc. as of the date below.

Consented to by:                    Approved and Agreed to by:


  /S/ RICHARD C. FORD                 /S/ BYRON LEFEBVRE
- -------------------------------     ---------------------------------------
Richard C. Ford, President          Byron Lefebvre, as President of
T/F Purifiner, Inc.                 DB Filters, Inc. and Individually
TF Systems, Inc.


Dated:  February 15, 1995

JOINT VENTURE AGREEMENT
BETWEEN
T/F PURIFINER, INC.,
T/F SYSTEMS, INC.,
CENTRAX LIMITED,
THE BARR FAMILY
AND
A.N. DAVIES

Joint Venture Agreement

(1) TF Purifiner, Inc.

(2) TF Systems, Inc.

(3) Centrax Limited

(4) The Barr Family

(5) A.N. Davies

THIS AGREEMENT is made this eighteenth day of December 1995 and is between:

(1) TF PURIFINER, INC. ("TF Inc."), a Delaware Corporation of 3020 High Ridge Road, Suite 100, Boynton Beach, Florida 33426, United States of America.

(2) TF SYSTEMS, INC. ("TFS"), a Delaware Corporation of 3020 High Ridge Road, Suite 100, Boynton Beach, Florida 33426, United States of America.

(3) CENTRAX LIMITED ("Centrax") whose registered office is at Swift House, 12A Upper Berkeley Street, London, WlH 7PE.

(4) MR. R. H. H. BARR on his own behalf and on behalf of Mr. C. R. Barr and Mr. R. A. Barr c/o Centrax Ltd, Shaldon Road, Newton Abbot, Devon, TQ12 4SQ ("The Barr family").

(5) A.N. DAVIES ("AND") of Caseley Close, Lustleigh, Devon, TQ13 9TN

WHEREAS:

(a) TF Inc. and TFS are in the business of designing, developing, manufacturing and marketing mobile bypass oil refining units and filters under the trademark "Purifiner" (hereinafter referred to as the "Products").

(b) TF Inc. is the exclusive licensee of the US patent Nos. 4,189,351; 4,227,969; 4,289,583; 4,943,352 and pending patent applications and (TF Inc.) is the registered proprietor of the registered trademarks in the Territory set out in the Appendix 4 the ("Mark").

(c) TF Inc. and TFS are the owners of the Rights as defined in Clause 2.

CLAUSE 1.      FORMATION OF JOINT VENTURE:

      1.1      The parties hereby agree to establish a new Joint Venture Company
               having the name TF Purifiner  (Europe)  Limited ("TF Ltd") and TF
               Inc.  agrees to make such name  available  for use by TF Ltd with
               it's Articles of Association in the form annexed as Appendix 3 or
               such  other  form of  Articles  as TF Ltd may  from  time to time
               resolve.

      1.2      The business of TF Ltd shall be the exploitation of the Rights in
               the Territories or such other  activities as TF Ltd may from time
               to time resolve.

CLAUSE 2.      RIGHTS:


      2.1      TF Inc. and TFS jointly and severally warrant to  Centrax, to the
               Barr  family  and to AND that they have all  necessary  rights to
               make  possess  market or  dispose of in any way  whatever  and to
               import  to  and  to  commercially  exploit  the  Products  in the
               Territories  referred to in Clause 14 ("the Territory")  together
               with the right to offer to do any of the foregoing  together with
               the right to use the Mark ("the  Rights")  and that they have the
               right to assign to Ltd the Rights contained in Clause 2.2.

      2.2      By and subject  to the terms of this Agreement, TF Ltd  is hereby
               assigned by TFS and TF Inc. the irrevocable and exclusive  rights
               to  exploit  the  Rights  free of charge in respect of all of the
               Products of TF Inc. and TFS (as now existing and developed in the
               future) in perpetuity  except for royalty  payments as defined in
               10.2.

      2.3      For  the  avoidance  of  doubt,  TF  Inc. and/or TFS shall not be
               entitled to exercise  their Rights,  in the Territory  covered by
               this Agreement, unless TF Ltd otherwise agrees.

CLAUSE 3.      APPROVAL OF MEMBERS:

               The provisions of this Agreement are  conditional on and will not
               take effect until the terms of this  Agreement are approved by an
               ordinary  resolution  of the Board  members of TF Inc. and TFS in
               general  meeting and TF Inc. and TFS shall use best  endeavors to
               procure this as expeditiously as possible and, once obtained, the
               provision hereof will apply and in the event that approval is not
               obtained  by 1st  January  1996  this  Agreement  shall  be of no
               further force or effect.

CLAUSE 4.      SHARE STRUCTURE:

               The shareholding in TF Ltd shall be structured as follows:

               (1)    There shall be an  authorized  and issued share capital of
                      55,000 shares,  value (pound)1 sterling each to be paid up
                      by  Centrax  to be issued in three  classes  carrying  the

rights set out in the Articles of Association as follows:

                       25,000   'A'  shares  to  Centrax,  the  Barr Family or a
                                company representing the Barr family (voting)
                       25,000   'B' shares to be held by TF Inc.(voting)
                        5,000   'C' shares to AND (non-voting)

                      For a  shareholder  which  is a  corporation,  it shall be
                      permitted  for any class of share to be  registered in the
                      name of an individual  provided that such individual holds
                      the  shares as nominee of the  shareholder  concerned  and
                      written  evidence  acceptable to the Board of Directors is
                      produced demonstrating that appointment.

CLAUSE 5.      FUNDING:

      5.1      If additional financing in excess of the original paid up capital
               of(pound)55,000  is  needed  such  additional  financing  can  be
               provided  either  by  bank  borrowing  by TF Ltd or  directly  or
               indirectly   by  Centrax   or  the  Barr   family  or  a  company
               representing  the Barr  family  either as capital,  non  interest
               bearing loans or interest  bearing loans as determined and agreed
               by the voting  Directors  of the TF Ltd Board and the Centrax Ltd
               Board for commercially sound reasons.

      5.2      Subject  to  Clause  5.1,  Centrax  or  the  Barr family agree to
               support and fund  present and future TF Ltd  operations  until TF
               Ltd is self-funding.  "Self Funding" shall mean a situation where
               TF Ltd is trading without  indebtedness to Centrax, or with other
               financial  support,  security or guarantee provided by Centrax or
               the Barr family.  It is the  intention of the parties that TF Ltd
               should become self funding as soon as practicable.

CLAUSE 6.      DURATION:

      6.1      In the event  that:- TF Inc. or TFS cease to trade or enters into
               liquidation  then the  Rights  assigned  under  Clause  2.2 shall
               continue as the property of TF Ltd including the ownership of all
               patents,   copyright,  design  and  trademarks  relevant  to  the
               Territory.

      6.2      In  the  case  of  TF  Ltd liquidation or closure the Rights will
               revert to TF Inc. and TFS.

CLAUSE 7.      OWNERSHIP:

      7.1      If Centrax  ceases  to trade or if the Barr family  transfers the
               whole of their  shares in  Centrax  (more  than 50%) as part of a
               disposal of  Centrax's  undertaking,  it is agreed by the parties
               that those members of the Barr family, or a company  representing
               the Barr family,  who have signed Appendix 6, shall purchase from
               Centrax it's  shareholding  in TF Ltd and take an assignment  and
               novation  of  Centrax's   rights  and   obligations   under  this
               Agreement.  Thereafter,  if any  member  of the Barr  family or a
               company representing the Barr family wish to sell their shares in
               TF Ltd it will be in accordance with the Articles of Association.

      7.2      In  the  event  that  the  Ford family's holding in TF Inc. falls
               below 50% of the voting shares in TF Inc. for whatever reason AND
               the Ford family loses executive  control of the Board of TF Inc.,
               then the 'A'  shareholders  will have the right to appoint  three
               voting  Directors  in  respect  of the  'A'  shares  and  the 'B'
               shareholders  will  have the  right to  appoint  two  voting  'B'
               Directors.

CLAUSE 8.      DIVIDEND POLICY:

               Dividend  Policy will be at the  discretion  of the Directors but
               with a minimum  payment of 30% of post tax profit after deducting
               losses in prior years.

CLAUSE 9.      INTELLECTUAL PROPERTY:

               Such continued patent  copyright design and trademark  protection
               incurred  since May 24,  1995 and agreed by the  parties  for all
               current  and future  Products in the  Territories  (as defined in
               Appendix  1) will be paid for by TF Ltd.  All such  rights in the
               Territory  will be assigned to TF Ltd in  perpetuity  on the same
               basis as in Clause 2.2.

CLAUSE 10.     TECHNICAL DEVELOPMENTS:

      10.1     The  intellectual  property  rights  to  any  improvements to the
               Products  produced by TF Ltd shall be the  property of TF Ltd. TF
               Ltd agrees that the irrevocable  exclusive  rights to manufacture
               and  market  such  improvements  outside  the  Territory  will ~e
               assigned  back to TF Inc. on a similar  royalty free basis to the
               assignment  granted  herein save that TF Ltd gives no warranty as
               to it's ability to grant such rights or that the  exploitation of
               the same will not infringe the rights

of third parties save for a warranty that it has not licensed any third party to exploit the same.

10.2 The rights of all present or future developed designs or improve- ments or replacement for Products produced by TF Inc. or TFS shall be conferred to TF Ltd. on the same basis as set out herein save that in respect of the present royalty agreement that TF Inc. has in respect to filter elements with Byron Lefebvre and royalty payments to Robert " Malt, TF Ltd agrees not to act in any manner to cause TF Inc. to breach those agreements.

