SERVICE SYSTEMS INTERNATIONAL LTD, S-8, 1997-10-06

SERVICE SYSTEMS INTERNATIONAL LTD
S-8, 1997-10-06
SANITARY SERVICES

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 6, 1997
REGISTRATION NO. 333-**
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933

SERVICE SYSTEMS INTERNATIONAL, LTD.
(Exact name of registrant as specified in its charter)

NEVADA 88-0263701
(State of Incorporation) (I.R.S. Employer Identification No.)

2800 INGLETON AVENUE
BURNABY, B.C., CANADA V5C 6G7
(604) 451-1069
(Address of Principal Executive Offices)

SERVICE SYSTEMS INTERNATIONAL, LTD. 1997 STOCK OPTION PLAN
(Full title of Plan)

Copy to:

MR. KENNETH R. FIELDING ALISON K. SCHULER, ESQUIRE
Service Systems International, Ltd. Schuler, Messersmith & McNeill
2800 Ingleton Avenue 5700 Harper NE Suite 430
Burnaby, B.C., Canada V5C 6G7 Albuquerque, New Mexico 87109
(505) 822-8826
(604) 451-1069
(Telephone number, including area
code, of agent for service)

APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: AS SOON AS PRACTICABLE
AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [x ]

EXHIBIT INDEX APPEARS AT PAGE
PAGE 1 OF ** PAGES

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CALCULATION OF REGISTRATION FEE

Titles of Each Class Amount to be Proposed Maximum Proposed Maximum Amount of
of Securities to be Registered(1) Offering Price Per Aggregate Offering Registration Fee
Registered Security Price(2)
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<S> <C> <C> <C> <C>

Common Stock 1,588,000 Shares $1.53 $1,753,141
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Total Registration Fee $531.26

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1 Indicates the aggregate number of shares of Common Stock, $ .001 as par
value, ("Common Stock") authorized and reserved for issuance and which may be
sold upon the exercise of options which previously have been granted and/or
may be granted under the Service Systems International, Ltd. Stock Option
Plan ("Plan"), plus such additional number of shares as may be issued
pursuant to the Plan in the event of a stock dividend, stock split,
recapitalization or other similar change in the Common Stock.

2 This calculation is made solely for the purpose of determining the
registration fee pursuant to the provision of Rule 457(h) under the Securities
Act of 1933 (the "Act") as follows: (i) in the case of shares of Common Stock
which may be purchased upon the exercise of outstanding options, the fee is
calculated on the basis of the price at which the options may be exercised; and
(ii) in the case of shares of Common Stock for which options have not yet been
granted and the option price of which is therefore unknown, the fee is
calculated on the basis of the average of the bid and asked price of a share of
Common Stock reported on the over-the-counter Nasdaq Bulletin Board of the
National Association of Securities Dealers Automated Quotation System ("NASDAQ")
as of October 1, 1997 (within 5 business days before filing this Registration
Statement).

EXPLANATORY NOTE

In accordance with the instructional Note to Part 1 of Form S-8 as
promulgated by the Securities and Exchange Commission, the information specified
by Part 1 of Form S-8 has been omitted from this Registration Statement on Form
S-8 for offers of Common Stock of Service Systems International, Ltd.
("Company") pursuant to the Plan.

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1,588,000 SHARES OF COMMON STOCK

SERVICE SYSTEMS INTERNATIONAL, LTD.

Issuable upon exercise of options covered by the:
1997 Stock Option Plan

This Prospectus is being used in connection with the offer and sale from
time to time of Service Systems International, Ltd. ("Company" or "SSI") of
shares ("Shares") of the $.001 par value Common Stock of SSI ("Common Stock")
which may be acquired upon the exercise of stock options pursuant to the 1997
Stock Option Plan (the "Plan"). SSI will not receive any of the proceeds from
the sale of the Shares (although SSI will receive the proceeds of option
exercises by the those who hold options).

The Shares may be sold from time to time by option holders or by pledgees,
donees, transferees or other successors in interest. These sales may be made on
the National Association of Securities Dealers Automated Quotation System Over
the Counter market ("NASDAQ") or otherwise at market prices then prevailing or
at negotiated fees. All selling and other expenses (including discounts,
commissions or fees) incurred by the Selling Shareholders, or by pledgees,
donees, transferees or other successors in interest, in connection with the sale
of the Shares will be paid by the Selling Shareholders, or by pledgees, donees,
transferees or other successors in interest, or by the purchasers of the Shares,
except that the expenses of preparing this Prospectus and preparing and filing
the related Registration Statement with the Securities and Exchange Commission
and of registering or qualifying the Shares will be paid by SSI. See "Plan of
Distribution."

The option holders, or pledgees, donees, transferees or other successors in
interest, and brokers through whom sales of the Shares are made may be deemed to
be "underwriters" within the meaning of Section 2(11) of the Securities Act of
1933, as amended (the "Act"). Any profits realized by the option holders or
those brokers on the sale of the Shares may be deemed to be underwriting
commissions under the Securities Act.

The Common Stock of Service Systems International, Ltd. is listed on the
NASDAQ over the counter market under the symbol "SVSY." The Closing Price of
SSI's Common Stock as reported on NASDAQ on October 2, 1997, was $1.50.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
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No person is authorized to give any information or to make any
representations, other than as contained in this Prospectus, in connection with
the offer made in this Prospectus, and any information or representation not
contained herein must not be relied upon as having been authorized by SSI or the
option holders, or by pledgees, donees, transferees or other successors in
interest. This Prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any Registered Shares offered hereby to any
person in any jurisdiction where it is unlawful to make such an offer or
solicitation to that person. Neither the delivery of this Prospectus nor any
sale hereunder shall under any circumstances create any implication that
information contained herein is correct as of any time subsequent to the date
hereof.

SEE "RISK FACTORS", PAGE 4, FOR DISCUSSION OF CERTAIN FACTORS WHICH
SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS IN THE COMMON STOCK OFFERED
HEREBY.

The date of this Prospectus is October 6, 1997.

STATEMENT OF AVAILABLE INFORMATION

A Registration Statement on Form S-8, including amendments thereto,
relating to the Common Stock offered hereby has been filed by the Company
with the Securities and Exchange Commission (the "Commission"), Washington,
D.C. 20549. This Prospectus does not contain all of the information set
forth in the Registration Statement and the exhibits and schedules thereto.
For further information with respect to the Company and the Common Stock,
reference is made to that Registration Statement, and exhibits and schedules
thereto. Statements contained in this Prospectus as to the contents of any
contract or other document referred to are not necessarily complete, and in
each instance reference is made to the copy of that contract or other
document filed as an exhibit to the Registration Statement, each such
statement being qualified in all respects by that reference. Service Systems
International, Ltd. is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance with those requirements files reports and other information with
the Commission. Information, including reports and proxy and information
statements, filed by Service Systems International, Ltd. with the Commission
and a copy of the Registration Statement, including exhibits thereto, can be
inspected and copied at the public reference facilities of the Commission at
Room 1024, Judiciary Plaza, 450 Fifth Street N.W., in Washington, D.C.,
20549, or at its Regional Office located at 5670 Wilshire Boulevard 11th
Floor, Los Angeles, California 90036-3648. Copies of this material can be
obtained from the Public Reference Section of the Commission, 450 Fifth
Street N.W., Washington, D.C., 20549, at prescribed rates. Service Systems
International, Ltd. Common Stock is traded on the National Association of
Securities Dealers, Inc. over-the-counter electronic bulletin board system.
Reports, 2 <PAGE>

proxy and information statements, and other information concerning the Company
can be inspected at the National Association of Securities Dealers, Inc. at 1735
K Street, NW, Washington, D.C. 20006. The Commission maintains a web site that
contains proxy and information statements and other information regarding
registrants, such as the Company, that file electronically with the Commission
and the address of that site is www.sec.gov.

THE COMPANY

THIS PROSPECTUS CONTAINS FORWARD-LOOKING STATEMENTS WHICH INVOLVE RISKS AND
UNCERTAINTIES. THE COMPANY'S ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE
ANTICIPATED IN THESE FORWARD-LOOKING STATEMENTS AS A RESULT OF CERTAIN FACTORS
INCLUDING THOSE SET FORTH IN THE "RISK FACTORS" SECTION AND ELSEWHERE IN THIS
PROSPECTUS.

The Company is, through its majority-held subsidiary UV Systems Technology,
Inc. ("UVS"), is the manufacturer and marketer of state-of-the-art ultraviolet
disinfection systems for wastewater. The Company is committed to development
and commercialization of superior, cost-effective environmentally friendly,
ultraviolet-based water treatment systems. Through UVS, the Company holds two
United States patents and five international patents on various components of
its Ultra Guard-TM- ultraviolet disinfection system, including the flow reactor
chamber and its discharge weir.

The Company's executive offices are located at 2800 Ingleton Avenue,
Burnaby, B.C. Canada, V5C 6G7 and its telephone number is (604) 451-1069. It
maintains a world wide web site at http://web20.mindlink.net/info-
data/profiles/svsy.html. References in this document to the "Company" include
its consolidated majority-owned subsidiary, UVS, unless the context otherwise
requires. ULTRA GUARD-Registered Trademark- and the Company's "WAVY LINES &
DESIGNS" logo are registered trademarks of the Company. All other trademarks or
tradenames referred to in this Prospectus are the property of their respective
owners. All monetary figures in the document are in United States dollars
unless otherwise indicated. Canadian dollars are indicated as "C$".

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RISK FACTORS

AN INVESTMENT IN THE SHARES INVOLVES A HIGH DEGREE OF RISK AND IS
SPECULATIVE IN NATURE. IN ADDITION TO THE OTHER INFORMATION IN THIS PROSPECTUS,
PROSPECTIVE INVESTORS SHOULD CONSIDER CAREFULLY THE FOLLOWING RISK FACTORS IN
EVALUATING AN INVESTMENT IN THE COMPANY AND BEFORE PURCHASING ANY SHARES OF THE
COMMON STOCK OFFERED HEREBY. THIS PROSPECTUS CONTAINS FORWARD-LOOKING
STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES. THE COMPANY'S ACTUAL RESULTS
MAY DIFFER MATERIALLY FROM THE RESULTS DISCUSSED IN THE FORWARD-LOOKING
STATEMENTS. FACTORS THAT MAY CAUSE SUCH A DIFFERENCE INCLUDE, BUT ARE NOT
LIMITED TO, THOSE DISCUSSED BELOW.

DEVELOPMENT STAGE COMPANY

The Company is in the development stage, having had limited sales of and
limited revenues from its Ultra Guard systems. The Company is subject to the
risks, expenses, problems and difficulties frequently encountered in the
establishment of a manufacturing business, especially in the continually
evolving, intensely competitive, wastewater and water treatment industry. As of
July 31, 1997, the Company had, on a consolidated basis, total assets of
$987,012, total liabilities of $2,466,460 and total shareholders equity of
$-1,479,448. Even if the Company's development goals are achieved, which cannot
be assured, the Company may not become profitable at any time in the foreseeable
future.

COMPLIANCE WITH AGREEMENT WITH WORKING OPPORTUNITY FUND AND MDS VENTURES
PACIFIC, INC.

Under the terms of its 1996 agreement (as amended) with the Working
Opportunity Fund and MDS Ventures Pacific, Inc., pursuant to which the
Company will acquire the remaining outstanding equity interests in UVS, the
Company is required, among other things, to secure financing by September 15,
1997 in the amount of C$2,000,000 and to repay certain amounts loaned by WOF
and MDS to UVS (which at July 31, 1997 totalled $548,664). After September
15, 1997, the agreement will be automatically extended on a month to month
basis. If the financing is not obtained as required, unless the time for
completion is extended, the Company will forfeit its right to repayment of
funds it has advanced to UVS ($551,399 at July 31, 1997). See "Business:
Company Background".

COMPETITION

The Company competes with well-established water treatment companies, many
of which have financial, technological and marketing resources significantly
greater than those of the Company and may have established relationships with
customers or potential customers that afford them a competitive advantage. Some
of these

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competitors include, in the United States market, Trojan Technologies, Inc.,
Wedeco, Infilco-Degremont, Inc., Hanovia/Aquinonics, Inc., and Fischer-Porter/
Elsag Bailey, Inc. Although the Company believes that its Ultra Guard
systems can provide it a competitive technological advantage, that has yet to be
proven. Moreover, there can be no assurance that the Company's current UV
technology may not be rendered less effective or obsolete by UV and other water
treatment technologies developed by the Company's competitors. There can be no
assurance that the Company will be able to compete effectively in its current or
future markets or that competitive pressures will not adversely affect its
business, financial condition or results of operations.