CLAUSE 11.     INDEMNITY:

               TF Inc. and TFS hereby  indemnify TF Ltd against all and any loss
               costs claim or demand in relation to the use of the Rights and in
               relation to any claims  regarding the  manufacturing or marketing
               or  intellectual  property in the Products in the Territory  that
               may be made by any third party.

CLAUSE 12.     ADMINISTRATION OF TF LTD:

               Will be initially as listed hereunder subject to change from time
               to time as approved by the Board of TF Ltd.

               The auditors shall be:- KPMG,  Linacre House,  Southernhay  East,
               Exeter,  Devon, England The bankers shall be:- Barclays Bank PLC,
               40 Courtenay Street,  Newton Abbot, Devon, England The solicitors
               shall be:- Messrs Bevan Ashford, Curzon House,  Southernhay West,
               Exeter,  Devon, EX4 3LY, England The Registered Office shall be:-
               C/O Messrs Bevan Ashford, Curzon House, Southernhay West, Exeter,
               Devon,  EX4 3LY,  England The Company  Secretary shall be:- To be
               appointed

               The  Accounting  Reference  Date  shall be:-  December  31st 1996
               Secretarial  and personnel  services shall be provided by TF Ltd.
               The following shall be the Directors of TF Ltd.

Richard Henry Howard Barr Richard Charles Ford Charles Robert Barr Lawrence Arnold Freedman Albert Neal Davies

Unless otherwise determined by the Board, the business premises of TF Ltd shall be located at:- C/O Centrax, Shaldon Road, Newton Abbot, Devon, TQ12 4SQ, England

CLAUSE 13.     MANUFACTURE OF THE PRODUCTS:

      13.1     The  manufacture  of the Products will commence in the Territory,
               through  TF  Ltd  as  soon  as  the  Board  of  TF  Ltd  deem  it
               appropriate.  All design detail drawings and production processes
               will be  passed to TF Ltd on the  signing  of this  Agreement  to
               allow  production  to proceed in the  Territory  as  appropriate.
               Until  such time as the  manufacture  of the  Products  by TF Ltd
               occurs in the Territory, TF Inc. will supply the Products against
               an agreed schedule and price structure as stated in Appendix 2.

      13.2     On  signing  of this  Agreement,  TF Ltd shall  have the right to
               purchase individual items direct from the established US sourcing
               which TF Inc.  and TFS will  make  available  to TF Ltd as TF Ltd
               deems  desirable  and shall have the right to use TF Inc. and TFS
               existing tooling associated thereto on a no charge basis.

      13.3     On this Agreement coming into effect by the  passing of the reso-
               lutions required by Clause 3, the terms of payment requiring 100%
               of the  purchase  price of the units,  as  defined in  Appendix 2
               attached,  purchased  from TF Inc.,  to be paid by wire  transfer
               upon the placing of orders, will become valid providing that this
               amount will at no time exceed the outstanding balance of $100,000
               of unfilled orders and until such time as production commences in
               the Territory or an alternative source of supply is agreed.

CLAUSE 14.     THE TERRITORY:

               The Territory covered by the Agreement is specified in Appendix I
               attached.

CLAUSE 15.     SUPPORT SERVICES:

               TF  Inc.  and  TFS  undertake  to  fully  support  TF  Ltd in all
               technical and  commercial  matters.  When TF Ltd requests a visit
               from TF Inc. or TFS personnel to it's Territory,  TF Ltd will pay
               such personnel's reasonable out of pocket expenses.

CLAUSE 16.     COSTS:

      16.1     Subject to Clause 16.2, the parties shall bear their own costs of
               and incidental to the preparation,  execution and  implementation
               of this Agreement.

      16.2     Centrax  will  be entitled to charge TF Ltd all  reasonable costs
               and expenses  incurred arising by virtue of Centrax's  investment
               and  expenditure  in setting up an outlet for the Products in the
               Territory and in particular  those items or heads of cost set out
               in  Appendix  5 but  credit  being  given for  revenue  received.
               Reasonable  costs to be approved by the Board of  Directors of TF
               Ltd.

CLAUSE 17.     CONFIDENTIALITY AND RESTRICTED INFORMATION:

               Each  Director of each of the parties  hereto and of TF Ltd shall
               be entitled,  whilst he holds office,  to make full disclosure to
               any shareholder  appointing him of any information relating to TF
               Ltd which that Director may acquire,  but the shareholder and the
               Director  receiving such  information  shall, for the duration of
               the  Agreement  and for one  year  thereafter,  keep  the same in
               strict confidence unless otherwise agreed.


CLAUSE 18.     DUTY OF ACTION:

               Each party shall, from time to time, do all such acts and execute
               all such  documents  as may  reasonably  be necessary in order to
               give effect to the provisions of this Agreement.

CLAUSE 19.     NOTICES AND SERVICE:

               Any notice or other information required or authorized under this
               Agreement  shall be given by hand,  telex,  cable,  facsimile  or
               prepaid  registered  first class post (or datapost in the case of
               notices on any party  outside the UK) to the relevant  parties at
               the address of the registered or principal office of the relevant
               party (or to any such  address  as may be given by that  party in
               writing from time to time).

               Service  shall be deemed to have  occurred and been  effected two
               working days after the date of sending.

CLAUSE 20.     ANNOUNCEMENTS:

               Except  as  required  by  law  or  the  requirements of any stock
               exchange,  no party  shall make any press or public announcements

concerning any aspect of this Agreement without first obtaining the agreement of the other parties to the text of that announcement.

CLAUSE 21.     NATURE OF AGREEMENT:

               Nothing in this  Agreement  shall create or be deemed to create a
               partnership  or the  relationship  of principal and agent between
               the parties or any of them.  This  Agreement  contains the entire
               Agreement between the parties with respect to it's subject matter
               and may not be modified except by an instrument in writing signed
               by the duly authorized representatives of the party.

               If any provision of this  Agreement is held by any court or other
               competent authority to be invalid or unenforceable in whole or in
               part,  this Agreement shall continue to be valid as to it's other
               provisions and the remainder of the effected provision.

               No failure or delay by any part in exercising  any of it's rights
               under this  Agreement  shall be deemed to be a waiver thereof and
               no waiver of a breach of any provision of this Agreement shall be
               deemed to be a waiver of any subsequent breach of the same of any
               other provision.


CLAUSE 22.     ARBITRATION:

               Any dispute between the parties arising from this Agreement shall
               be  referred  to  and   determined  by   arbitration   under  the
               International   Arbitration   Rules  of  the   London   Court  of
               International Arbitration.

               This Clause shall not preclude  the making of an  application  to
               the Court for injunctive relief.


CLAUSE 23.     JURISDICTION:

               This  Agreement  shall be governed by and construed in accordance
               with the Laws of England.

               The  parties   hereby  agree  to  submit  to  the   non-exclusive
               jurisdiction of the English Courts.

CLAUSE 24.     BINDING NATURE:

               The benefit and burden of this Agreement  shall be binding on any
               permitted transferee of the shares in TF Ltd.

CLAUSE 25.     BREACH OF AGREEMENT:

               If any of the  parties  hereto  fails to fulfill  any  obligation
               hereunder any injured party may give written notice of the breach
               to the defaulting  party and if the breach is not remedied within
               30 days the  injured  party  may take  whatever  legal  action is
               available to enforce the terms of this  Agreement  and to recover
               damages for breach provided always that rescission or termination
               shall not be a remedy available to any party. The election of any
               one  or  more  remedy  by any of the  parties  hereto  shall  not
               constitute  a waiver by such  party of the  right to  pursue  any
               other available remedy.


CLAUSE 26.     ARTICLES OF ASSOCIATION

               In the event of  conflict  the terms of Clause  7.2  hereof  will
               prevail over those of the Articles of Association.

AS WITNESS whereof the parties have signed this Agreement the day and year first before hand

SIGNED BY: RICHARD C. FORD                            )
         ------------------------------
          /s/conformed                                )
for and on behalf of TF Purifiner, Inc.               )
in the presence of:


SIGNED BY: RICHARD C. FORD                            )
         ------------------------------
          /s/conformed                                )
for and on behalf of TF Systems, Inc.                 )
in the presence of:


SIGNED BY: RICHARD ANTHONY BARR                       )
for and on behalf of Centrax Limited                  )
in the presence of:                                   )

SIGNED BY: RICHARD HENRY HOWARD BARR                  )
for and on behalf of Barr family                      )
in the presence of:                                   )


SIGNED BY: ALBERT NEAL DAVIES                         )
in the presence of:                                   )

E.E.C. COUNTRIES            E.F.T.A COUNTRIES           SOVIET UNION
- ----------------            -----------------           ------------
                                                           (former)
Belgium                     Austria                     Comprising:-
Denmark                     Finland                     Armenia
France                      Iceland                     Belarus
Germany                     Norway                      Estonia
Greece                      Sweden                      Georgia
Irish Republic              Switzerland                 Kazakhstan
Italy                                                   Kyrgyzstan
Luxembourg                                              Latvia
Netherlands                                             Lithuania
Portugal                                                Moldova
Spain                                                   Russia
United Kingdom                                          Tajikistan
                                                        Ukraine
                                                        Uzbekistan


EASTERN EUROPEAN            MIDDLE EAST                 YUGOSLAVIA
- ----------------            -----------                 ----------
                                                         (former)
Albania                     Arab Emirates               Comprising:-
Bulgaria                    Bahrain                     Bosnia
Cyprus                      Iran                        Croatia
Czech Republic              Iraq                        Herzegovina
Gibraltar                   Israel                      Macedonia
Hungary                     Jordan                      Serbia
Malta                       Kuwait                      Slovenia
Poland                      Lebanon
Romania                     Oman
Slovakia                    Qatar
Turkey                      Saudi Arabia
                            Syria
                            Yemen

                                        Appendix 2
             TF PURIFINER, INC. 1995/1996 PRICES TO TF PURIFINER (EUROPE) LTD
             ----------------------------------------------------------------


                                                                                                   Batch
UNITS                            TF-8       TF-12       TF-24      TF-40       TF-60    TF-240    Refiner
- -----                            ----       -----       -----      -----       -----    ------    -------
Suggested W/D
Selling Price                   $134        $278        $308        $359      $384       $539     $3,521

Cost TF (RM, Labour
and Malt Royalty)                $58.30      $96.05     $109        $124.10   $129.45    $148.85  $1,250.30

Current J.V. Cost/Unit           $86        $141        $160        $182      $189       $217     $1,826

FILTERS (PER CASE)
- ------------------

Current W/D Selling Price        $97         $87         $53         $74       $85       $119

Cost TF (RM, Labour and
Malt Royalty)                    $57.65      $21.32      $13.20      $17.26    $22.33     $27.41

J.V. Cost/Case                   $65.15      $31.80      $19.70      $25.75    $33.35     $40.90

Filter Royalty (5.75%)
plus*                             $3.99       $2.63       $2.00       $2.40     $2.86      $3.31

J.V. Cost/Case                   $69.14      $34.43      $21.70      $28.15    $36.21     $44.21

*   Additional cost for changes to filter for increased  cotton ($.50,  improved
    felt pads ($.20) and additive  cost (for $.48 case to $.96 case)  Subject to
    normal  future price  increases  related to  inflation  and  supported  cost
    increases

Draft 11 December 1995:

The Companies Act 1985 - 1989

COMPANY LIMITED BY SHARES

ARTICLES OF ASSOCIATION

OF

T.F. PURIFINER (EUROPE) LIMITED

(adopted by Special Resolution passed on [_______________] 199___)

PRELIMINARY

1. The regulations contained in Table A in the Companies (Tables A to F) Regulations 1985 (as amended so as to affect companies first registered on the date of the adoption of these Articles) shall, except as hereinafter provided and so far as not excluded by or inconsistent with the provisions of these Articles, apply to the Company to the exclusion of all other regulations or Articles of Association. References herein to regulations in the said Table A unless otherwise stated.

SHARE CAPITAL

2. The share capital of the Company at the date of the adoption of these Articles is(pound)55,000 divided in 25,000 'A' Shares of (pound)1 each and 5,000 'C' Shares of(pound)1 each. In the event that any 'A' Shares are transferred to a holder of 'B' Shares they shall automatically become denominated as 'B' Shares as the case may be and vice versa. The said 'A' 'B' and 'C' shares shall carry the respective voting rights and rights to appoint and remove Directors and be subject to the restrictions on transfer hereinafter provided, but in all other respects shall be identical and rank pari passu in all respects.

ISSUE OF SHARES

3. Subject to Section 80 of the Companies Act 1985, all unissued shares shall be at the disposal of the Directors and Section 89(1) of the Companies Act 1985 shall not apply.

TRANSFER OF SHARES

4.1 Subject to the provisions of Regulation 24 any shares may at any time be transferred:-

(a) by any individual member to the spouse mother father sister brother child or grandchild "privileged relation" of such member; or

(b) by any such individual member to trustees to be held upon trust for such member and/or any privileged relation of such member
("the family trusts")

(c) by any member being a company to a member of the same group of companies as the transferor company;

(d) by any person entitled to shares in consequence of the death or bankruptcy of an individual member to any person or trustee to whom such individual member, if not dead or bankrupt, would be permitted hereunder to transfer the same; or

4.2 If a person to whom shares have been transferred pursuant to Article 4.1(b) shall cease to be a privileged relation or trustee, such person shall be bound, if and when required in writing by the Directors so to do, to give a transfer notice in respect of the shares concerned

4.3 If a transferee company ceases to be a member of the same group as the transferor company from which (whether directly or by a series of transfers under Article 4.1 shares derived) it shall be the duty of the transferee company to notify the Directors of the Company in writing that such event has occurred and the transferee company shall be bound, if and when required in writing by the Directors so to do, to give a transfer notice in respect of those Shares

4.4 Except as provided in paragraphs 4.1 to 4.3 no share in the Company shall be transferred by any member or other person entitled to transfer the same otherwise than in accordance with the following provisions:-

(a) Any member or other person proposing to transfer any share (hereinafter referred to as "the proposing transferor") shall

give notice in writing
(hereinafter called "the transfer notice") to the Company that he desires to transfer the same. A transfer notice shall, on receipt by the Company, constitute the Company the agent of the proposing transferor for the sale to any member of the Company or any person approved by the Directors as eligible to be a member of the Company of the shares referred to therein at the fair value to be determined in accordance with sub Article (b) hereof. A transfer notice shall not be revocable except with the sanction of the Directors

(b) The fair value of the shares included in a transfer notice shall be determined within 30 clear days of the transfer notice by the Auditor for the time being of the Company who shall at the request and expense of the Company certify in writing the sum which in his opinion is the fair value of the shares included int he transfer notice as at the date of the transfer notice. In certifying the fair value of the shares the Auditor shall be considered to be acting as an expert and not as an arbitrator and accordingly any provisions of law or statute relating to arbitration shall not apply

(c) Within 10 clear days of the receipt of the Auditor's certificate any share included in any transfer notice shall in the first place be offered at the fair value by written notice (hereinafter called "the offer notice") to the other shareholders pro-rata amongst those other Shareholders their respective shareholdings. The offer notice shall specify the date of receipt by the Company of the transfer notice and the fair value of the shares as certified by the Auditor and shall invite the offeree to accept all or any of the shares so offered. The offer notice shall further limit the time in which the offer may be accepted (being not more than twenty clear days from the date of the offer notice) and if any person does not before expiry of such limit accept by notice in writing any share offered to him the offer in respect of any such share shall lapse

(d) In the event any share comprised in the offer notice is not agreed to be purchased within the time for acceptance of the offer contained in the offer notice any share not so taken by the offeree named in the offer notice shall forthwith be offered by notice in writing at the fair value (hereinafter called "the option notice") to the members (other than the proposing transferor or to

the member who did not accept the offer notice) as nearly as maybe in proportion to the shares held by them respectively. The option notice shall limit the time in which the offer may be accepted (being not more than 10 clear days from the date of the option notice) and if any member does not before expiry of such limit claim by notice in writing any share offered to him it shall be applied in accordance with sub Article (e) below. The Directors shall apply any share representing fractional entitlements in such manner as they shall think fit

(e) If any share comprised in the option notice is not agreed to be purchased the member serving the transfer notice may forthwith offer any such share at not less than the fair value to any other person

(f) The Directors may refuse to register a transfer of a share under this Article 4.4 if the transferee is not an existing member of the Company.

(g) The provisions of this Article 4.4 shall not apply if all of the 'A' Members and 'B' Members of the Company consent in writing

PROCEEDING AT GENERAL MEETINGS

5. Unless agreed by the holders of a majority of the issued 'A' Shares and 'B' Shares all general meetings of the Company shall be held in the UK.

6. The quorum at any General Meeting shall be two or more members present in person or by proxy including one person being or representing a holder of any of the 'A' Shares and one person being or representing a holder of any of the 'B' Shares provided that if within thirty minutes of the time appointed for the meeting such quorum is not present such meeting shall be adjourned in accordance with Regulation 41. Regulation 40 shall be modified accordingly.

7. Subject to the provisions of the Act a resolution in writing signed by all the members for the time being entitled to receive notice of and attend and vote at General Meetings of the Company shall be as effective as if the same had been passed at a General Meeting of the Company duly convened and held and may consist of several documents signed by one or more persons. In the case of a corporation a resolution in writing may be signed on its behalf by a Director or the Secretary thereof or by its duly appointed attorney or duly authorised representative. Regulation 53 shall be extended accordingly.

VOTE OF MEMBERS

8. On a show of hands every member who is the holder of 'A' Shares or the holder of 'B' Shares present in person shall have one vote, and on a poll every member who is the holder of 'A' Shares or the holder of 'B' Shares present in person or by proxy shall have one vote for every share of which he is the holder. Any Shareholder being the holder of 'C' Shares shall have no right to vote in respect of those 'C' Shares whether on a show of hands or on a poll. Regulation 54 shall not apply.

9. An instrument appointing a proxy (and, where it is signed on behalf of the appointor by an attorney, the letter or power of attorney or a duly certified copy thereof) must either be delivered at such place or one of such places (if any) as may be specified for that purpose in or by way of note to the notice convening the meeting (or, if no place is so specified, at the registered office) at least one hour before the time appointed for holding the meeting or adjourned meeting or (in the case of a poll taken otherwise than at or on the same day as the meeting or adjourned meeting) for the taking of the poll at which it is to be used or be delivered to the Secretary (or the chairman of the meeting) on the day and at the place of, but in any event before the time appointed for holding, the meeting or adjourned meeting or poll. An instrument of proxy shall not be treated as valid until such delivery shall have been effected. Regulation 62 shall not apply.