CASH FLOW; FLUCTUATION IN OPERATING RESULTS; NEED FOR ADDITIONAL FINANCING

The nature of the Company's business may be expected to include a normal
lag time between the incurring of operating expenses and the collection of
contract receivables, which may be expected to be due largely from governments.
In addition, the Company is dependent for sales, other than those to a licensee
which is obligated to purchase agreed-upon system components from the Company,
on awards of water treatment system contracts for non-recurring projects. Also,
many of the Company's contracts may be expected to include provision for
retainage, entitling the other party to the contract to withhold, for a given
period of time, a specified portion of the payment until after completion of a
project. For these reasons, among others, the Company may experience periods of
limited working capital and may be expected to require financing for working
capital during those periods.

Because the Company's sales of Ultra Guard systems to governmental entities
may be expected to occur on an intermittent rather than consistent basis as
requests for proposal ("RFP") are issued and awards made, sales on both an
annual and quarterly basis are subject to fluctuations which are often beyond
the Company's control.

In addition, the Company requires and will require financing over and above
its current resources to sustain its operations and expand its marketing
efforts. There can be no assurance that the additional financing can be timely
obtained on terms acceptable to the Company, if at all.

RISK OF LONG-TERM, FIXED PRICE CONTRACTS

In connection with the sale of its wastewater treatment systems, the
Company expects to enter into contracts the performance of which can extend for
more than a year. The Company is required initially to bid most of these
contracts on the basis of a fixed price, incorporating all labor, materials, and
other costs which the Company may incur in performing the contract. To

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the extent that the Company underestimates those costs, or if the cost of
procuring a particular category of materials or services rises substantially
during the course of performance of a large contract, the Company could
experience reduced profitability or losses.

GOVERNMENTAL REGULATION

The Company's business and manufacturing are conducted from British
Columbia, Canada and are not subject to any special regulatory requirements not
applicable to manufacturing businesses in general in Canada and the United
States. Environmental regulations that apply to the sewage industry are
specific to the effluent being delivered to the receiving waters and must be
complied with by the wastewater treatment plant. In the United States,
wastewater and process water treatment plants must comply with clean water
standards set by the Environmental Protection Agency under the authority of the
Clean Water Act and standards set by states and local communities. Through the
RFP process, the regulations are passed on to the Company in the system design
requirements. These RFP's detail specifications for the system, including its
effectiveness as required to meet any regulatory requirements. Compliance with
microbiological standards is, however, determined by subsequent operation of the
wastewater treatment plant and is, unless the Company's treatment system failed
to comply with specifications for some reason (a problem the Company uses great
effort to avoid), generally the responsibility of the plant. However, it is
possible that the inaccuracy or inadequacy of those specifications and the
Company's potential liability if not indemnified, and the possibility that the
Company will be required to comply with future direct regulation of the Company
by future laws or regulations (including environmental laws), could materially
adversely affect the Company's business and operations.

The Company is not aware of any regulations which would adversely affect
its ability to market its systems; the effectiveness of the Company's system
enhances the Company's ability to respond to RFP's complying with the applicable
sections of the stringent regulatory clean water standards.

Because wastewater treatment systems require, in many jurisdictions
including the United States, permits from environmental regulatory agencies,
delays in permitting could cause delays in construction or usage of the
Company's systems by a customer, which, in turn, could have a material adverse
impact on the Company. In addition, many of the Company's customers will rely
on municipal financing for the purchase of the Company's UV systems. Sales to
these customers may be adversely affected by delays in obtaining, or the
unavailability of, such funds caused by budgetary constraints or the
bureaucratic process.

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COST OF INSTALLATION

The Company anticipates that its Ultra Guard systems may be installed as
replacement systems for existing disinfection systems, especially chlorinated
systems which the Company believes will be phased out because of their adverse
environmental impact. However, this potential business is dependent upon the
availability of funding for municipalities to replace or retrofit existing
systems, which cannot be predicted with any certainty.

AVAILABILITY OF COMPONENT MATERIALS

The Company's systems contain state-of-the-art components. The Company is
dependent upon third parties for the continuing supply of these components, two
of which, the lamps and the controllers, are obtained from sole suppliers. The
Company is in the process of identifying alternative suppliers for these
components; however, alternate sources with the quality, efficiency and price
the Company needs may be difficult to locate. Moreover, suppliers may
discontinue or upgrade some of the components incorporated into the Company's
systems, which could require the Company to redesign a system to incorporate
newer or alternative technology. Although the Company believes that it has
arranged for an adequate supply of components to meet its short term
requirements, the Company does not have contracts which would assure
availability and price. Lack of timely availability of components could cause
delays in installation of the Ultra Guard system and affect the Company's
revenues during certain periods as well as lead to customer dissatisfaction.
Limited availability of components could also require the Company to pay
premiums for parts to make installation deadlines and thus adversely affect the
Company's profit margin, or cause the Company to increase its inventory of
scarce parts and thus adversely affect the Company's cash flow. There can be no
assurance that the Company will continue to be able to obtain all of the
components it requires or that the price of certain components in short supply
will not materially and adversely affect its business, financial condition or
results of operations.

DEPENDENCE ON KEY EMPLOYEES

The success of the Company is largely dependent upon the Company's
President, Ken Fielding, and the Company's Chief Financial Officer, Secretary
and Treasurer, John Gaetz. The Company has no employment agreements with any of
these employees, nor does it carry key man insurance with respect to them. The
continued growth and prosperity and its ability to maintain its competitive
position and to a attract and service new business, depend to a large extent
upon its ability to retain its key employees and to attract additional qualified
personnel. Loss of the services of these employees could have a material
adverse effect on the Company's business. There can be no assurance that the
Company will

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be able to continue to retain or attract qualified personnel.

PRODUCTS DESIGNED FOR EXISTING AND ANTICIPATED STANDARDS AND GUIDELINES

The Company's products are developed to meet certain existing and
anticipated environmental, performance and operational standards and guidelines.
These standards and guidelines are continuing to develop and are subject to
change, largely in the past 10 years with respect to acceptable microbiological
discharge levels. The Company believes that its UV water treatment technology
is state of the art, that its research and development program will continually
enhance its water treatment systems, and that adjustment of its systems to new
microbial standards is uncomplicated and efficient and can be accomplished by
the addition of UV lamps to a system. Nevertheless, the possibility exists that
an unanticipated change which management does not now foresee in the standards
and guidelines could materially adversely affect the design, manufacture and
sale of the Company's systems.

PRODUCT LIABILITY

The Company's systems potentially may be subject to product liability or
commercial warranty claims. The Company does not have product liability
insurance. While the Company has never been the subject of any such claims,
considering the use of the Company's systems in large-scale municipal and
industrial water treatment systems, as well as the propensity of claimants
initially to pursue all possible contributors in a legal action, the lack or
insufficiency of product liability insurance could materially adversely affect
the Company's financial condition and ability to do business. There can be no
assurance that the Company will in the future be able to obtain coverage that
will be adequate to protect the Company from liability, or that the Company will
be able to obtain that insurance for premiums acceptable to the Company.

INTELLECTUAL PROPERTY RIGHTS

The Company, through UVS, owns patents on its ultraviolet lamp technology,
flow reactor chamber and discharge weir, and manufactures and markets its
products under those patents. No assurance can be given that the issued patents
will not be infringed or that patents the Company may apply for will be issued.
The costs of prosecuting an infringement suit can be very significant. If an
infringement occurs, no assurance can be given that the Company's exclusive
rights to the patented technology can be preserved or that its rights will be
protected, which could have a material adverse effect on the Company's business.
Also, it is possible that the Company may infringe patent, trademark, or
copyrights owned by others, license to which may not be available to the
Company. The expenses of defending claims through the

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prosecution of infringement actions vary and can be substantial. Some of the
Company's patented technology, such as the flow reaction chamber, was
developed as "work for hire" and, as such, can be subject to claim by the
individual(s) who developed it. The developer of the flow reaction chamber
has advised the Company that he believes that the U.S. patent has reverted to
him under the terms of the assignment to the Company. The Company vigorously
denies this assertion and believes that it is unfounded (and that, in any
event, other configurations could be readily used), but such claims could
impede the Company's ability to configure and sell UV Systems.

POTENTIAL DILUTIVE EFFECT OF OUTSTANDING WARRANTS AND OPTIONS

In connection with the acquisition of a majority interest in UV Systems
Technology, Inc. in December of 1996, the Company issued to two UVS
shareholders 1,200,000 warrants for Common Stock, exercisable at C$2.00 per
share over a period of four years. In April of 1996, pursuant to Regulation
S under the Securities Act of 1933 ("Securities Act"), the Company sold
38,000 shares of Common Stock and 38,000 each of B and C warrants,
exercisable at C$1.34 and C$2.00 per share, respectively, for a period of 2
and 3 years, respectively. In addition, from July 1996 through February
1997, the Company, pursuant to Regulation S sold a total of 336,420 shares of
Common Stock and 336,420 warrants to purchase Common Stock (exercisable over
a period of 2 years at an exercise price of $1.25. In June 1996, the Company
sold in a private placement 60,000 shares of restricted Common Stock and
60,000 warrants to purchase Common Stock (exercisable over a period of 2
years at a price of $1.25 per share). In addition, the Company has approved
an employee and consultant Stock Option Plan (the Plan covered by this
Prospectus) pursuant to which options for up to 1,588,000 shares of the
Company's Common Stock could be issued. As of July 31, 1997, no options had
been issued under the Plan. These outstanding warrants and options could
negatively influence the Company's ability to raise additional equity capital
in the future. To the extent that these warrants and options to purchase
Common Stock are exercised, there will be additional dilution in excess of
that resulting from use of common shares in earnings calculations.

As of July 31, 1997, the Company had 2,142,420 vested warrants outstanding.

LIMITED PUBLIC FLOAT; TRADING; VOLATILITY OF STOCK PRICE

The Company's Common Stock is traded in the over the counter market. While
a public market currently exists for the Company's Common Stock, the number of
shares in the public market is approximately 44% of the 6,897,770 shares of
Common Stock that will be outstanding at the completion of this offering.
Trading volume in the four weeks ended October 1, 1997 averaged 33,610 shares
traded per day.

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Thus, trading of relatively small blocks of stock can have a significant impact
on the price at which the stock is traded. In addition, the over the counter
market has experienced, and is likely to experience in the future, significant
price and volume fluctuations which could adversely affect the market price of
the Common Stock without regard to the operating performance of the Company.
The Company believes factors such as quarterly fluctuations in financial
results, announcements of new technologies impacting the Company's systems,
announcements by competitors or changes in securities analysts' recommendations
may cause the market price to fluctuate, perhaps substantially. These
fluctuations, as well as general economic conditions, such as recessions or high
interest rates, may adversely affect the market price of the Common Stock.

SHARES ELIGIBLE FOR FUTURE SALE

Future sales by existing shareholders could adversely affect the prevailing
market price of the Common Stock. Upon completion of the offering, the Company
will have 6,897,770 shares of Common Stock outstanding. Of these shares,
approximately 676,420 shares will be eligible for sale in the public market
without restriction pursuant to Rule 144(k) or Regulation S under the
Securities Act. Approximately 934,918 additional shares outstanding upon
completion of the offering will be eligible for sale pursuant to Rule 144.

ABSENCE OF DIVIDENDS

Since its inception, the Company has not paid cash dividends on its Common
Stock. The Company intends to retain future earnings, if any, to provide funds
for business operations and, accordingly, does not anticipate paying any cash
dividends on its Common Stock in the foreseeable future.

BUSINESS

THE COMPANY

The Company, through its majority-held subsidiary UV Systems Technology,
Inc. ("UVS"), is the manufacturer and marketer of state-of-the-art ultraviolet
disinfection systems for wastewater. The Company is committed to development
and commercialization of superior, cost-effective environmentally friendly,
ultraviolet-based water treatment systems. Through UVS, the Company holds two
United States patents and five international patents on various components of
its Ultra Guard-TM- ultraviolet disinfection system, including the flow reactor
chamber and its discharge weir.

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in this document to the "Company" include its consolidated majority-owned
subsidiary, UVS, unless the context otherwise requires.

COMPANY BACKGROUND

Incorporated in Nevada in August 1990, the Company was inactive until it
was acquired in July, 1995 by eight Canadian and European individuals. The
investors intended to develop the Company into the United States marketing
arm for UVS' Ultra Guard systems. The Company issued 1,600,000 shares of its
restricted common stock ("Common Stock") to certain individual stockholders,
including an officer of the Company, as reimbursement of cash advanced by them
to others for expenses related to the acquisition.

In furtherance of the Company's marketing objective, the Company
entered into an oral agreement, subsequently supported by a written agreement
dated September 21, 1995, for marketing rights for the Ultra Guard system in
eight Western states. Thereafter, in July 1996, the Company entered into a
funding agreement with UVS pursuant to which the Company supplied 50% of UVS'
operating capital for a six-month period during which the two companies
structured an agreement to complete an acquisition by the Company of UVS.
During the period August 1996 through December 7, 1996, the Company acquired
50.69% of the outstanding UVS common stock, from two principals and certain
minority shareholders. On December 6, 1996, UVS, the Company, the two former
majority shareholders of UVS and the two remaining minority shareholders of
UVS, Working Opportunity Fund ("WOF") and MDS Ventures Pacific, Inc. ("MDS")
entered into an agreement, subsequently amended on April 11, 1997 and August
8, 1997, for SSI to acquire the remaining 49.31% of outstanding UVS common
stock and retire or convert their preferred stock, contingent on securing
additional financing by September 15, 1997. After September 15, 1997, the
agreement will be extended automatically on a month to month basis. The
agreement provides, INTER ALIA, that, (a) the Company will raise at least
C$2,000,000 in equity financing for UVS, (b) each of WOF and MDS will convert
half of their UVS preferred stock to secured debentures, to be redeemed from
each of them by UVS at the rate of C$25,000 per month, or fully redeemed at
UVS' option (in which case, WOF and MDS may convert the outstanding balance
into Company Common Stock at a rate of C$2.00 principal amount per share),
(c) the remaining 50% of UVS preferred stock held by WOF and MDS will be
converted into 500,000 shares of Company Common Stock , (d) additional loan
amounts owed to WOF and MDS (approximately C$548,664 as of July 31, 1997)
will be repaid out of the financing or may be converted by WOF and MDS into
Company Common Stock at the rate of C$2.00 per share, (e) all shares of
Company Common Stock issued will carry a detachable warrant certificate
entitling the holder to purchase, during a four-year period from issuance of
the Common Stock, one Common Share for each share issued, at a price of
C$2.00 per share, (f) as long as the secured debentures are outstanding, each
of WOF and MDS

11
<PAGE>

may appoint one Director to the Company's Board of Directors, (g) the UVS common
stock held by WOF and MDS will be transferred to the Company when the financing
has occurred and the additional loan amounts have been repaid to WOF and MDS,
(h) the Company will ensure that the issued Common Stock will be or become free-
trading, and (i) if financing is not obtained, the Company will forfeit any
funds advanced by the Company to UVS (which, as of July 31, 1997 were
approximately C$551,399).

INDUSTRY BACKGROUND

The treatment of municipal wastewater and drinking water to eliminate
contaminants injurious to health and the environment is a worldwide concern. In
1995, the world spent $335 billion for the purification of drinking water,
wastewater treatment and treatment of industrial process water and fluids. By
2000, world spending for drinking water purification and municipal wastewater
treatment only is estimated to reach $300 billion per year (plus another $200
billion for industrial treatment needs). In the United States alone, in 1984 a
United States Environmental Protection Agency survey reported that 15,378
municipal treatment plants were in operation and projected the number to
increase to approximately 21,000 by the year 2000. Of these 15,378 operating
in 1984, some of which had either limited or no disinfection, only 107 were UV
systems. Only 107 of the reported plants in 1984 utilized, or were being
constructed and designed for, UV treatment. Many of the existing plants
identified in 1984 will require upgrading, retrofitting or replacement to
meet new United States environmental standards, at an estimated cost of more
than $180 billion. These, together with the new treatment plants projected
to be built, represent the United States municipal wastewater treatment
market for the UV treatment industry.

Typical municipal treatment plants begin the treatment of effluent by
settling or filtering out solid wastes. Thereafter, the water must be
disinfected. Of the five major factors used to evaluate a disinfection system,
four factors, effectiveness, use cost, practicality, and pilot study
requirements, relate to the disinfection process itself. The fifth factor,
potential adverse effects, relates to the effect of the disinfectant on the
environment. Currently, the majority of treatment systems in the United States
use chlorination. Other treatment alternatives include, INTER ALIA, ozonation
and ultraviolet light.

The use of chlorination can raise significant environmental concerns.
According to a 1986 U.S. Environmental Protection Agency study, MUNICIPAL
WASTEWATER DISINFECTION, because of the toxicity of chlorine residuals at low
levels and the relatively high limit of detection of chlorine residual test
procedures, control of chlorine-induced toxicity in the receiving stream is
difficult. Environmental factors such as temperature, pH, alkalinity,

12
<PAGE>

suspended solids, chemical oxygen demand and nitrogen containing compounds
influence the effectiveness of chlorine disinfection. Adverse environmental
impact can include the toxicity of residual chlorine to wildlife and the
formation of potentially toxic halogenated organic compounds. Many treatment
plants use sulfur dioxide to dechlorinate treated water. This reduces the
amount of toxic residuals, but probably does not affect halogenated organics and
adds its own negative effect in the receiving water. Transportation of chlorine
raises additional concerns because it is extremely volatile and hazardous and
is, therefore, difficult to transport safely. In many states, regulations
require that all personnel in a treatment facility which uses chlorine be
trained in correct handling and safety procedures.

Ozone, an unstable gas, is an extremely reactive oxidant and a very
effective bactericide and virucide which is thought to be beneficial to the
environment. However, in some instances, mutagenic and/or carcinogenic
compounds have resulted from ozone's use. Ozone treatment can be expensive;
ozone must be generated on-site in an expensive process, the ozonation
process is relatively complex to operate and maintain, and the equipment
costs are high.

According to a recent study, ULTRAVIOLET DISINFECTION IN MUNICIPAL WATER
AND WASTEWATER, the number of UV disinfection systems in the United States will
increase from about 1,000 to about 3,000 between 1995 and 2000 and the market
will increase from $20 million annually to $100 million annually in the same
time period. By the year 2010, half of municipal disinfection systems are
expected to use technologies other than chlorine, and use of chlorine will be
almost eliminated by 2025. About 56% of chlorine alternative installations are
forecast to be UV systems.

Ultraviolet (UV) light treatment is a non-chemical process the
effectiveness of which as a bactericide and virucide has been well-established.
Radiation at a wavelength of 254 nm penetrates the cell wall and is absorbed by
the cellular nucleic acids, preventing replication of the cell. Because UV is
non-chemical, no toxic residues are produced. UV systems are simple to operate
and maintain, have almost no adverse environmental impact, and have minimal
space requirements. UV is a cost-effective alternative to chlorination and
ozonation.

The installation of UV disinfection systems has been slowed by the large
number of low pressure, low intensity ultraviolet lamps required in larger
treatment plants, the need to develop better cleaning methods for the UV lamps
used in the systems, the cost of power consumption (because of the large numbers
of lamps) and the labor cost of annual replacement of the lamps, and a reduction
in disinfection performance which can result from high suspended solids
concentrations, color, turbidity, and soluble organic matter which reduce the
ability of the ultraviolet light to penetrate the fluid (the transmittance of
the fluid). The Company believes that

13
<PAGE>

a UV system such as provided by the Company which deals with these issues will
greatly enhance the marketing opportunities for UV systems as a result of the
desire for treatment systems which are environmentally friendly, cost-effective
and efficient.

SERVICE SYSTEM'S STRATEGY

The Company is committed to a legacy of a healthy planet for future
generations through the development and commercialization of superior, cost-
effective, environmentally friendly, UV-based water treatment systems. The
Company's objective is to become a leading supplier of UV disinfection systems
for municipal wastewater and, eventually, for industrial process water and
potable water. The Company believes that sensitivity to the environmental
effects of current widely-used chlorine treatment and the corresponding need for
superior, environmentally friendly, efficient, and cost-effective systems for
water disinfection around the world provide numerous opportunities for the
Company to expand the scope of its activity, utilizing its state of the art,
proprietary UV technology. Key elements of the Company's strategy are:

TECHNOLOGICAL SUPERIORITY. The Company currently holds patents on the UV
lamps, flow control module and flow-balanced weir, components which are used in
its treatment system. The system also features several proprietary features
which address and correct the perceived problems with respect to cleaning of
lamps and variation of intensity for reduction of power consumption and for
treatment of different degrees of pollution. The Company intends to improve
continuously its UV systems through technological development in response to the
expanding needs and applications of the water and wastewater treatment industry.

EXPANSION OF PRODUCT LINES. The Company's UV technology has the capacity
to be applied to many treatment uses. Subject to adequate financing and
successful penetration of the wastewater disinfection market, the Company's
goal for the next decade is to expand from its current emphasis on wastewater
disinfection to the industrial process water and potable water treatment, other
fluids treatment and air treatment. Process water treatment is required in
industries such as breweries, soft drink producers, pharmaceutical, pulp and
paper production, agri-businesses, fisheries, and marine life systems.
Potable water treatment is needed for drinking water for normal municipal
supply, bottled water and for disaster relief. Treatment is also needed in
bottled and packaged fluids and air conditioning systems.

ENHANCEMENT AND EXPANSION OF MARKETING EFFORTS. Marketing of the Company's
UV systems is largely through agents and representatives in North America and
world-wide. To cover more

14
<PAGE>

regions and to enhance customer support, the Company is intending to expand this
network and to acquire firms serving a similar industry.

EXPAND INTERNATIONAL SALES. While awareness of the need for water
disinfection in North America is high, that awareness in other parts of the
world is also beginning to increase and the market for treatment systems is
expanding. Because of the compact and adaptable nature of the Company's
treatment system, its patented and proprietary technology, and its full-size
demonstration units, the Company believes that it has good potential to expand
increasingly into the international market and intends to pursue this market
aggressively.

THE COMPANY'S PRODUCT

Through UVS, the Company manufactures and markets its Ultra Guard UV water
treatment system. The Ultra Guard system incorporates patented UVS
low-pressure, high intensity, high efficiency UV lamps, infinitely variable
ultraviolet lamp controllers, patented UVS high-performance flow control
modules, patented flow-balanced weirs, and an automatic quartz sheath cleaning
system. Currently used primarily for municipal wastewater disinfection, the
system can also be adapted for treatment of process and wastewater from
industry, where it is currently being applied in the semi-conductor industry,
treatment of potable water, juices and other bottled products, and agriculture
and aquaculture water treatment.

UV disinfection systems have the advantage of being relatively simple to
operate and maintain. UV disinfection is a physical, rather than chemical,
process using UV radiation to permeate bacterial and viral cell walls and
prevent the cells from replicating. In competing systems, after solid materials
are removed, the effluent is directed through banks of low pressure, low
intensity mercury vapor arc lamps producing UV light. In order to disinfect a
liquid, the energy must be directed into the liquid as efficiently as possible.
As the lamp emits radiation and the distance from the lamp increases, the
intensity and the effectiveness of the UV diminishes. Traditionally, maximum
exposure has been obtained by utilizing a very large number of low pressure, low
intensity lamps through which fluid passes. Murkier fluids require more lamps
and closer placement of the lamps in proximity to one another.

The Company's Ultra Guard system also exposes fluid to UV light for a time
sufficient to damage the microorganisms effectively. However, in the Ultra
Guard system, fluid passes through a diffuser plate, which evens the flow, then
passes through a patented flow reaction chamber where the UV lamp is located,
and leaves through the proprietary flow-balanced discharge weir.

15
<PAGE>

As effluent enters the intake channel, uneven fluid pressure has, in
earlier non-Ultra Guard systems, created variances in the flow rate among the
top, middle and bottom layers of influent, which may result in varying rates of
disinfection as flow past the UV lamps varies. Ultra Guard's diffuser screen
intercepts the inflow, mixes the layers and ensures uniform column flow,
allowing the lamp intensity to be based on a consistent, predictable flow rate.
A flow-pacing device determines the volume of effluent flowing toward the
disinfection modules. A UV transmission monitor provides continuous readings of
the effluent transmission quality, which are fed to the system control center
where they are analyzed to select appropriate power settings for UV lamp
intensity. In multichannel installations, powered flow-control gates can be
provided to balance the flow, control the number of modules in operation, or
take a channel off-line for routine maintenance or lamp replacement.