NUMBER OF DIRECTORS

10. The maximum number of Directors shall be five and shall consist of two persons who shall be designated as 'A' Directors (and shall be deemed to have been appointed under Article 12 by the holders of the 'A' Shares) and two persons who shall be designated at 'B' Directors (and shall be deemed to have been appointed under Article 12 by the holders of the 'B' Shares) and one person who shall be designated as the 'C' Director (and shall be deemed to have been appointed under Article 12 by the holders of the 'C' Shares). Regulation 64 shall not apply.

ALTERNATE DIRECTORS

11. The holders of a majority of any one class of shares may at any time appoint any person (including another Director) to be the alternate Director of any Director of the relevant class and may at any time terminate such appointment. Any such appointment or termination of appointment shall be effected in like manner as provided in Article 14 hereof. The same person may be appointed as the alternate Director of

         more than one Director.  Regulations 65 to 68 shall not apply.

11.1     The  appointment  of an  alternate  Director  shall  determine  on  the
         happening  of any event which if he were a Director  would cause him to
         vacate  such  office  or if the  Director  of whom he is the  alternate
         ceases to be a Director.

11.2     An  alternate  Director  shall be  entitled  to receive  notices of all
         meetings of the Directors  and of all  committees of Directors of which
         the Director of whom he is the alternate is a member to attend and vote
         and be counted in the quorum at any such  meeting at which the Director
         of whom he is the alternate is not personally  present and generally to
         perform all the  functions of the Director of whom he is the  alternate
         in his absence and the  provisions of these  Articles shall apply as if
         he were a  Director  of the  relevant  class.  If he shall be himself a
         Director or shall attend any such meeting as an alternate for more than
         one Director his voting rights shall be cumulative.

                      APPOINTMENT AND REMOVAL OF DIRECTORS

12.      The  holders  of  a  majority  of  the 'A' Shares may from time to time
         appoint  up to two  persons  to be  Directors,  and  the  holders  of a
         majority  of the 'B'  Shares  may from time to time  appoint  up to two
         persons to be  Directors  and the  holders of the  majority  of the 'C'
         Shares  may from time to time  appoint  one  person to be a  non-voting
         Director.  In these  Articles  the  expressions  'A'  Director  and 'B'
         Director and 'C' Director respectively designate Directors according to
         the class of shares  holders of a majority of which have  appointed  or
         are deemed to have appointed  them. The Directors  shall not be subject
         to retirement by rotation. Regulations 73 to 80 shall not apply.

13.      The  office  of a  Director  shall  be  vacated  in any  of the  events
         specified in  Regulation 81 and also if he shall be removed from office
         by the holders of a majority of the relevant class of shares.

14.      Any  such  appointment  or  removal by the holders of a majority of the
         relevant  class of shares shall be in writing served on the Company and
         signed by the  holders  of a  majority  of the issued 'A' Shares or 'B'
         Shares or 'C' Shares (as the case may be). In the case of a corporation
         such  documents  may be  signed  on its  behalf  by a  Director  or the
         Secretary thereof or by its duly appointed attorney or duly authorised
         representative.

PROCEEDINGS OF DIRECTORS

15. The 'A' Directors and the 'B' Directors and the 'C' Director shall be entitled to receive notice in accordance with these Articles and to attend meetings of the Board of Directors. Only the 'A' Directors and the 'B' Directors will be entitled to vote on resolutions of the Board of Directors and otherwise conduct the business affairs of the Company and the 'C' Director shall have no such rights as aforesaid.

16. Unless otherwise agreed by a majority for the time being of the 'A' Directors and of the 'B' Directors Board Meetings shall be held no less than two times in every year and twenty-one days' notice shall be given to each of the Directors of all meetings of the Board, at the address (within or outside the United Kingdom) notified from time to time by each Director to the Secretary of the Company and all such meetings (unless otherwise agreed) shall be held in the United Kingdom. Each such notice shall contain, inter alia, an agenda specifying in reasonable detail the matters to be discussed at the relevant meeting, shall be accompanied by all relevant papers for discussion at such meeting and, if sent to an address outside the United Kingdom, shall be sent by courier or by telefax.

17. A quorum at a meeting of Directors shall be two of which one shall be an 'A' Director and one a 'B' Director, provided that if within thirty minutes of the time appointed for the holding of any meeting of the Directors either an 'A' Director or a 'B' Director shall not be present the Directors present shall resolve to adjourn that meeting to a specified place and time (which shall not be earlier than three nor later than seven days after the date originally fixed for the meeting). An alternate Director shall be counted in the quorum in the same capacity as his appointor but so that not less than two individuals will constitute the quorum. Regulation 89 shall not apply.

18. No Director shall be appointed otherwise than as provided in these Articles. Regulation 90 shall be modified accordingly.

19. Unless the parties otherwise agree there shall be no chairman of the Board. If a chairman is appointed the person appointed shall not have a casting vote.

20. All business arising at any meeting of the Directors or of any committee of the Directors shall be determined only by resolution provided that if at any quorate meeting an 'A' Director is not present in person or represented by an alternate the votes of the 'A' Directors present in person represented by an alternate director shall be pro tanto increased so that such 'A' Directors shall be entitled to cast

the same aggregate number of votes as would be cast by all 'A' Directors if they were all present this proviso also applying to the 'B' Directors mutatis mutandis.

21. On any matter in which a Director is in any way interested provided that he declares his interest in the manner provided by Section 317 of the Act he may nevertheless vote and be taken into account for the purposes of a quorum and (save as otherwise agreed) may retain for his own absolute use and benefit all profits and advantages directly or indirectly accruing to him thereunder or in consequence thereof. Regulations 94 and 98 shall be modified accordingly.

22. A resolution determined on without any meeting of the Directors and evidenced by writing signed by all the Directors entitled to vote shall be valid and effective for all purposes as a resolution of the Directors passed at a meeting duly convened, held and constituted and the resolution may be contained in several documents in like form each signed by one or more Directors. Regulation 93 of Table A shall not apply.

23. Any director enabled to participate in the proceedings of a meeting by means of a telephone or other communication device which allows all the other Directors present at such meetings whether in person or by means of such communication device, to hear at all times such Director and such Director to hear at all times all other Directors present at such meeting (whether in person or by means of such type of communication device) shall be deemed to be present at such meeting and shall be counted when reckoning a quorum.

INDEMNITY

24. Subject to the provisions of and so far as may be permitted by law, every Director, Auditor, Secretary or other officer of the Company shall be entitled to be indemnified by the Company against all costs, charges, losses, expenses and liabilities incurred by him in the execution and discharge of his duties or in relation thereto including any liability incurred by him in defending any proceedings, civil or criminal, which relate to anything done or omitted or alleged to have been done or omitted by him as an officer or employee of the Company and in which judgment is given in his favour (or the proceedings are otherwise disposed of without any finding or admissions of any material breach of duty on his part) or in which he is acquitted or in connection with any application under any statute for relief from liability in respect of any such act or omission in which relief is granted to him by the Court. Regulation 118 shall not apply.

DIRECTORS' LIABILITY INSURANCE

25. Without prejudice to any other provision of these Articles the directors may purchase and maintain insurance for or for the benefit of any persons who are or were at any time directors, officers or employees of the Company, or of any company which is a subsidiary or subsidiary undertaking of the Company, or of any other company in which the Company has any interest whether direct or indirect or which is in any way allied to or associated with the Company or any such subsidiary, or of any of the predecessors in business of the Company or any such other company as aforesaid, or who are or were at any time trustees of any pension fund in which any employees of the Company or of any such predecessor or other company or subsidiary undertaking as aforesaid are or have been interested. Including (without prejudice to the generality of the foregoing) insurance against any liability incurred by such persons in respect of any act or omission in the actual or purported execution and/or discharge of their duties and/or in exercise or purported exercise of their powers and/or otherwise in relation to their duties, powers, or offices in relation to the Company or any such predecessor or other company or subsidiary undertaking as aforesaid or any such pension fund. No director or former director shall be accountable to the Company or its members for any benefit provided pursuant to this Article 21 and the receipt of any such benefit shall not disqualify any person from being or becoming a director of the Company.

26.1     In the first sentence of Regulation 101 of Table A, the words "Any seal
         adopted by the Company" shall be substituted for the words "The Seal".

26.2     Every share  certificate  shall be sealed with the seal (if any) of the
         Company  or may be signed by a  director  and the  secretary  or by two
         directors,  and the second sentence of Regulation 6 of Table A shall be
         amended accordingly.