After passing through the diffuser screen and monitors, the fluid enters
the Ultra Guard patented flow-reaction chamber. This process replaces the
Company's competitors' straight-through systems that require repeated and
continuous exposure to multiple banks of UV lights. With the Ultra Guard
system, the fluid oscillation ensures that all influent receives maximum
exposure to the UV light from a single lamp. Also, unlike lamps in other
systems which are exposed to influent and build up sedimentary deposit, the
Ultra Guard chamber is designed to cause the fluid to pass closer to the UV
light and minimize sedimentary deposit on the quartz sleeve, reducing the need
to remove the lamps for cleaning and allowing the lamps to continue to operate
at peak efficiency for longer periods of time. In addition, Ultra Guard has a
mechanical quartz sheath cleaner incorporated into its system which simplifies
and automates the cleaning process. The combination of the reduced
sedimentation and fouling and the automatic cleaning system directly addresses
one of the major concerns about the use of UV disinfection systems. The Company
believes that this advance will significantly aid its marketing efforts.

The Ultra Guard patented low-pressure, high intensity, high efficiency UV
lamps emit UV light to penetrate murky effluent and reduce fecal coliform
counts to acceptable levels. The lamps operate at 40-60% of the operating costs
of the more commonly used low-pressure, low-intensity lamps. The Ultra Guard
system also requires up to 90% fewer lamps than most other systems, reducing
total electrical consumption even more. Replacement downtime for lamps is
minimized because the lamps can be replaced quickly from above while the lamp
module remains in the channel. Using data from the in-stream flow sensors and
UV monitors, UV output for each lamp can be increased or decreased to account
for unusual quartz sheath fouling and lamp aging. Conventional flap gates and
imbalanced weirs often cause UV lamps to be exposed to air, an energy
inefficiency. The Ultra Guard patented flow-balanced weir, based on the
principle of atmospheric pressure equalization,

16
<PAGE>

maintains correct channel depth without movable gates, valves, or other methods
requiring operator involvement or special sensors.

The Ultra Guard system has a compact size. Capacity can be easily
increased by expanding the number of channels operating in parallel. For more
turbid than normal influent or more stringent than standard effluent
regulations, a second lamp module immediately behind the first may be installed.
The system can handle flows from 1 gallon to 10 billion gallons per day.
Systems are customized to suit specific site conditions and discharge
requirements. Single lamp systems cost between $8,000 and $15,000; the cost of
systems requiring more lamps is a multiple of that, with volume discounts
available for larger sales. Typical systems require one lamp for every 0.5
million gallons of wastewater treated.

CUSTOMERS

The Company's customers to date have primarily been municipal wastewater
treatment facilities. Ultra Guard systems have been installed at two wastewater
treatment facilities. The first system was commissioned in February 1995 in
Paraparaumu, New Zealand and has been in operation since that time. This
municipal wastewater treatment system is designed to treat 580 cubic meters per
hour peak flow and is a 12 lamp system. Initially, the system experienced
premature lamp burnout in the center sleeve due to an defective lamp controller.
This problem has been corrected. The second Ultra Guard system was supplied in
August 1995 for Chilliwack, British Columbia, Canada and is a 12 lamp system
designed to process a flow of 4.5 million gallons per day (MGD). After testing
and adjustment, the system is ready for commissioning pending resolution by the
customer of the excessive flows through the plant, up to 8.6 MGD being delivered
to the system. The Company has agreed to reverse the sale for this interim
period and is structuring an agreement with the customer to continue using the
site as a facility to test new equipment and components. The sale is subject to
the City receiving approval for additional funding to cover the cost of the
additional equipment needed to disinfect the higher flows. As of July 15, 1997,
the Company had delivered 10 systems to its Japanese distributor for
applications in the semiconductor industry and had orders for an additional 10
systems.

UVS has agreed to deliver a production demonstration unit ("PDU") for
effluent testing to two sites in Hong Kong and one in Washington State slated
for upgrade to UV disinfection. Testing at the Washington State site is
scheduled to begin in late October 1997 and the first Hong Kong site is
scheduled for October 1997. The Company actively bids on new sites in the
United States and elsewhere. In addition, through its distributorship
agreement with Chiyoda Kohan Col, Ltd. in Japan, the Company has sold UV
lamps and controllers for use in industrial production process water
disinfection in the semi-conductor industry.

17
<PAGE>

SALES AND MARKETING

The Company markets the Ultra Guard system both domestically and
internationally through UVS. UVS markets the system directly, through two
marketing employees with specialized training in wastewater disinfection, and
through a network of distributors and representatives. As of June 15, 1997, UVS
had 31 distributors and representatives, 18 in North America and 13
internationally. Distributors purchase systems and components for resale in a
designated territory on an exclusive basis and provide full service to
customers. Some agreements require a distributor to purchase a minimum amount
of product each year. Distributorship agreements are performance related and
usually have a term of one year. Sales representatives act as agents for UVS to
sell UVS systems in designated territories. Representatives are paid a
commission for sales made within their territories. The usual contract is for a
period of one year. The Company, through UVS, is continuing to recruit
distributors and representatives throughout the world through strategically
placed advertisements in international publications and through attendance at
international exhibitions such as Globe Foundation, which exhibits bi-yearly UVS
is registered for the exhibition at Vancouver, Canada in March 1998.

As of June 15, 1997, the Company had sold all of its products outside the
United States. It anticipates, however, that its marketing network in the
United States, together with its state of the art technology, will enhance its
opportunities for sales there and that the United States, with its significant
number of publicly-owned treatment works, will become its primary market. The
Company expects that its sales will be to diverse wastewater treatment plants in
the United States and world-wide and, therefore, other than for initial sales,
no one customer is likely to account for more than 10% of its sales, averaged
over a five-year period. Because of the size of each project, one project may
be expected to represent more than 10% of sales in any given year. The Company
is targeting communities of all population sizes.

As part of its sales effort, the Company has assembled 7 production
demonstration units ("PDU's"). Of these, one is used by the Company for
research and development, the Company has received deposits (from agents to
use as demonstration units) for two more and four are awaiting conversion
from single lamp to two lamp systems. PDU's are fully functional Ultra Guard
systems with all of the patented components which are available for IN SITU
testing. They are compact in size and designed for placement next to an
existing outflow channel. PDU's can accommodate flow rates from 100 to 800
U.S. gallons per minute, about 8% of the average wastewater treatment plant
flow. An inflow pump draws fluid from the existing system discharge at the
flow rate required for testing in order that the PDU operates, in effect, as
part of the treatment system. The testing period generally runs from two to
three weeks in duration and is operated by the Company's technicians. In
some instances, the staff of the

<PAGE>

treatment site or the site design engineer's staff operates the PDU.

The Company advertises through trade publications directed to wastewater
treatment, the marketing efforts of its distributors and representative,
presentation of technical papers at industry meetings, meetings with engineers
and others involved in treatment plant design, and its world-wide web site.
Video tapes and brochures are available for potential customers and for use by
distributors and representatives. Many of the marketing opportunities for
wastewater treatment systems are made available through "requests for proposal"
from public entities and contractor and engineering firms acting for public
entities for systems designed in response to specific criteria. The Company
actively responds to RFP's in the United States and throughout the world. As of
August 31, 1997, the Company had eight responses to RFP's pending. The
Company actively responds to RFP'S at a rate of approximately three a week.

COMPETITION

The Company competes with producers, many of whom are more established and
have significantly greater resources than the Company, of other UV water
treatment systems and with producers of other water treatment technologies.
Other major technologies currently in use include chlorination, chlorination and
dechlorination, and ozonation. Competitive factors include effectiveness, use
cost, practicality, pilot study requirements and potential adverse environmental
effects.

Of all of the disinfection technologies, including UV, in use, the most
prevalent is chlorination (or chlorination with dechlorination). Chlorination
has been the predominant treatment modality in municipal wastewater and
industrial process water systems in the United States and world-wide, are
chlorine-based systems. However, because of environmental concerns, the Company
expects the use of chlorine to decrease significantly over the next three
decades. An industry survey has forecasted that over half of chlorine
alternative installations will be UV. See "--INDUSTRY BACKGROUND."

In the Company's primary business of wastewater and process water
treatment, the Company competes primarily with producers of chlorination
disinfection systems and with other UV system manufacturers. While it also
competes with ozonation systems, ozonation is more commonly used for drinking
water purification.

Wastewater and process water disinfection system manufacturers with which
the Company competes include, in the United States market, Trojan Technologies
Inc., Wedeco, Infilco-Degremont, Inc., Hanovia/Aquionics, Inc., and
Fisher-Porter/Elsay Bailey, Inc., estimated to represent, respectively, 50%,
20%, 13%,10% and 7% of

19
<PAGE>

the world-wide market, of which about 80% are United States-based sales. Trojan
focuses on UV applications for use in the sewage wastewater industry. It
produces the only product (the UV4000) which directly competes with the
Company's low pressure, high intensity lamps, and open channel system. The
Company believes, however, that the Company's systems are technologically
superior to Trojan's. Trojan has reported its sales as of its 1996 fiscal year
end to be $35,309,085. Hanovia competes primarily in the potable water European
market. Infilco-Degremont, Wedeco and Fisher Porter sell UV systems of the low
pressure, low intensity type but do not have the high-intensity lamps preferred
for sewage wastewater effluent treatment.

Compared to competing systems, the Company's Ultra Guard systems are
more compact and use less land area, consume 40 to 60% of the electrical
power used in low pressure, low intensity systems and 15 to 60% of the
electrical power used in Trojan's UV4000, and, therefore, have lower
life-cycle operating costs. The Company's systems treat very poor quality
effluents, have better hydraulic performance, can be demonstrated using a
full-scale, single lamp unit, and have an automated lamp cleaning system.
All these factors combined provide, the Company believes, substantially
better quality discharge in terms of total fecal coliform concentrations, and
reduce capital and operating costs compared to competitors.

PATENTS AND TRADEMARKS

The Company, through UVS, holds patents to key components of its Ultra
Guard systems. These include United States and Patent Cooperation Treaty
patents on the UV sterilizer system and the weir, as well as patents on the UV
lamp technology in the United States, France, Canada, the United Kingdom, the
Netherlands, Germany, Japan, and Switzerland. The patents on the lamps expire
at various times before the year 2000; however, due to the technology and cost
involved in manufacturing the lamp and the compatible electronics needed to
operate the lamps, the Company believes that the expiration of the patents
should not materially affect the Company's business. With the patents the
Company holds on other key components in the Ultra Guard system, competing
systems, even if they use the Company's lamps, would operate at about 50% of the
treatment capability of the Company's system. The patents on the other patented
key components were recently issued in the United States and will extend into
the year 2018. Some of the Company's patented technology, such as the flow
reaction chamber, was developed as "work for hire" and, as such, can be subject
to claim by the individual(s) who developed it. The developer of the flow
reaction chamber has advised the Company that he believes that the U.S. patent
has reverted to him under the terms of the assignment to the Company. The
Company vigorously denies this assertion and believes that it is unfounded, but
also believes that, in any event, other configurations could be readily

20
<PAGE>

used.

In addition, the Company holds registered trademarks on "ULTRAGUARD" and on
its "wavy lines and design" logo in the United States and Canada.

REGULATORY MATTERS

21
<PAGE>

MANUFACTURING

The Company's Ultra Guard systems are assembled at its UVS facility.
Components for the systems are manufactured by a variety of Canadian, United
States and international suppliers. The Company obtains its UV lamps and
controllers for the systems from a sole supplier for each. To ensure against
any interruption of supply should one of these suppliers be unable or unwilling
to provide the parts as required, the Company is in the process of identifying
and arranging for alternative sources for these components.

RESEARCH AND DEVELOPMENT

The Company considers its research and development efforts to be a key
component of its business strategy. As of August 16, 1997, the Company,
including UVS, had twelve employees, with a combined 125 years of related
experience, collaborating on product development activities. The Company also
used lamp design and computer software consultants to assist in product
development decisions. The Company's current research and development efforts
are focused on alternative sheath cleaning technology, including the use of
ultrasonic methods, and on systems automation. Future efforts will focus on
expanding and developing the Ultra Guard technology and equipment for
applications, such as industrial process water treatment units, in addition to
sewage effluent disinfection. On a combined basis assuming the acquisition of
the majority of UVS outstanding common stock had occurred, the Company's
research and development expense in fiscal 1996 was $513,175 and was $322,825 to
July 31, 1997.

EMPLOYEES

As of August 16, 1997, Service Systems had one full-time employee, and UVS
had 11 full-time employees. The Service Systems employee was engaged in
management. The UVS employees were engaged in production, design, and
development of the Ultra Guard systems and technology and in office services for
the business.