                                  APPENDIX FOUR

                                TRADEMARK DETAILS

                       REGISTERED/FILED       APPLICATION NO.   REGISTRATION NO.
                       ----------------       ---------------   ----------------

Benelux                    1/4/94             798438                532234
CIS (Russia                2/10/94            157571                115666
Czechoslovakia             3/10/95
Denmark                    7/22/94            03666/1993            04816/1994
Finland                    9/5/94             2521/93               133965
France                     6/8/93             93/471240
Germany                    10/15/91           T31320/7WZ            2005055
Hungary                    6/10/93            135039                M9202203
Italy                      6/11/93            93C001089
Macedonia                  10/95
Norway                     6/8/93             932711
Poland                     4/15/94            108799                75,922
Portugal                   6/16/93            292580
Spain                      6/10/93            1766608
Sweden                     3/31/94            93-5373               256993
Switzerland                6/18/93            8276/1993             413956
United Kingdom             1/5/91             1451914               1451914

LEASE AGREEMENT
BETWEEN
PAPEYCO TRADING INTERNATIONAL, INC.
AND
T/F PURIFINER, INC.
DATED AUGUST 23, 1993

LEASE AGREEMENT

THIS LEASE, made this 23 day of August, 1993, by and between Papeyco Trading International, Inc., hereinafter called the "Landlord" and T.F. Purifiner, Inc., hereinafter called "Tenant";

1.01 A. Landlord: Papeyco Trading International, Inc. 45 O'Connor Street, Suite 1900 Ottawa, Ontario K1P 1A4

B. Tenant: T.F. Purifiner, Inc.

C. Address of Tenant: Suite 100 3020 High Ridge Road Boynton Beach, FL 33426

D. Premises: 12,000 square feet of space in Project located as shown on Exhibit "A" attached hereto.

E. Building: The Building in which the Premises is located.

F. Project: The land, improvements and appurtenances commonly referred to as Out parcel to the Boynton Beach Distribution Center and located at High Ridge Road, in Boynton Beach, Florida.

Said Project is depicted on Exhibit "A" attached hereto.

G. Lease Term: The lease terms shall commence on the following date September, 1, 1993 ("Commencement Date"): the date the Tenant commences its business operations in the Premises, and runs for 4 years. Upon lease execution the tenant shall deliver an amount equals to the base rent, which shall serve as the first months rent.

H. Rent: All sums, moneys or payments required to be paid by Tenant to Landlord pursuant to Section 6.01 of this Lease;

I. Base Rent: $3,100 per month, plus applicable Florida sales taxes. (See section 6.02 of this Lease).

J. Security Deposit: $3,100 .

K. Tenant's Proportionate Share: 20%.

L. Base Year: The calendar year in which this Lease commences.

1.02 EFFECT OF REFERENCE TO BASIC TERMS:

Each reference in this Lease to any of the Basic Terms contained in
Section 1.01 shall be construed to incorporate into such reference all of the definitions set forth in Section 1.01.

PREMISES

2.01 In consideration of the rents, covenant, agreements and conditions hereinafter provided to be paid, kept, performed and observed, the Landlord leases to the Tenant and the Tenant hereby rents from the Landlord the Premises described in Section 1.01 (D).

2.02 RESERVATIONS BY LANDLORD:

Landlord excepts and reserves the roof and exterior walls of the Building, and further reserves the right to place, install, maintain, carry through, repair or replace such utility lines, pipes, wires, appliances, tunnelling, and the like in, over, through and upon the Premises as may be reasonably necessary or advisable for the servicing of the Premises or any other portions of the Project.

Notwithstanding any provision in this Lease to the contrary, it is agreed that Landlord reserves the right, without invalidating this Lease or modifying any provisions thereof, at any time and from time to time, (i) to make alterations, changes and additions to the Building and other improvements in the Project, (ii) to add additional areas to the Project and/or to exclude areas therefrom, (iii) to construct additional buildings and other improvements in the Project, (iv) to remove or relocate the whole or any part of any building or other improvement in the Project, and (v) to relocate any other tenant in the Project. It is further understood that the existing layout of the buildings, walks, roadways, parking areas, entrances, exists, and other improvements shall not be deemed to be a warranty, representation or agreement on the part of the Landlord that the Project will remain exactly as presently built, it being understood and agreed that Landlord may change the number, dimensions and locations of the walks, buildings, and parking spaces as Landlord shall deem proper.

COMMENCEMENT AND EXPIRATION DATES

3.01 Lease Commencement Date. The Lease Commencement Date shall be:

(i) The date specified in Section G, unless notice is delivered pursuant to Subsection 3.01 (ii) or unless Tenant occupies earlier, pursuant to Subsection 3.01 (iii).

(ii) Such earlier or later date as may be specified in a notice delivered to Tenant at least 30 days before such date upon which the Premises, together with the common facilities for access and service thereto, have been completed; or

(iii) If Tenant shall occupy the Premises for Permitted Uses prior to the date specified in Section G or in the notice provided under subsection 3.01 (ii), the date of such early occupancy.

USE

4.01 The Premises hereby leased shall be used by the Tenant for the purpose of design, manufacturing and marketing of oil refining systems, and for no other purposes. Tenant shall, at Tenant's expense, comply promptly with all applicable statutes, ordinances, rules, regulations, orders and requirements in effect during the term or any part of the term hereof regulating the use by Tenant of the Premises. Tenant shall not use or permit the use of the Premises in any manner that will tend to create waste or a nuisance, or will tend to unreasonably disturb such other tenants in the Project. Tenant, its employees and all persons visiting or doing business with the Tenant in the Premises shall be bound by and shall observe the Rules and Regulations attached to this Lease, as Exhibit "B", and such further and other reasonable rules and regulations made hereafter by the Landlord relating to the Project or the Premises of which notice in writing shall be given to the Tenant and all such rules and regulations shall be deemed to be incorporated into and form a part of this Lease.

TERM

5.01 To have and to hold the Leased Premises for and during the Term described in Section 1.01 (G) above subject to the payment of the Rent and the full an timely performance by Tenant of the covenants and conditions herein set forth. At the termination or expiration of this Lease, Tenant will vacate and surrender the premises to the Landlord in accordance with the terms hereof and the Premises will be in broom- clean condition.

BASE RENT

6.01 Tenant covenants to pay without notice, deduction, set-off or abatement to Landlord the Base Rent specified in Section 1.01 (I) in lawful money of the United States in equal monthly installments in advance on the first day of each month during the Lease Term. Rental for any partial month shall be prorated on a per diem basis. Rentals shall be payable to Landlord at c/o Real Estate Recovery, Inc., 927 Clint Moore Road, Boca Raton, FL 33487 or such other place as Landlord may designate from time to time in writing. Tenant shall pay the

first full month's rent upon execution of this Lease. Tenant agrees to, and shall, pay all applicable sales taxes due and payable in connection with any rent or other payment due Landlord hereunder.

Months      4     to    12    $3.10 per Sq. Ft.  Net  Net   Net

Months      13    to    24    $3.75 per Sq. Ft.  Net  Net   Net

Months      25    to    36    $4.40 per Sq. Ft.  Net  Net   Net

Months      37    to    48    $4.95 per Sq. Ft.  Net  Net   Net


6.03                          ADDITIONAL CHARGES

Tenant shall also pay the following charges, which shall be considered, for purposes of default, as additional rent:

Such real estate taxes and assessments shall be paid by the Tenant to the Landlord in equal monthly installments on the first day of each calendar month during the term of this Lease. Said charges shall be based upon Landlord's estimated costs for the real estate taxes and assessments for the calendar year. The amount due for all partial calendar years shall be prorated on a per diem basis.

Within forty-five (45) days after the end of each calendar year, the Landlord shall furnish Tenant with a statement of the actual amount of Tenant's proportionate share of such real estate taxes and assessments for the preceding

calendar year. Within fifteen (15) days after receipt of said statement by the Tenant, the Tenant shall pay to the Landlord any deficiency due to the Landlord. Any surplus paid by the Tenant shall be credited against the next ensuing instalment of Landlord's estimate for Tenant's Proportionate Share of such real estate taxes and assessments.

(c) Municipal, County, State or Federal Taxes, Excluding Real Estate Taxes: Tenant shall pay all taxes assessed against any leasehold interest of Tenant or any fixtures, furnishings, equipment, stock-in-trade, or other personal property of any kind owned, installed, or used in or on the premises.

(d) Rental Taxes: Should any governmental taxing authority levy, assess, or impose any tax, excise or assessment (other than an income or franchise tax) upon or against the rentals payable by Tenant to Landlord, either by way of substitution for or in addition to any existing tax on land and buildings or otherwise, Tenant shall pay any such tax, excise or assessment thereof.

(e) Insurance: Tenant agrees to reimburse Landlord its Proportionate Share {Computed the same as in Subsection 6.03 (b)} of the total cost of premiums for Landlord's insurance coverages {excluding the amount thereof attributable to insuring the Common Areas, for which provision has been made in Subsection 6.03 (f)}.

Said insurance reimbursements shall be paid by the Tenant to the Landlord in equal monthly installments on the first day of each calendar month during the Term of the Lease. Said charges shall be based upon Landlord's estimated costs for the insurance reimbursements for the calendar year. The amount due for all partial calendar years shall be prorated on a per diem basis.

Within forty-five (45) days after the end of each calendar year, the Landlord shall furnish Tenant with a statement of the actual amount of Tenant's Proportionate Share of such insurance reimbursements for the preceding calendar year. Within fifteen (15) days after receipt of said statement by the Tenant, the Tenant shall pay to the Landlord any deficiency due the Landlord. Any surplus paid by the Tenant shall be credited against the next ensuing instalment of Landlord's estimate for Tenant's Proportionate Share of such insurance reimbursements.

(f) Common Area Expenses: Tenant agrees to pay to Landlord in the manner herein after provided, Tenant's Proportionate Share of all costs and expenses paid or incurred by Landlord on operating, policing, and protecting, lighting, providing sanitation, water and sewer and other services for, insuring, repairing, replacing and maintaining the common areas and all other facilities used in the maintenance or operation of, the Project. Such costs and expenses shall include, but shall not be limited to, the cost of: Illumination and maintenance of common signs, refuse disposal, water, gas, sewage, electricity and other utilities (without limitation), including any and all usage, service, hook up, connection, availability and/or standby fees or charges

pertaining to same, maintenance and operation of any temporary or permanent utility, compliance with rules, regulations and orders of governmental authorities pertaining to air pollution control, including the cost of monitoring air quality, cleaning, lighting, striping and landscaping curbs, gutters, sidewalks, drainage and irrigation ditches, conduits, pipes located on or adjacent to the Project; premiums for liability, casualty, and property insurance: personal property taxes; licensing fees and taxes: audit fees and expenses, supplies; depreciation of maintenance equipment used in the operation or maintenance of the common areas: total compensation and benefits (including premiums for workmen's compensation and other insurance paid to or on behalf of employees involved in the performance of the work specified in this subsection. The Proportionate Share to be paid by Tenant shall be that portion of the foregoing costs and expenses which the number of square feet of floor area in the leased Premises bears to the total number of square feet of gross leasable area of the Building in the Project.

For the period of September 1, 1993, through December 31, 1993, until notified by Landlord otherwise, the common area expense (CAM) shall be based on $1.89/sf or $1,890, monthly. No more than 10% increase per year. CAM includes 6.03 A through F. At no time shall the CAM rate be less than $1.89/sf throughout the term of the Lease.

Tenant's Proportionate Share of such costs and expenses for each lease year shall be paid in monthly installments on the first day of each calendar month, in advance, in an amount estimated by Landlord from time to time. Subsequent to the end of each lease year, Landlord shall furnish Tenant with a statement of the actual amount of Tenant's Proportionate Share of such cost and expenses for such period. If the total amount by Tenant under this subsection for any such year shall be less than the actual amount due from Tenant for such year as shown on such statement, Tenant shall pay to Landlord the difference between the amount, paid by Tenant and the actual amount due, such deficiency to be paid within ten (10) days after the furnishing of each such statement, and (if the total amount paid by Tenant hereunder for any such year shall exceed such actual amount due from Tenant hereunder for any such year shall exceed such actual amount due from Tenant for such year, such excess shall be credited against the next instalment due from Tenant to Landlord under this subsection.

UTILITIES AND SERVICES

7.01 Tenant shall contract in its own name and pay for all charges for electricity, gas, fuel, telephone, trash hauling, and any other services or utilities used in or assessed against the Premises.

QUIET ENJOYMENT

8.01 Landlord covenants that the Tenant, on timely paying the rent herein provided and keeping, performing, and observing the covenants, agreements and

conditions herein required of the Tenant, shall peaceably and quietly hold and enjoy the Premises for the term aforesaid, subject, however, to the terms of this Lease.

ASSIGNMENT AND SUBLETTING

9.01 The Tenant shall not assign or hypothecate this Lease or sublet all or any part of the Premises without the prior written consent of Landlord, which consent may be withheld in the sold and absolute discretion of Landlord.

DAMAGE OR DESTRUCTION

10.01 If the Premises, the Building or the Project described above or any part thereof is damaged by fire or other casualty, cause or condition whatsoever and the Landlord shall determine not to restore said Premises, Building or Project, Landlord may by written notice to the Tenant given within sixty (60) days after such damage, terminate this Lease as to all of the Premises covered by the Lease. Such termination shall become effective as of the date of the damage. If this Lease is not terminated as above provided and if said Premises are made partially or wholly untenantable as aforesaid, Landlord, at its expense, shall restore the same with reasonable promptness to the condition in which Landlord furnished the Premises to Tenant at the commencement of the term of this Lease as to those items that were provided to the Premises at Landlord's expense without any reimbursement by Tenant. Landlord shall be under not obligation to restore any alteration, improvements or additions to the Premises made by Tenant or paid for by Tenant, including, but not limited to, any of the initial tenant finish done or paid for by Tenant, or any subsequent charges, alterations or additions made by Tenant.

If, as a result of fire or other casualty, cause or condition whatsoever the Premises are made partially or wholly untenantable and, if Landlord has not given the sixty (60) days notice above provided for an fails within one hundred twenty (120) days after such damage occurs to eliminate substantial interference with Tenant's use of said Premises or substantially to restore said Premises, the Tenant may terminate this Lease as of the end of said one hundred twenty
(120) days by written notice to landlord given not later than five (5) days after expiration of said one hundred twenty (120) day period. If the Premises are rendered totally untenantable but this Lease in not terminated, all rent shall abate from the date of the fire or other relevant cause or condition until the Premises are ready for occupancy and reasonable accessible to Tenant.

If a portion of the Premises is untenantable, rent shall be prorated on a per diem basis and apportioned in accordance with the portion of the Premises which is usable by the Tenant until the damaged part is ready for the Tenant's occupancy. In all cases, due allowance shall be made for reasonable delay caused by adjustment of insurance loss, strikes, labor difficulties or any cause beyond Landlord's reasonable control. For the purposes of this Lease, said Premises shall be considered tenantable so long as and to the extent that the Premises

are occupied by Tenant or usable (whether or not actually occupied). In any event, Tenant shall be responsible for the removal, or restoration, when applicable, of all its damaged property and debris from the Premises, upon request by Landlord or reimburse Landlord for the cost of removal.

LANDLORD'S RIGHTS

11.01 Landlord reserves the following rights:

(a) To change the name of the Building or the Project without notice or liability of the Landlord to Tenant;

(b) During the last ninety (90) days of the term or any renewal thereof, or any part thereof, if during or prior to that time the Tenant has vacated the Premises, to decorate, remodel, repair, alter or otherwise prepare the Premises for reoccupancy;

(c) To exhibit the Premises to others and to display "For Lease" signs on the Premises during the last one hundred eighty (180) days of the term or any renewal thereof;

(d) To remove abandoned or unlicensed vehicles and vehicles that are unreasonably interfering with the use of the parking lot by others from the parking lot and charging the responsible tenant for the expense of removing said vehicles; and

(e) To take any and all measures, including making inspection, repairs, alterations, additions and improvements to the Premises or the Building or to the Project as may be necessary or desirable for the safety, protection or preservation of the Premises or the Building or the Project or the Landlord's interests, or as may be necessary or desirable in the operation of the Premises or the Building or the Project.

The Landlord may enter upon the Premises at any time or times for the purpose of exercising any or all of the foregoing rights hereby reserved without being deemed guilty of an eviction or disturbance of the Tenant's use or possession and without being liable in any manner to the Tenant.

HOLDING OVER

12.01 In the event of holding over by Tenant after the expiration or termination of this Lease without the consent in writing of the Landlord, Tenant shall be deemed a Tenant at sufferance and shall, unless otherwise prohibited by applicable law, pay as liquidated damages, double rent for the entire holdover

period and all reasonable attorney's fees and expenses incurred by Landlord in enforcing its rights hereunder. Any holding over with consent of Landlord shall constitute Tenant a month-to-month tenant.

SIGNS AND ADVERTISEMENTS

13.01 Tenant shall not put upon nor permit to be put upon any part of the Premises, the Building or the Project, any signs, billboards or advertisements whatever in any location or any location or any form without (a) the prior written consent of Landlord, which consent may be withheld in the sold and absolute discretion of Landlord, and (b) complying with all applicable laws, regulations, permits, rules and ordinances.

MORTGAGE AND TRANSFER

14.01 Landlord shall have the right to transfer, mortgage, pledge or otherwise encumber, assign and convey, in whole or in part, the Premises, the Building, the Project, this Lease, and all or any part of the rights now or thereafter existing and all rents and amounts payable to Landlord under the provisions hereof. Nothing herein contained shall limit or restrict any such rights, and the rights of the Tenant under this Lease shall be subject and subordinate to all instruments executed and to be executed in connection with the exercise of any such rights, including, but not limited to, the lien of any mortgage, deed of trust, or security agreement now or hereafter placed upon Landlord's interest in the covenants and agrees to execute and deliver upon demand such further security agreement as shall be requested by the Landlord and/or mortgagee or proposed mortgagee or holder of any security agreement and hereby irrevocably appoints the Landlord as its agent and attorney to execute and deliver any such instrument for and in the name of the Tenant.

EMINENT DOMAIN

15.01 If the Premises or any substantial part thereof shall be taken by any competent authority under the power of eminent domain or be acquired for any public or quasi-public use or purpose, the term of this Lease shall cease and terminate upon the date when the possession of said Premises or the part thereof so taken shall be required for such use or purpose and without apportionment of the award and Tenant shall have no claim against Landlord for the value of any unexpired term of this Lease. If any condemnation proceeding shall be instituted in which it is sought to take any part of the Project or to change the grade of any street or alley adjacent to the Premises and such taking or change of grade makes it necessary or desirable to remodel the Building or the Project to conform to the changed grade, Landlord shall have the right to cancel this Lease after having given written notice of cancellation designated in the notice. In either of said events rent at the then current rate shall be apportioned as of the date of termination. No money or other consideration shall be payable by the Landlord to the Tenant for the right of cancellation and the Tenant shall have no right to share in the condemnation award or in any judgement for damages

caused by the taking or the change of grade. Nothing in this paragraph shall preclude an award being made by the taking authority to Tenant for loss of business or depreciation to and cost of removal of equipment or fixtures.