PLAN OF OPERATION

The Company intends to market its Ultra Guard system aggressively during
the next year and thereafter. Among other things, it plans to expand its base
of sales representatives, agents and manufacturing licensees from the 31
worldwide as of June 15, 1997 by pursuing agency inquiries from countries where
the Company is not currently represented. The Company believes that its most
significant short-term market potential is in North America, where awareness of
environmental protection and preservation is high and where ultraviolet
treatment of wastewater and process water is an accepted alternative to chemical
disinfection. In the United States, where the Company currently

22
<PAGE>

has 18 sales representatives and agents, the Company plans to add at least 5
additional such persons. The Company also intends to continue its sales efforts
outside of North America. Hong Kong has plans to upgrade and install UV at
three wastewater treatment plants. The first plant is currently out for a firm
bid (tender) due by October 17, 1997, the second in 1998 and the third in
1999. The Company's Ultra Guard PDU will be installed for testing at the first
of the other two sites in the fall of 1997. Testing should be completed before
November 30, 1997. The Company is one of two bidders qualified for the tender
due in October for this $1.5 million project. Should the Company be selected
for the October project, it should have greater opportunity for award of the
additional two projects. The total value of these projects is estimated to be
in excess of $7 million.

As part of its continuing research and development efforts, the Company
expects over the next 12 months to expand its efforts into adapting the Ultra
Guard technology and system to potable water and process water treatment
systems. The market for these systems combined is estimated to be the size of
the sewage treatment market, or about $100 million annually in the United States
by the year 2000.

The Company plans to finance its operations over the next 12 months through
further financing, either debt, equity or a combination. Sales revenues from
sale of systems and components are not expected to contribute to operations
support until about January 1998 as no agreements to purchase of systems were in
place as of July 31, 1997 and the number of components to be purchased by the
Company's licensee, Chiyoda Kohan, pursuant to its license had not yet been set
for the second and third year of the license, although negotiations are ongoing
for UV lamps and control systems the estimated value of which is $5.6 million.
If no sales are made and no financing is obtained, which the Company does not
expect, the Company's ability to continue in business would be severely
impaired.

In addition to the Hong Kong project, the Company as of July 15, 1997,
was providing drawings and specification information to design consultants on
four projects in North Carolina, valued at about $2 million, including a
project where a PDU demonstration was successfully conducted. The Company
expects to learn if the projects will be awarded to it, which it cannot
assure, by October 31, 1997.

In addition to the independent sales representatives and agents which the
Company plans to add and subject to the Company's receipt of financing and sales
of Ultra Guard systems, the Company expects that it will employ two additional
persons in design and engineering, two additional persons in marketing, and
additional personnel in manufacturing assembly and support as required by the
volume of orders received.

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<PAGE>

The Company has been negotiating with its UV lamp supplier to reduce the
lamp cost. Based on specific order volumes which the Company believes will be
its needs for the next 12 months, the Company will receive a 43% price
reduction. This percentage equates to an 11% cost saving for each single lamp
system and should help to enhance the Company's competitive position. Over the
next months, the Company will continue negotiations with other suppliers to
assure long term supply and arrange for cost reductions based on order volumes.

PROPERTIES

The Company's executive officers were moved in July 1997 from White Rock,
British Columbia, Canada, into the UVS premises at 2800 Ingleton Avenue,
Burnaby, British Columbia. The Company also leases, on a month-to-month basis,
an office maintained by two consultants in an office complex in Phoenix,
Arizona.

The UVS leased premises have 2,537 square feet of executive offices and
9,088 square feet of manufacturing facilities. The lease term is for a period
of five years, expiring September 2000, with an option to renew for an
additional five-year term. The Company anticipates that these facilities will
be adequate for five years, with a need for additional storage space in year
three.

The Company maintains an insurance plan covering all of its facilities and
contents, as well as general liability insurance in an amount considered
adequate in the industry (although no assurance can be given that the amount
will, in fact, be sufficient should a claim arise).

SELLING SHAREHOLDERS

The following table sets forth the names of the Selling Shareholders who
are eligible to resell (whether or not they have a present intent to do so)
and the positions, offices and other material relationships which each
Selling Shareholder had with the Company or any of its predecessors or
affiliates since September 1, 1995:

Selling Shareholder Position With the Company
Since September 1, 1995

John R. Gaetz Vice President, Secretary
(1997---), Director (1997---)
Director, Vice President,
Secretary of UVS (1995---)

Kenneth E. Fielding President (1995---), Director
(1995---), President of UVS
(1996---)

The following table sets forth the name of each Selling Shareholder as of
September 25, 1997, the number of Shares issuable upon exercise of options
granted under the Plans, the number of Shares eligible to be sold by each
Selling Shareholder pursuant to this Registration Statement and the
percentage of outstanding Common Stock to be owned by each Selling
Shareholder after the offering. Selling Shareholders may receive additional
shares under the Plan and may sell those shares. The ** indicates less than
one percent of outstanding after this offering.

<TABLE>
<CAPTION>
Number of Percent of
Number of Shares Eligible Total Shares
Name of Owner Shares Owned to be Sold Outstanding(4)
- ------------- ------------ --------------- --------------
<S> <C> <C> <C>
Kenneth E. Fielding(1) 247,057(2) 200,000 0.9%

John R. Gaetz(1) 1,472,770(3) 200,000 21.6%

Len Baumberger(1) 100,000 100,000 **

Erlinda De Abreu(1) 10,000 10,000 **

Jeanne Lalonde(1) 5,000 5,000 **

Gary Fielding(1) 10,000 10,000 **

Feridoon Shamlou(1) 10,000 10,000 **

Martin Smith(1) 20,000 20,000 **

Barry Stadey(1) 20,000 20,000 **

Olinda W. Swinton(1) 5,000 5,000 **

David J. Thompson(1) 10,000 10,000 **

Leo Vasey(1) 12,000 12,000 **

A. Janeen Curtis(1) 200,000 200,000 **

Diane Smith(1) 200,000 100,000 **

Don Lindsay(1) 75,000 75,000 **

Joshua Ward(1) 25,000 25,000 **

Trond E. Matteson(1) 25,000 25,000 **

Peter Colak(1) 50,000 50,000 **

Shaniqua R. McPhee(1) 200,000 200,000 **

</TABLE>

(1) The address for the shareholders is in care of the Company at 2800
Ingleton Avenue, Burnaby, B.C. Canada V5C 6G7.

(2) 7,000 of these shares are owned by Mr. Fielding's minor daughter.

(3) Includes 620,000 shares which Mr. Gaetz has the right to acquire at a
price of c$2.00, under immediately exercisable warrants and 33,770 shares
owned by Mr. Gaetz' wife.

(4) A person is deemed to be the beneficial owner of securities that can be
acquired by that person within 60 days from the date of this Registration
Statement upon exercise of options or warrants. Each beneficial owner's
percentage ownership is determined by assuming that options or warrants that
are held by that person and that are exercisable within 60 days from the date
of this Registration Statement have been exercised.

PLAN OF DISTRIBUTION

The option holders, or their pledgees, donees, transferees or other
successors in interest, may sell Shares in any of the following ways: (i)
through dealers, (ii) through agents, (iii) or directly to one or more
purchasers. The distribution of the Shares may be effected from time to time in
one or more transactions (which may involve crosses or block transactions) (a)
in the over-the-counter market, or (b) in transactions other than in the
over-the-counter market, or in a combination of those transactions. Any such
transaction may be effected at market prices prevailing at the time of sale, at
prices related to those prevailing market prices, at negotiated prices or at
fixed prices. The option holders, or their pledgees, donees, transferees or
other successors in interest, may effect these transactions by selling Shares to
or through broker-dealers, and those broker-dealers may receive compensation in
the form of discounts, commissions, or commissions from the option holders, or
their pledgees, donees, transferees or other successors in interest, and/or
commissions from purchasers of Shares for whom they may act as agent. The
option holders, or their pledgees, donees, transferees or other successors in

24
<PAGE>

interest, and any broker-dealers or agents that participate in the distribution
of Shares by them might be deemed to be underwriters, and any discounts,
commissions, or concessions received by any such broker-dealers or agents might
be deemed to be underwriting discounts and commissions, under the Securities
Act. Affiliates of one or more option holders, or their pledgees, donees,
transferees or other successors in interest, may act as principal or agent in
connection with the offer or sale of Shares by the option holders, or their
pledgees, donees, transferees or other successors in interest. In addition, any
Shares which qualify for sale pursuant to Rule 144 under the Securities Act may
be sold under Rule 144 rather than pursuant to this Prospectus. The Company
will not receive any of the proceeds from the sale of the Shares, although it
will pay the expenses in preparing the Registration Statement and registering
the Shares. The Company does receive proceeds from the issuance of Shares to
the option holders, or their pledgees, donees, transferees or other successors
in interest, upon their exercise of the options. The option holders have been
advised that they, and their pledgees, donees, transferees or other successors
in interest, are subject to the applicable provisions of the Securities Exchange
Act of 1934, including without limitation Rules 10b-5, 10b-6, and 10b-7
thereunder.

DESCRIPTION OF COMMON STOCK

The description of the Company's common Stock to be offered pursuant to
this Prospectus has been incorporated by reference into this Prospectus. See
"Documents Incorporated by Reference".

LEGAL MATTERS

The legality of the issuance of the shares of Common Stock of the Company
offered by this Prospectus will be passed upon for the Company by Schuler,
Messersmith & McNeill, Albuquerque, New Mexico.

EXPERTS

The financial statements of Service Systems International, Ltd. as of
August 31, 1996 and for UV Systems Technology, Inc. as of August 31, 1996
have been included as an exhibit and/or incorporated by reference herein in
reliance upon the report of Winter, Scheifley & Associates, P.C., independent
certified accountants, and Elliott Tulk Pryce Anderson, Chartered
Accountants, respectively, included as an exhibit and/or incorporated by
reference herein, upon the authority of those firms as experts in accounting
and auditing.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents, which are on file with the Securities and Exchange
Commission (File No. 0-21753), are incorporated in this Prospectus by reference
and made a part hereof:

25
<PAGE>

1. The Registrant's Form 10-SB effective on January 22, 1997 filed
pursuant to the Securities Exchange Act of 1934.

2. The Registrant's Quarterly Report on Form 10-QSB for the fiscal
quarter ended February 28, 1997.

3. The Registrant's Quarterly Report on Form 10-QSB for the fiscal
quarter ended May 31, 1997.

4. The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 10-SB effective January 22, 1997 under
Section 12 of the Exchange Act including any further amendment or report filed
for the purpose of updating that description.

All documents filed pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Exchange Act subsequent to the date of this Prospectus and before the
termination of the offering made hereby shall be deemed to be incorporated by
reference into this Prospectus and to be a part hereof from the respective dates
of filing of those documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for all purposes to the extent that a statement
contained in this Prospectus or any other subsequently filed document that is
also incorporated by reference herein modifies or supersedes that statement. Any
such statements so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.

The documents incorporated herein by reference (other than exhibits not
specifically incorporated by reference) are available without charge upon the
written or oral request of a person, including a beneficial owner, to whom a
Prospectus is delivered. The written or oral request should be directed to
Kenneth Fielding, President, 2800 Ingleton Ave., Burnaby, B.C. Canada V5E 3S5;
telephone (604)451-1069.

INDEMNIFICATION

26
<PAGE>

director, officer or employee of a corporation, provided that they acted in good
faith and in a manner they reasonably believed to be in or not opposed to the
best interests of the corporation. The Company must indemnify the person if the
person is successful on the merits or otherwise in defense of any action.
INSOFAR AS INDEMNIFICATION FOR LIABILITIES UNDER THE SECURITIES ACT OF 1933 MAY
BE PERMITTED TO DIRECTORS, OFFICERS OR CONTROLLING PERSONS OF THE COMPANY,
PURSUANT TO THE PROVISIONS DESCRIBED ABOVE, OR OTHERWISE, THE COMPANY HAS BEEN
ADVISED THAT IN THE OPINION OF THE SECURITIES AND EXCHANGE COMMISSION THAT
INDEMNIFICATION IS AGAINST PUBLIC POLICY AS EXPRESSED IN THE ACT, AND IS,
THEREFORE, UNENFORCEABLE.

PART II

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE

The following documents, which are on file with the Securities and Exchange
Commission (File No. 0-21753), are incorporated in this Prospectus by reference
and made a part hereof:

1. The Registrant's Form 10-SB effective on January 22, 1997 filed
pursuant to the Securities Exchange Act of 1934.

2. The Registrant's Quarterly Report on Form 10-Q for the fiscal
quarter ended February 28, 1997.

3. The Registrant's Quarterly Report on Form 10-QSB for the fiscal
quarter ended May 31, 1997.

4. The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 10-SB effective January 22, 1997
under Section 12 of the Exchange Act including any further amendment or report
filed for the purpose of updating that description.

27
<PAGE>

ITEM 4. DESCRIPTION OF SECURITIES

Not Applicable.

ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL

Not Applicable.

ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS

The Company is incorporated in Nevada. The Company's Bylaws provide that
the Company will indemnify its officers, directors and employees to the full
extent allowed by Nevada law. Nevada law provides that the Company may
indemnify its officers and directors for liabilities arising from actions
performed on behalf of the Company to the extent allowed by Section 78.751, as
amended, of the Nevada Revised Statutes. Section 78.751 contains provisions
permitting the Company to indemnify directors, officers and employees of the
Company for their expenses (including reasonable costs, disbursements and
counsel fees) and liabilities (including amounts paid or received in
satisfaction of settlements, judgments, fines and penalties), as the result of
an action or proceeding in which they may be involved by reason of being or
having been a director, officer or employee of a corporation, provided that they
acted in good faith and in a manner they reasonably believed to be in or not
opposed to the best interests of the corporation. The Company must indemnify
the person if the person is successful on the merits or otherwise in defense of
any action. INSOFAR AS INDEMNIFICATION FOR LIABILITIES UNDER THE SECURITIES ACT
OF 1933 MAY BE PERMITTED TO DIRECTORS, OFFICERS OR CONTROLLING PERSONS OF THE
COMPANY, PURSUANT TO THE PROVISIONS DESCRIBED ABOVE, OR OTHERWISE, THE COMPANY
HAS BEEN ADVISED THAT IN THE OPINION OF THE SECURITIES AND EXCHANGE COMMISSION
THAT INDEMNIFICATION IS AGAINST PUBLIC POLICY AS EXPRESSED IN THE ACT, AND IS,
THEREFORE, UNENFORCEABLE.

ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED

None
28
<PAGE>

ITEM 8. EXHIBITS

EXHIBIT DESCRIPTION OF EXHIBIT PAGE NO.
NO.
------- ---------------------- --------
<S> <C> <C>
4 Bylaws of the Registrant, as amended

5 Opinion of Schuler Messersmith & McNeill

23.1 Consents of Winter Scheifley & Associates,
P.C., independent certified accountants,
and Elliott Tulk Pryce Anderson, Chartered
Accountants

23.2 Consent of Schuler Messersmith & McNeill
(included in Exhibit 5)

24 Power of Attorney, included in signature
page forming a part hereof

99.1 Audited Financials of the Registrant for
the fiscal year ended August 31, 1996

99.2 Marketing Distribution Agreement between
UV Systems Technology, Inc. and Service
Systems International, Ltd.

99.3 Sales Representation Agreement between
UV Systems Technology, Inc. and "The
Representative."

99.4 Exclusive Distributorship Agreement between
UV Waterguard Systems, Inc. and Chiyoda
Kohan Co., Ltd. and NIMAC Corporation.
</TABLE>

ITEM 9. UNDERTAKINGS

(a) Rule 415 Offering.

The undersigned hereby undertakes:

(1) To file, during any period on which it offers or sells securities, a
post-effective amendment to this registration statement to:

(iii) Include any additional or changed material information on the
plan of distribution.

(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.

29
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Burnaby, B.C. Canada on October 2, 1997.

SERVICE SYSTEMS INTERNATIONAL, LTD.

By: /s/ KENNETH FIELDING
-------------------------------
Kenneth Fielding, President

KNOW ALL PEOPLE BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Kenneth Fielding and John R. Gaetz, and each of
them, with full power to act as his or her true and lawful attorney-in-fact,
with full power of substitution and resubstitution for him or her in his or her
name, place and stead, in any and all capacities to sign any and all amendments
(including post-effective amendments) to this registration statement, or a
related registration statement filed pursuant to Rule 462(b), and to file the
same, with all exhibits thereto, and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite or necessary to be done in
and about the premises, as fully to all intents and purposes as he or she might
or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or any of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this
registration statement or amendment thereto has been signed below by the
following persons in the capacities and on the dates indicated.

SIGNATURE CAPACITY DATE

/s/ KENNETH FIELDING President and Director October 2, 1997
- ---------------------
Kenneth Fielding

/s/ JOHN R. GAETZ Chief Financial Officer, October 2, 1997
- --------------------- Secretary, Treasurer,
John R. Gaetz Director

<PAGE>

INDEX TO THE BYLAWS OF

SERVICE SYSTEMS INTERNATIONAL LTD.

ARTICLE
1 - OFFICES

Section 1.1 Principal Office . . . . . . . . . . . . . . . . . . . . 4
Section 1.2 Registered Office. . . . . . . . . . . . . . . . . . . . 4

ARTICLE 2 - SHAREHOLDERS

Section 2.1 Annual Meeting . . . . . . . . . . . . . . . . . . . . . 4
Section 2.2 Special Meetings . . . . . . . . . . . . . . . . . . . . 5
Section 2.3 Place of Meetings. . . . . . . . . . . . . . . . . . . . 5
Section 2.4 Notice of Meeting. . . . . . . . . . . . . . . . . . . . 5
Section 2.5 Meeting of All Shareholders. . . . . . . . . . . . . . . 5
Section 2.6 Closing of Transfer Books or Fixing of Record Date . . . 5
Section 2.7 Voting Record. . . . . . . . . . . . . . . . . . . . . . 6
Section 2.8 Quorum . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.9 Manner of Acting . . . . . . . . . . . . . . . . . . . . 7
Section 2.10 Proxies. . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.11 Voting of Shares . . . . . . . . . . . . . . . . . . . . 7
Section 2.12 Voting of Shares by Certain Shareholders . . . . . . . . 8
Section 2.13 Informal Action by Shareholders. . . . . . . . . . . . . 9
Section 2.14 Voting by Ballot . . . . . . . . . . . . . . . . . . . . 9
Section 2.15 Cumulative Voting. . . . . . . . . . . . . . . . . . . . 9

ARTICLE 3 - BOARD OF DIRECTORS

Section 3.1 General Powers . . . . . . . . . . . . . . . . . . . . . 9
Section 3.2 Performance of Duties. . . . . . . . . . . . . . . . . . 9
Section 3.3 Number, Tenure and Qualifications. . . . . . . . . . . . 10
Section 3.4 Regular Meetings . . . . . . . . . . . . . . . . . . . . 10
Section 3.5 Special Meetings . . . . . . . . . . . . . . . . . . . . 11
Section 3.6 Notice . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.7 Quorum . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.8 Manner of Acting . . . . . . . . . . . . . . . . . . . . 11
Section 3.9 Informal Action by Directors . . . . . . . . . . . . . . 12
Section 3.10 Participation by Electronic Means. . . . . . . . . . . . 12
Section 3.11 Vacancies. . . . . . . . . . . . . . . . . . . . . . . . 12

<PAGE>

Section 3.12 Resignation. . . . . . . . . . . . . . . . . . . . . . . 12
Section 3.13 Removal. . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 3.14 Committees . . . . . . . . . . . . . . . . . . . . . . . 13
Section 3.15 Compensation . . . . . . . . . . . . . . . . . . . . . . 13
Section 3.16 Presumption of Assent. . . . . . . . . . . . . . . . . . 13

ARTICLE 4 - OFFICERS

Section 4.1 Number . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 4.2 Election and Term of Office. . . . . . . . . . . . . . . 14
Section 4.3 Removal. . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 4.4 Vacancies. . . . . . . . . . . . . . . . . . . . . . . . 14
Section 4.5 President. . . . . . . . . . . . . . . . . . . . . . . . 14
Section 4.6 Vice President . . . . . . . . . . . . . . . . . . . . . 15
Section 4.7 Secretary. . . . . . . . . . . . . . . . . . . . . . . . 15
Section 4.8 Treasurer. . . . . . . . . . . . . . . . . . . . . . . . 15
Section 4.9 Assistant Secretaries and Assistant Treasurers . . . . . 16
Section 4.10 Bonds. . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 4.11 Salaries . . . . . . . . . . . . . . . . . . . . . . . . 16

ARTICLE 5 - CONTRACTS, LOANS, CHECKS AND DEPOSITS

Section 5.1 Contracts. . . . . . . . . . . . . . . . . . . . . . . . 16
Section 5.2 Loans. . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 5.3 Checks, Drafts, Etc. . . . . . . . . . . . . . . . . . . 17
Section 5.4 Deposits . . . . . . . . . . . . . . . . . . . . . . . . 17

ARTICLE 6 - SHARES, CERTIFICATES FOR SHARES AND TRANSFER OF SHARES

Section 6.1 Regulation . . . . . . . . . . . . . . . . . . . . . . . 17
Section 6.2 Certificates for Shares. . . . . . . . . . . . . . . . . 17
Section 6.3 Cancellation of Certificates . . . . . . . . . . . . . . 18
Section 6.4 Lost, Stolen or Destroyed Certificates . . . . . . . . . 18
Section 6.5 Transfer of Shares . . . . . . . . . . . . . . . . . . . 18

ARTICLE 7 - FISCAL YEAR. . . . . . . . . . . . . . . . . . . . . . . . . 19

ARTICLE 8 - DIVIDENDS. . . . . . . . . . . . . . . . . . . . . . . . . . 19

<PAGE>

ARTICLE 9 - CORPORATE SEAL . . . . . . . . . . . . . . . . . . . . . . . 19

ARTICLE 10 - WAIVER OF NOTICE. . . . . . . . . . . . . . . . . . . . . . 19

ARTICLE 11 - AMENDMENTS. . . . . . . . . . . . . . . . . . . . . . . . . 19

ARTICLE 12 - EXECUTIVE COMMITTEE

Section 12.1 Appointment. . . . . . . . . . . . . . . . . . . . . . . 20
Section 12.2 Authority. . . . . . . . . . . . . . . . . . . . . . . . 20
Section 12.3 Tenure and Qualifications. . . . . . . . . . . . . . . . 20
Section 12.4 Meetings . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 12.5 Quorum . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 12.6 Informal Action by Executive Committee . . . . . . . . . 21
Section 12.7 Vacancies. . . . . . . . . . . . . . . . . . . . . . . . 21
Section 12.8 Resignations and Removal . . . . . . . . . . . . . . . . 21
Section 12.9 Procedure. . . . . . . . . . . . . . . . . . . . . . . . 21

ARTICLE 13 - EMERGENCY BYLAWS. . . . . . . . . . . . . . . . . . . . . . 21

<PAGE>

BYLAWS
OF
SERVICE SYSTEMS INTERNATIONAL LTD.

ARTICLE 1
OFFICES
SECTION 1.1 PRINCIPAL OFFICE.

The principal office of the corporation in the state of Nevada shall
be located in the City of Las Vegas. The corporation may have such other
offices, either within or outside of the state of Nevada as the board of
directors may designate, or as the business of the corporation may require from
time to time.

SECTION 1.2 REGISTERED OFFICE.

The registered office of the corporation, required by the Nevada
Corporation Code to be maintained in the state of Nevada, may be, but need not
be, identical with the principal office in the state of Nevada, and the address
of the registered office may be changed from time to time by the board of
directors.

ARTICLE 2

SHAREHOLDERS

SECTION 2.1 ANNUAL MEETING.

The annual meeting of the shareholders shall be held on the first
Tuesday in September of each year, commencing with the year 1991, at the hour of
10:00 a.m., or at such other time on such other day as shall be fixed by the
board of directors for the purpose of electing directors and for the transaction
of such other business as may come before the meeting. If the day fixed for the
annual meeting shall be a legal holiday in the state of Nevada, such meeting
shall be held on the next succeeding business day. If the election of directors
shall not be held on the day designated herein for any annual meeting of the
shareholders, or at any adjournment thereof, the board of directors shall cause
the election to be held at a special meeting of the shareholders as soon
thereafter as may be

<PAGE>

convenient.

SECTION 2.2 SPECIAL MEETINGS.

Special meetings of the shareholders, for any purpose or purposes,
unless otherwise prescribed by statute, may be called by the president or by the
board of directors, and shall be called by the president at the request of the
holders of not less than one-tenth of all outstanding shares of the corporation
entitled to vote at the meeting.

SECTION 2.3 PLACE OF MEETINGS.

The board of directors may designate any place, either within or
outside of the state of Nevada, as the place of meeting for any annual meeting
or for any special meeting called by the board of directors. If no designation
is made, or if a special meeting be otherwise called, the place of meeting shall
be the principal office of the corporation in the state of Nevada.

SECTION 2.4 NOTICE OF MEETING.