LANDLORD'S INABILITY TO PERFORM

16.01 If, by reason of inability to obtain and utilize labor, materials or supplies; circumstances directly or indirectly the results of a state of war of national or local emergency; any laws, rules, orders, regulations or requirements of any governmental authority now or hereafter in force; strikes or riots; accident in, damage to or the making of repairs, replacements, or improvements to, the Premises or any of the equipment thereof; or by reason of any other cause beyond the reasonable control of the Landlord, the Landlord shall be unable to perform or shall be delayed in the performance, such events or circumstances or inability shall not render Landlord liable in any respect for damages to either person or property, constitute a total or partial eviction, constructive or otherwise, work an abatement of rent or relieve Tenant from the fulfillment of any covenant or agreement contained in this Lease.

BANKRUPTCY OR ASSIGNMENT TO TRUSTEE

17.01 To the fullest extent permitted by applicable law, neither this Lease nor any interest therein nor any estate hereby created shall pass to any trustee or receiver in bankruptcy or to any other receiver or assignee for the benefit of creditors or otherwise by operation of law during the term of this Lease or any renewal thereof.

COMMON AREAS

18.01 The term "Common Areas" means all the areas of the Project not intended for renting and, instead, designed for the common use and benefit of the Landlord and all of the tenants, their employees, agents, customers and invitees. The Common Areas include, but not by way of limitation, parking lots, truck courts, landscaped and vacant areas, driveways, and walks and curbs with facilities appurtenant to each as such areas may exist from time to time. Landlord shall operate and maintain the Common Areas of the Project. Landlord hereby grants to Tenant the nonexclusive revocable use of the Common Areas by Tenant, Tenant's employees, agents, customers and invitees which use shall be subject at all times to such reasonable, uniform and non-discriminatory rules and regulations as may from time to time be established by Landlord. Tenant covenants and agrees to abide by any rules or regulations promulgated by Landlord.

ACCEPTANCE OF PREMISES

19.01 Landlord will complete the Premises in accordance with the Exhibit attached hereto as Exhibit " ". Tenant acknowledges that it will examine the Premises before taking possession hereunder. Unless Tenant furnished Landlord

with a notice in writing specifying any defect in the construction of the Premises prior to taking possession, such taking of possession shall be conclusive evidence as against the Tenant that at the time thereof the Premises were in good order and satisfactory condition.

19.02 MAINTENANCE AND CARE BY TENANT:

Tenant shall be responsible for all maintenance and repair to the Premises of whatsoever kind or nature that is not hereinafter set forth specifically as the obligation of Landlord. Tenant shall take good care of the Premises and fixtures, and keep them in good repair free from filth, overloading, danger of fire or any pest or nuisance, and Tenant shall repair any damage or breakage done by Tenant or Tenant's agents, employees or invitees, including damage done to the Building by Tenant's equipment or installations. Tenant shall be responsible for the repair and replacement of all glass and plate glass on the Premises. Tenant shall furnish and pay for the upkeep, maintenance, repair and periodic servicing of the heating, ventilation and air conditioning system servicing the Premises. At the end of the term of this Lease or any renewal hereof, Tenant shall quit and surrender the Premises broom clean in as good condition as when received by Tenant, normal wear and tear excepted. In the event Tenant fails to maintain the Premises as provided for herein Landlord shall have the right, but not the obligation, to perform such maintenance as is required of in which event Tenant shall reimburse Landlord for its costs in providing such maintenance or repairs together with a ten (10%) percent charge (equal to 10% of said costs) for Landlord's overhead and Tenant shall promptly reimburse Landlord for the amount so billed to Tenant by Landlord.

INSURANCE

21.01 Tenant covenants and agrees to maintain on the Premises at all times during the term of this Lease, and during all renewal thereof, a policy or policies of comprehensive public liability and property damage insurance with not less than $1,000,000.00 combined single limit for both bodily injury and property damage. Each policy of insurance shall name as the insured thereunder both the Tenant and the Landlord. Each such liability insurance policy shall be of the type commonly known as the Owner's, Landlord's and Tenant's Insurance and shall be obtained from a company satisfactory to Landlord. The original of each such policy of insurance or certified duplicates thereof shall be delivered by Tenant to Landlord on or before ten (10) days prior to occupancy of the premises by Tenant, said policy shall contain a provision stating that it cannot be cancelled or modified unless the insurance company first provides at least ten
(10) days prior written notice to Landlord of said cancellation or modification.

21.02 MUTUAL SUBROGATION:

Landlord and Tenant do each hereby release the other from any and all liability or responsibility (to the other or anyone claiming through or under them by way of subrogation or otherwise) for any loss or damage to property caused by faire, any of the extended coverage perils or any other insured peril, even if such fire or other casualty shall have been caused by the fault or negligence of the other party and in force and effect only with respect to loss or damage occurring during such time as the Landlord's and Tenant's policies shall contain a clause or endorsement to the effect that any such release shall not adversely affect or impair said policies or prejudice the right of the releasor to recover thereunder. Landlord and Tenant each agree that its polices will include such a clause or endorsement. Tenant shall comply with all insurance regulations so the lowest fire, lightning, explosion, extended coverage and liability insurance rates may be obtained; and nothing shall b done or kept in or on the Premises by Tenant which will cause an increase in the premium for any such insurance on the Premises or the Building or on any contents located therein, over the rate usually obtained for the proper use of the Premises permitted by this Lease or which will cause cancellation of any such insurance.

21.03 INDEMNIFICATION OF LANDLORD:

Tenant shall indemnify the Landlord and save it harmless from and against any and all loss (including loss of rentals payable by the Tenant or other tenants) and against all claims, actions, damages, liability and expenses in connection with loss of life, bodily and personal injury or damage to real property arising from any occurrence in, upon or at the Premises or any part thereof or Building or Project, or occasioned wholly or in part by any act or omission of the Tenant, its agents, contractors, employees, servants, licensees, concessionaires or invitees or by anyone permitted to be on the Premises or Building or Project by the Tenant. Tenant assumes all risks of and Landlord shall not be liable for injury to person or damage to property resulting form the condition of the Premises or from the bursting or leaking of any and all pipes, utility lines, connections, or air conditioning or heating equipment in, on or about the Premises, or from water or rain which may leak into, issue or flow from any part of the Building. Tenant agrees, at all times, to indemnify and hold Landlord harmless against all actions, claims, demands, costs, damages or expenses of any kind which may be brought or made against the Landlord or which the Landlord may pay or incur by reason of Tenant's occupancy of the Premises or its negligent performance of or failure to perform any of its obligations under this Lease. In case the Landlord shall, without fault on its part, be made a party to any litigation commenced by or against the Tenant, then the Tenant shall protect and hold the Landlord harmless and shall pay all costs, expenses and reasonable attorney's fees incurred or paid by the Landlord in connection with such litigation.

USE OF COMMON AREAS BY TENANT

22.01 Tenant shall not use any part of the Project exterior to the Premises for outside storage. No trash, crates, pallets, or refuse shall be permitted anywhere on the Project outside of the Premises by Tenant except in enclosed metal containers to be located as directed by Landlord. Tenant shall not park any trucks or trailers, loaded or empty, except in front of the docks on the concrete apron provided for such purposes.

23.01       In the event:

            (a)   Tenant shall at any time fail to pay rent when due; or

            (b)   Tenant  shall  fail to keep,  perform  or  observe  any  other
                  covenant,  agreement,  condition or undertaking  hereunder and
                  shall fail to remedy such  default  within ten (10) days after
                  written  notice thereof has been mailed by Landlord to Tenant;
                  or

            (c)   The Premises shall be vacated or abandoned by Tenant;

Landlord shall have the right, without further notice to or demand upon the Tenant, to re-enter and take exclusive possession of the Premises with or without force or legal process, and to refuse to allow Tenant to enter the same or have possession thereof; to change the locks on the doors to the Premises; take possession of any furniture or other property in or upon the Premises (Tenant hereby, to the fullest extent permitted by applicable law, waiving the benefit of all ex-exemptions by law), sell the same at public or private sale without notice and apply the proceeds thereof to the costs of sale, payment of damages and payment due of the rent under this Lease; all without being liable to the Tenant for any damages or to and prosecution therefor; and

(i) As agent of the Tenant to relet the Premises for the balance of the term of this Lease or for a shorter or longer term and receive the rents therefor, applying them first to the payment of the expense of such reletting and, second, to the payment of damages suffered to the Premises and rent due and to become due under this Lease, Tenant remaining liable for and hereby agreeing to pay Landlord any deficiency; or

(ii) To cancel and terminate the remaining term of this Lease, re-enter and take possession of the Premises free of this Lease and thereafter this Lease shall be null and void and the rent in such case shall be apportioned and paid on and up to the date of such entry. Thereafter both parties shall be released and relieved from

and of any and all obligations thereafter to accrue hereunder. Tenant shall be liable for all loss and damage resulting from such breach or default; or

(iii) Accelerate rent payments due or to become due at the rates applicable during the period which the default occurs, and sue for said rent.

All rights and remedies expressly provided in this Lease for Landlord's protection shall be cumulative of any other rights and remedies provided by law. Landlord shall be entitled to recover from Tenant its reasonable attorney's fees and costs incurred in enforcing its rights hereunder.

A waiver by Landlord of a breach or default by Tenant under the terms and conditions of this Lease shall no be construed to be a waiver of any subsequent breach or default of any other term or condition of this Lease, and the failure of Landlord to assert any breach or to declare a default by Tenant shall not be construed to constitute a waiver thereof so long as such breach or default continues unremedied.

Any and all sums due under this Lease from Tenant to Landlord and not paid on the due date shall bear interest from the due date at the highest rate then allowable by applicable law until fully paid.