Written notice stating the place, day and hour of the meeting of
shareholders and, in case of a special meeting, the purpose or purposes for
which the meeting is called, shall, unless otherwise prescribed by statute, be
delivered not less than ten nor more than fifty days before the date of the
meeting, either personally or by mail, by or at the direction of the president,
or the secretary, or the officer or other persons calling the meeting, to each
shareholder of record entitled to vote at such meeting; provided, however, that
if the authorized shares of the corporation are to be increased, at least thirty
days' notice shall be given, and if sale of all or substantially all assets are
to be voted upon, at least twenty days' notice shall be given. If mailed, such
notice shall be deemed to be delivered when deposited in the United States mail,
addressed to the shareholder at his or her address as it appears on the stock
transfer books of the corporation, with postage thereon prepaid.

SECTION 2.5 MEETING OF ALL SHAREHOLDERS.

Except as provided by law, if a majority of the shareholders meet at
any time and place, either within or outside of the state of Nevada, and consent
to the holding of a meeting at such time and place, such meeting shall be valid

<PAGE>

without call or notice, and at such meeting any corporate action may be taken.

SECTION 2.6 CLOSING OF TRANSFER BOOKS OR
FIXING OF RECORD DATE

For the purpose of determining shareholders entitled to notice of or
to vote at any meeting of shareholders or any adjournment thereof, or
shareholders entitled to receive payment of any dividend, or in order to make a
determination of shareholders for any other purpose, the board of directors of
the corporation may provide that the share transfer books shall be closed for a
stated period but not to exceed, in any case, fifty days. If the share transfer
books shall be closed for the purpose of determining shareholders entitled to
notice of or to vote at a meeting of shareholders, such books shall be closed
for at least ten days immediately preceding such meeting. In lieu of closing
the share transfer books, the board of directors may fix in advance a date as
the record date for any such determination of shareholders, such date in any
case to be not more than fifty days and, in case of a meeting of shareholders,
not less than ten days prior to the date on which the particular action,
requiring such determination of shareholders, is to be taken. If the share
transfer books are not closed and no record date is fixed for the determination
of shareholders entitled to notice of or to vote at a meeting of shareholders,
or shareholders entitled to receive payment of a dividend, the date on which
notice of the meeting is mailed or the date on which the resolution of the board
of directors declaring such dividend is adopted, as the case may be, shall be
the record date for such determination of shareholders. When a determination of
shareholders entitled to vote at any meeting of shareholders has been made as
provided in this Section, such determination shall apply to any adjournment
thereof.

SECTION 2.7 VOTING RECORD.

The officer or agent having charge of the stock transfer books for
shares of the corporation shall make, at least ten days before such meeting of
shareholders, a complete record of the shareholders entitled to vote at each
meeting of shareholders or any adjournment thereof, arranged in alphabetical
order, with the address of and the number of shares held by each. The record,
for a period of ten days prior to such meeting, shall be kept on file at the
principal office of the corporation, whether within or outside of the state of

<PAGE>

Nevada, and shall be subject to inspection by any shareholder for any purpose
germane to the meeting at any time during usual business hours. Such record
shall be produced and kept open at the time and place of the meeting and shall
be subject to the inspection of any shareholder during the whole time of the
meeting for the purposes thereof.

The original stock transfer books shall be the prima facie evidence
as to who are the shareholders entitled to examine the record or transfer books
or to vote at any meeting of shareholders.

SECTION 2.8 QUORUM.

A majority of the outstanding shares of the corporation entitled to
vote, represented in person or by proxy, shall constitute a quorum at any
meeting of shareholders, except as otherwise provided by the Nevada Corporation
Code and the Articles of Incorporation. In the absence of a quorum at any such
meeting, a majority of the shares so represented may adjourn the meeting from
time to time for a period not to exceed sixty days without further notice. At
such adjourned meeting at which a quorum shall be present or represented, any
business may be transacted which might have been transacted at the meeting as
originally noticed. The shareholders present at a duly organized meeting may
continue to transact business until adjournment, notwithstanding the withdrawal
during such meeting of that number of shareholders whose absence would cause
there to be less than a quorum.

SECTION 2.9 MANNER OF ACTING.

If a quorum is present, the affirmative vote of the majority of the
shares represented at the meeting and entitled to vote on the subject matter
shall be the act of the shareholders, unless the vote of a greater proportion or
number or voting by classes is otherwise required by statute or by the Articles
of incorporation or these bylaws.

SECTION 2.10 PROXIES.

At all meetings of shareholders a shareholder may vote in person or by
proxy executed in writing by the shareholder or by a duly authorized attorney-
in-fact. Such proxy shall be filed with the secretary of the corporation before
or at the time of the meeting. No proxy shall be valid after eleven months from
the date of its execution, unless

<PAGE>

otherwise provided in the proxy.

SECTION 2.11 VOTING OF SHARES.

Unless otherwise provided by these bylaws or the Articles of
Incorporation, each outstanding share entitled to vote shall be entitled to one
vote upon each matter submitted to vote at a meeting of shareholders, and each
fractional share shall be entitled to a corresponding fractional vote on each
such matter.

SECTION 2.12 VOTING OF SHARES BY CERTAIN SHAREHOLDERS

Shares standing in the name of another corporation may be voted by
such officer, agent or proxy as the bylaws of such corporation may prescribe,
or, in the absence of such provision, as the board of directors of such other
corporation may determine.

Shares standing in the name of a deceased person, a minor ward or an
incompetent person, may be voted by an administrator, executor, court appointed
guardian or conservator, either in person or by proxy without a transfer of such
shares into the name of such administrator, executor, court appointed guardian
or conservator. Shares standing in the name of a trustee may be voted by him,
either in person or by proxy, but no trustee shall be entitled to vote shares
held by him or her without a transfer of such shares into his or her name.

Shares standing in the name of a receiver may be voted by such
receiver and shares held by or under the control of a receiver may be voted by
such receiver without the transfer thereof into the trustee name if authority so
to do be contained in an appropriate order of the court by which such receiver
was appointed.

A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.

Neither shares of its own stock belonging to this corporation, nor
shares of its own stock held by it in a fiduciary capacity, nor shares of its
own stock held by another corporation if the majority of shares entitled to vote
for the election of directors of such corporation is held by this

<PAGE>

corporation may be voted, directly or indirectly, at any meeting and shall not
be counted in determining the total number of outstanding shares at any given
time.

Redeemable shares which have been called for redemption shall not be
entitled to vote on any matter and shall not be deemed outstanding shares on and
after the date on which written notice of redemption has been mailed to
shareholders and a sum sufficient to redeem such shares has been deposited with
a bank or trust company with irrevocable instruction and authority to pay the
redemption price to the holders of the shares upon surrender of certificates
therefor.

SECTION 2.13 INFORMAL ACTION BY SHAREHOLDERS.

Except as provided by law, any action required or permitted to be
taken at a meeting of the shareholders may be taken without a meeting if a
consent in writing, setting forth the action so taken, shall be signed by a
majority of the shareholders entitled to vote with respect to the subject matter
thereof.

SECTION 2.14 VOTING BY BALLOT.

Voting on any question or in any election may be by voice vote unless
the presiding officer shall order or any shareholder shall demand that voting be
by ballot.

SECTION 2.15 CUMULATIVE VOTING.

Cumulative voting shall not be permitted in the election of officers
or directors, or in any other matter.

ARTICLE 3

BOARD OF DIRECTORS

SECTION 3.1 GENERAL POWERS.

The business and affairs of the corporation shall be managed by its
board of directors.

SECTION 3.2 PERFORMANCE OF DUTIES.

A director of the corporation shall perform his or her duties as a
director, including his or her duties as a member of any committee of the board
upon which he or she may

9
<PAGE>

serve, in good faith, in a manner he or she reasonably believes to be in the
best interests of the corporation, and with such care as an ordinarily prudent
person in a like position would use under similar circumstances. In performing
his or her duties, a director shall be entitled to rely on information,
opinions, reports, or statements, including financial statements and other
financial data, in each case prepared or presented by persons and groups listed
in paragraphs (a), (b), and (c) of this Section 3.2; but he or she shall not be
considered to be acting in good faith if he or she has knowledge concerning the
matter in question that would cause such reliance to be unwarranted. A person
who so performs his or her duties shall not have any liability by reason of
being or having been a director of the corporation. Those persons and groups on
whose information, opinions, reports, and statements a director is entitled to
rely upon are:

A. One or more officers or employees of the corporation whom the
director reasonably believes to be reliable and competent in the matter
presented;

B. Counsel, public accountants, or other persons as to matters which
the director reasonably believes to be within such persons' professional or
expert competence; or

C. A committee of the board upon which he or she does not serve,
duly designated in accordance with the provision of the Articles of
Incorporation or the bylaws, as to matters within its designated authority,
which committee the director reasonably believes to merit confidence.

SECTION 3.3 NUMBER, TENURE AND QUALIFICATIONS.

The number of directors of the corporation shall be three. The
number of directors of the corporation shall be fixed from time to time by
resolution of the board of directors, but in no instance shall there be less
than one director or that number otherwise required by law. Each director shall
hold office until the next annual meeting of shareholders or until his or her
successor shall have been elected and qualified. Directors need not be
residents of the state of Nevada nor shareholders of the corporation.

When shares of the corporation shall become owned beneficially or of
record by one shareholder, the corporation shall elect at least one director.
When the shares of the corporation shall become owned beneficially or of record
by two

10
<PAGE>

shareholders, the corporation shall elect at least two directors. When the
shares of the corporation shall become owned beneficially or of record by three
or more shareholders, the corporation shall elect at least three directors.

There shall be a chairman of the board, who has been elected from
among the directors. He or she shall preside at all meetings of the
stockholders and of the board of directors. He or she shall have such other
powers and duties as may be prescribed by the board of directors.

SECTION 3.4 REGULAR MEETINGS.

A regular meeting of the board of directors shall be held without
other notice than this bylaw immediately after, and at the same place as, the
annual meeting of shareholders. The board of directors may provide, by
resolution, the time and place, either within or without the state of Nevada,
for the holding of additional regular meetings without other notice than such
resolution.

SECTION 3.5 SPECIAL MEETINGS.

Special meetings of the board of directors may be called by or at the
request of the president or any two directors. The person or persons authorized
to call special meetings of the board of directors may fix any place, either
within or without the state of Nevada, as the place for holding any special
meeting of the board of directors called by them.

SECTION 3.6 NOTICE.

Written notice of any special meeting of directors shall be given as
follows:

By mail to each director at his or her business address at least
three days prior to the meeting; or

By personal delivery or telegram at least twenty-four hours prior to
the meeting to the business address of each director, or in the event such
notice is given on a Saturday, Sunday or holiday, to the residence address of
each director. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail, so addressed, with postage thereon prepaid.
If notice be given by telegram, such notice shall be deemed to be delivered when
the telegram is delivered to the telegraph company. Any director may waive
notice of any

<PAGE>

meeting. The attendance of a director at any meeting shall constitute a waiver
of notice of such meeting, except where a director attends a meeting for the
express purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the board
of directors need be specified in the notice or waiver of notice of such
meeting.

SECTION 3.7 QUORUM.

A majority of the number of directors fixed by or pursuant to Section
3.2 of this Article 3 shall constitute a quorum for the transaction of business
at any meeting of the board of directors, but if less than such majority is
present at a meeting, a majority of the directors present may adjourn the
meeting from time to time without further notice.

SECTION 3.8 MANNER OF ACTING.

Except as otherwise required by law or by the Articles of
Incorporation, the act of the majority of the directors present at a meeting at
which a quorum is present shall be the act of the board of directors.

SECTION 3.9 INFORMAL ACTION BY DIRECTORS.

Any action required or permitted to be taken by the board of directors
or by a committee thereof at a meeting may be taken without a meeting if a
consent in writing, setting forth the action so taken, shall be signed by all of
the directors or all of the committee members entitled to vote with respect to
the subject matter thereof.

SECTION 3.10 PARTICIPATION BY ELECTRONIC MEANS.

Any members of the board of directors or any committee designated by
such board may participate in a meeting of the board of directors or committee
by means of telephone conference or similar communications equipment by which
all persons participating in the meeting can hear each other at the same time.
Such participation shall constitute presence in person at the meeting.

SECTION 3.11 VACANCIES.

<PAGE>

Any vacancy occurring in the board of directors may be filled by the
affirmative vote of a majority of the remaining directors though less than a
quorum of the board of directors. A director elected to fill a vacancy shall be
elected for the unexpired term of his or her predecessor in office. Any
directorship to be filled by reason of an increase in the number of directors
may be filled by election by the board of directors for a term of office
continuing only until the next election of directors by the shareholders.