NOTICES

25.01 Except as otherwise herein provided, whenever by the terms of this Lease notice shall or may be given to the Landlord or to the Tenant, such notice shall be in writing and shall be deemed to have been properly served if sent by certified mail return receipt requested, postage prepaid, to Landlord at the place where rent is payable and to Tenant at the Premises. The date of mailing shall be deemed the date of service.

PERSONS BOUND

26.01 The agreements, covenants and conditions of this Lease shall be binding upon and inure to the benefit of the heirs, legal representatives, successors and assigns of each of the parties hereto, except that no assignment, encumbrance or subletting by Lessee, unless permitted by the provisions of this Lease, without the prior written consent of Landlord shall vest any right in the assignee, encumbrancee or sublessee of Tenant. This lease contains the entire agreement in writing signed by the Landlord and Tenant after the date hereof. The singular herein, in referring to Landlord or tenant, shall be deemed to include the plural where the context so requires. If there be more than one Tenant herein named, the provisions of this Lease shall be applicable to and binding upon such Tenants jointly and severally.

9

SECURITY DEPOSIT

27.01 Tenant herewith deposits with Landlord the sum of $3,100 as security for the performance by Tenant of every covenant and condition of this Lease. Such deposit may be mingled with other funds of Landlord and shall bear no interest. If Tenant shall default with respect to any covenant or condition of this Lease, Landlord may apply from time to time without prejudice to any other remedy the whole or any part of such Security Deposit to the payment of any sum in default. Following any such application of the Security Deposit, Tenant shall pay to Landlord on demand the amount so applied in order to restore the Security Deposit to its original amount. This includes, but is not limited to, applying the Security Deposit first to any restoration and/or cleanup costs necessary over and above normal wear and tear of the vacated space. It is understood that the Security Deposit is not to be considered as the last month's rent under the Lease. Should Tenant comply with all of the covenants and conditions of this Lease, the Security Deposit or any balance thereof shall be returned to Tenant at the expiration of the term hereof. If Landlord transfers its interest in the Premises during the term of this Lease, Landlord may assign the Security Deposit to the transferee and thereafter Landlord shall have no further liability for the return of such Security Deposit.

LATE PAYMENT

28.01 Tenant's failure to make any rental payment or other payment required of Tenant hereunder within ten (10) days of the due date therefor shall result in the imposition of a service charge for such late payment in the amount of five percent (5%) of the late payment.

29.01 Does not exist.

PARTIAL INVALIDITY

30.01 If any term, covenant, condition or provision of this Lease or the application thereof to any person or circumstances shall, to any extent be invalidated, unenforceable or violate a party's legal rights, then such term, covenant, condition or provision shall be deemed to be null and void and unenforceable, however, all other provisions of this Lease, or the application of such term or provision to persons or circumstances other than those to which are held invalid, unenforceable or violative of legal rights, shall not be affected thereby, and each and every other term, condition, covenant and provision of this Lease shall be valid and be enforced to the fullest extent permitted by law.

CAPTIONS

31.01 The captions used throughout this Lease are for convenience of reference only and shall in no way be held to explain, modify, amplify, or aid in the interpretation, construction or meaning of any provisions in this Lease.

ENTIRE AGREEMENT

32.01 This Lease contains the entire agreement between the parties hereto and no modification of this Lease shall be binding upon the parties hereto unless evidenced by an agreement in writing signed by the Landlord and the Tenant after the date hereof. If there be more than one Tenant named herein, the provisions of this Lease shall be applicable to and binding upon such tenants jointly and severally.

TRANSFERS BY LANDLORD

33.01 Landlord shall have the right to transfer and assign, in whole or in part, all its rights and obligations hereunder and in the Building and the Premises and the Project referred to herein; and in such event and upon such transfer Landlord shall be released from any further obligations hereunder, and Tenant agrees to look solely to such successor in interest of Landlord for the performance of such obligations.

EFFECTIVE DELIVERY OF THIS LEASE

34.01 Landlord has delivered a copy of this Lease to Tenant for Tenant's review and the delivery hereof does not constitute an offer to Tenant or an option to lease. This Lease shall not be effective until a copy executed by both Landlord and Tenant is delivered to and accepted by Landlord.

RULES AND REGULATIONS

35.01 Tenant will comply with the reasonable rules and regulations of the Building adopted and altered by Landlord from time to time as well as the rules and regulations other applicable restrictions adopted by the property owners' association, if any, having jurisdiction over the Premises or any portion thereof or having jurisdiction over the common area of the Project.

LIMITATION OF LIABILITY

36.01 The liability of Landlord to Tenant for any default by Landlord under the terms of this Lease shall be limited to the interest of the Landlord in the Building and the Premises, and Tenant agrees to look solely to Landlord's interest in the Building and the Premises for the recovery of any judgment from the Landlord, it being intended that Landlord shall not be personally liable for any judgment or deficiency.

TIME OF PERFORMANCE

37.01 Except as expressly otherwise herein provided, with respect to all required acts of Tenant, time is of the essence of this Lease.

RECORDATION

38.01 Tenant agrees not to record this Lease or any memorandum hereof, but Landlord may record this Lease or memorandum thereof, at its sole election, and Tenant agrees to execute such memorandum upon request by Landlord.

APPLICABLE LAW / VENUE

39.01 This Lease is entered into in the State of Florida and shall be governed by the applicable laws of the State of Florida. Venue shall be in the courts of Palm Beach County, Florida and both parties consent to the jurisdiction of those courts with respect to any legal action concerning this Lease.

IN WITNESS WHEREOF, the parties have signed triplicate copies hereof.

WITNESSES:

Papeyco Trading International, Inc.

_________________________________         BY:_/s/__(unintelligible)
                                                Landlord

_________________________________         T/F Purifiner, Inc.

ADDENDUM TO LEASE AGREEMENT

This Addendum shall be incorporated into that certain Lease Agreement executed by and between the Landlord, Papeyco Trading International, Inc., and the Tenant, T.F. Purifiner, Inc., to allow for the following provisions:

ASSIGNMENT OF ANNUITY:

As additional consideration, the parties have negotiated the assignment of an Annuity Contract as issued by The Guardian Insurance & Annuity Company, Inc. Contract No. 210094083 held in the name of Richard C. Ford, 14402 Cypress Island Court, Palm Beach Gardens, Florida. Said assignment shall be in favor of Papeyco Trading International, Inc. The value of the annuity as of August 6, 1993, is $22,256.38 and shall be assigned for a period of one year from rent commencement expiring December 1, 1994. In the event of a default under the terms and conditions of the lease, the Landlord may negotiate the annuity for an amount equal to the delinquency. But not more than fifteen thousand dollars.

IMPROVEMENT OF THE LEASED PREMISES:

The Landlord shall cause the placement of a demising wall, which shall delineate the space to be occupied by the tenant. This shall be completed at the sole expense of the Landlord.

Upon execution of the lease, the Tenant may proceed to improve the warehouse or the office space of the building to be occupied, at their sole expense. The Tenant may improve the warehouse to air condition same, but in the event of a default during the lease term expiring August 31, 1997, the Landlord may seize the air conditioning improvements as additional consideration to apply to amounts due under the lease.

Improvements made by the Tenant shall be accomplished without any recording instruments affecting title to the building. The Landlord shall cause a title search to be accomplished upon completion of the improvements as additional consideration to apply to amounts due under the lease.

Improvements made by the Tenant shall be accomplished without any recording instruments affecting title to the building. The Landlord shall cause a title search to be accomplished upon completion of the improvements to the warehouse by the Tenant.

All other terms and conditions set forth in the Lease Agreement shall remain the same. This Addendum shall be incorporated and remain a part of the lease between the parties set forth above.

LANDLORD:                                   TENANT:


By:__(Unintelligible)______________         By:_/s/ Richard C. Ford, President
Papeyco Trading International, Inc. Date    T.F. Purifiner, Inc. 8/23/96

SECOND ADDENDUM TO LEASE AGREEMENT

This Second Addendum shall be incorporated with the terms and conditions of that certain Lease Agreement dated August 23, 1993, by and between Papeyco Trading International, Inc. ("Lessor") and T. F. Purifiner, Inc. ("Lessee").

The following amendments shall be effective April 1, 1994, which hereafter shall be referred to as the lease commencement date of the agreement.

ASSIGNMENT OF ANNUITY/CERTIFICATE OF DEPOSIT:

As additional consideration, the Lessee shall place $15,000 in the form of an Assignment of an Annuity or Certificate of Deposit with the Lessor for a period of one year with an expiration of April 1, 1995, by May 1, 1994.

AMENDMENT TO THE LEASE TERM:

The Lessee shall extend the term of the lease for a fifth year pursuant to the terms set forth in Section 6.01 of the Lease Agreement, based upon the rent schedule in Months 37 through 48 at $4.95. The fifty year shall commence in Month 49 and extend through Month 60 from April 1, 1994, at the same rate of $4.95/sf.

RENT COMMENCEMENT:

Pursuant to the terms of the Lease Agreement a period of three months shall be granted to the Lessee as rent concession. Accordingly, the rent commencement shall be effective July 1, 1994.

LESSOR:                                   LESSEE:
PAPEYCO TRADING INTERNATIONAL, INC.       T. F. PURIFINER, INC.


By:_(Unintelligble)_________________      By: RICHARD C. FORD, PRESIDENT
                                              --------------------------
Dated this 8th day of April, 1994.

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Witness                                   Witness