SECTION 3.12 RESIGNATION.

Any director of the corporation may resign at any time by giving
written notice to the president or the secretary of the corporation. The
resignation of any director shall take effect upon receipt of notice thereof or
at such later time as shall be specified in such notice; and, unless otherwise
specified therein, the acceptance of such resignation shall not be necessary to
make it effective. When one or more directors shall resign from the board,
effective at a future date, a majority of the directors then in office,
including those who have so resigned, shall have power to fill such vacancy or
vacancies, the vote thereon to take effect when such resignation or resignations
shall become effective.

SECTION 3.13 REMOVAL.

Any director or directors of the corporation may be removed at any
time, with or without cause, in the manner provided in the Nevada Corporation
Code.

SECTION 3.14 COMMITTEES.

By resolution adopted by a majority of the board of directors, the
directors may designate two or more directors to constitute a committee, any of
which shall have such authority in the management of the corporation as the
board of directors shall designate and as shall be prescribed by the Nevada
Corporation Code.

SECTION 3.15 COMPENSATION.

By resolution of the board of directors and irrespective of any
personal interest of any of the members, each director may be paid his or her
expenses, if any, of attendance at each meeting of the board of directors, and
may be paid a stated salary as director or a fixed sum for

<PAGE>

attendance at each meeting of the board of directors or both. No such payment
shall preclude any director from serving the corporation in any other capacity
and receiving compensation therefor.

SECTION 3.16 PRESUMPTION OF ASSENT.

A director of the corporation who is present at a meeting of the board
of directors at which action on any corporate matter is taken shall be presumed
to have assented to the action taken unless his or her dissent shall be entered
in the minutes of the meeting or unless he or she shall file his or her written
dissent to such action with the person acting as the secretary of the meeting
before the adjournment thereof or shall forward such dissent by registered mail
to the secretary of the corporation immediately after the adjournment of the
meeting. Such right to dissent shall not apply to a director who voted in favor
of such action.

ARTICLE 4

OFFICERS

SECTION 4.1 NUMBER.

The officers of the corporation shall be a president and secretary,
each of whom shall be elected by the board of directors. Such other officers
and assistant officers as may be deemed necessary may be elected or appointed by
the board of directors. Any two or more offices may be held by the same person,
except the offices of president and secretary.

SECTION 4.2 ELECTION AND TERM OF OFFICE.

The officers of the corporation to be elected by the board of
directors shall be elected annually by the board of directors at the first
meeting of the board of directors held after the annual meeting of the
shareholders. If the election of officers shall not be held at such meeting,
such election shall be held as soon thereafter as practicable. Each officer
shall hold office until his or her successor shall have been duly elected and
shall have qualified or until his or her death or until he or she shall resign
or shall have been removed in the manner hereinafter provided.

SECTION 4.3 REMOVAL.

14
<PAGE>

Any officer or agent may be removed by the board of directors whenever
in its judgment the best interests of the corporation will be served thereby,
but such removal shall be without prejudice to the contract rights, if any, of
the person so removed. Election or appointment of an officer or agent shall not
of itself create contract rights.

SECTION 4.4 VACANCIES.

A vacancy in any office because of death, resignation, removal,
disqualification or otherwise, may be filled by the board of directors for the
unexpired portion of the term.

SECTION 4.5 PRESIDENT.

The president shall be the chief executive officer of the
corporation and, subject to the control of the board of directors, shall in
general supervise and control all of the business and affairs of the
corporation. He or she shall, when present, and in the absence of a chairman
of the board, preside at all meetings of the shareholders and of the board of
directors. He or she may sign, with the secretary or any other proper
officer of the corporation thereunto authorized by the board of directors,
certificates for shares of the corporation and deeds, mortgages, bonds,
contracts, or other instruments which the board of directors has authorized
to be executed, excepted in cases where the signing and execution thereof
shall be expressly delegated by the board of directors or by these bylaws to
some other officer or agent of the corporation, or shall be required by law
to be otherwise signed or executed; and in general shall perform all duties
incident to the office of president and such other duties as may be
prescribed by the board of directors from time to time.

SECTION 4.6 VICE PRESIDENT.

If elected or appointed by the board of directors, the vice president
(or in the event there be more than one vice president, the vice presidents in
the order designated at the time of their election, or in the absence of any
designation, then in the order of their election) shall, in the absence of the
president or in the event of his or her death, inability or refusal to act,
perform all duties of the president, and when so acting, shall have all the
powers of and be subject to all the restrictions upon the president. Any vice
president may sign, with the treasurer or an assistant treasurer or the

<PAGE>

secretary or an assistant secretary, certificates for shares of the corporation;
and shall perform such other duties as from time to time may be assigned to him
or her by the president or by the board of directors.

SECTION 4.7 SECRETARY.

The secretary shall: (a) keep the minutes of the proceedings of the
shareholders and of the board of directors in one or more books provided for
that purpose; (b) see that all notices are duly given in accordance with the
provisions of these bylaws or as required by law; (c) be custodian of the
corporate records and of the seal of the corporation and see that the seal of
the corporation is affixed to all documents the execution of which on behalf of
the corporation under its seal is duly authorized; (d) keep a register of the
post office address of each shareholder which shall be furnished to the
secretary by such shareholder; (e) sign with the chairman or vice chairman of
the board of directors, or the president, or a vice president, certificates for
shares of the corporation, the issuance of which shall have been authorized by
resolution of the board of directors; (f) have general charge of the stock
transfer books of the corporation; and (g) in general perform all duties
incident to the office of secretary and such other duties as from time to time
may be assigned to him or her by the president or by the board of directors.

SECTION 4.8 TREASURER.

The treasurer shall: (a) have charge and custody of and be responsible
for all funds and securities of the corporation; (b) receive and give receipts
for moneys due and payable to the corporation from any source whatsoever, and
deposit all such moneys in the name of the corporation in such banks, trust
companies or other depositories as shall be selected in accordance with the
provisions of Article 5 of these bylaws; and (c) in general perform all of the
duties incident to the office of treasurer and such other duties as from time to
time may be assigned to him or her by the president or by the board of
directors.

SECTION 4.9 ASSISTANT SECRETARIES AND ASSISTANT TREASURERS.

The assistant secretaries, when authorized by the board of directors,
may sign with the chairman or vice chairman of the board of directors or the
president or a vice president certificates for shares of the corporation the
issuance of

<PAGE>

which shall have been authorized by a resolution of the board of directors. The
assistant secretaries and assistant treasurers, in general, shall perform such
duties as shall be assigned to them by the secretary or the treasurer,
respectively, or by the president or the board of directors.

SECTION 4.10 BONDS.

If the board of directors by resolution shall so require, any officer
or agent of the corporation shall give bond to the corporation in such amount
and with such surety as the board of directors may deem sufficient, conditioned
upon the faithful performance of their respective duties and offices.

SECTION 4.11 SALARIES.

The salaries of the officers shall be fixed from time to time by the
board of directors and no officer shall be prevented from receiving such salary
by reason of the fact that he or she is also a director of the corporation.

ARTICLE 5

CONTRACTS, LOANS, CHECKS AND DEPOSITS

SECTION 5.1 CONTRACTS.

The board of directors may authorize any officer or officers, agent or
agents, to enter into any contract or execute and deliver any instrument in the
name of and on behalf of the corporation, and such authority may be general or
confined to specific instances.

SECTION 5.2 LOANS.

No loans shall be contracted on behalf of the corporation and no
evidences of indebtedness shall be issued in its name unless authorized by a
resolution of the board of directors. Such authority may be general or confined
to specific instances.

SECTION 5.3 CHECKS, DRAFTS, ETC.

All checks, drafts or other orders for the payment of money, notes or
other evidences of indebtedness issued in the name of the corporation shall be
signed by such officer or

<PAGE>

officers, agent or agents of the corporation and in such manner as shall from
time to time be determined by resolution of the board of directors.

SECTION 5.4 DEPOSITS.

All funds of the corporation not otherwise employed shall be deposited
from time to time to the credit of the corporation in such banks, trust
companies or other depositories as the board of directors may select.

ARTICLE 6

SHARES, CERTIFICATES FOR SHARES AND TRANSFER OF SHARES

SECTION 6.1 REGULATION.

The board of directors may make such rules and regulations as it may
deem appropriate concerning the issuance, transfer and registration of
certificates for shares of the corporation, including the appointment of
transfer agents and registrars.

SECTION 6.2 CERTIFICATES FOR SHARES.

Certificates representing shares of the corporation shall be
respectively numbered serially for each class of shares, or series thereof, as
they are issued, shall be impressed with the corporate seal or a facsimile
thereof, and shall be signed by the chairman or vice-chairman of the board of
directors or by the president or a vice president and by the treasurer or an
assistant treasurer or by the secretary or an assistant secretary; provided that
such signatures may be facsimile if the certificate is counter-signed by a
transfer agent, or registered by a registrar other than the corporation itself
or its employee. Each certificate shall state the name of the corporation, the
fact that the corporation is organized or incorporated under the laws of the
state of Nevada, the name of the person to whom issued, the date of issue, the
class (or series of any class), the number of shares represented thereby and the
par value of the shares represented thereby or a statement that such shares are
without par value. A statement of the designations, preferences,
qualifications, limitations, restrictions and special or relative rights of the
shares of each class shall be set forth in full or summarized on the face or
back of the certificates which the corporation shall issue, or in lieu thereof,
the certificate may set forth that such a

18
<PAGE>

statement or summary will be furnished to any shareholder upon request without
charge. Each certificate shall be otherwise in such form as may be prescribed
by the board of directors and as shall conform to the rules of any stock
exchange on which the shares may be listed.

The corporation shall not issue certificates representing fractional
shares and shall not be obligated to make any transfers creating a fractional
interest in a share of stock. The corporation may, but shall not be obligated
to, issue scrip in lieu of any fractional shares, such scrip to have terms and
conditions specified by the board of directors.

SECTION 6.3 CANCELLATION OF CERTIFICATES.

All certificates surrendered to the corporation for transfer shall be
cancelled and no new certificates shall be issued in lieu thereof until the
former certificate for a like number of shares shall have been surrendered and
cancelled, except as herein provided with respect to lost, stolen or destroyed
certificates.

SECTION 6.4 LOST, STOLEN OR DESTROYED CERTIFICATES.

Any shareholder claiming that his or her certificate for shares is
lost, stolen or destroyed may make an affidavit or affirmation of that fact and
lodge the same with the secretary of the corporation, accompanied by a signed
application for a new certificate. Thereupon, and upon the giving of a
satisfactory bond of indemnity to the corporation not exceeding an amount double
the value of the shares as represented by such certificate (the necessity for
such bond and the amount required to be determined by the president and
treasurer of the corporation), a new certificate may be issued-of the same tenor
and representing the same number, class and series of shares as were represented
by the certificate alleged to be lost, stolen or destroyed.

SECTION 6.5 TRANSFER OF SHARES.

Subject to the terms of any shareholder agreement relating to the
transfer of shares or other transfer restrictions contained in the Articles of
Incorporation or authorized therein, shares of the corporation shall be
transferable on the books of the corporation by the holder thereof in person or
by his or her duly authorized attorney, upon the surrender and cancellation of a
certificate or

<PAGE>

certificates for a like number of shares. Upon presentation and surrender of a
certificate for shares properly endorsed and payment of all taxes therefor, the
transferee shall be entitled to a new certificate or certificates in lieu
thereof. As against the corporation, a transfer of shares can be made only on
the books of the corporation and in the manner hereinabove provided, and the
corporation shall be entitled to treat the holder of record of any share as the
owner thereof and shall not be bound to recognize any equitable or other claim
to or interest in such share on the part of any other person, whether or not it
shall have express or other notice thereof, save as expressly provided by the
statutes of the state of Nevada.

ARTICLE 7

FISCAL YEAR

The fiscal year of the corporation shall end on the last day of
December in each calendar year.

ARTICLE 8

DIVIDENDS

The board of directors may from time to time declare, and the
corporation may pay, dividends on its outstanding shares in the manner and upon
the terms and conditions provided by law and its Articles of Incorporation.

ARTICLE 9

CORPORATE SEAL

The board of directors shall provide a corporate seal. which shall be
circular in form and shall have inscribed thereon the name of the corporation
and the state of incorporation and the words "CORPORATE SEAL."

ARTICLE 10

WAIVER OF NOTICE

Whenever any notice is required to be given under the provisions of
these bylaws or under the provisions of the Articles of Incorporation or under
the provisions of the Nevada Corporation Code, or otherwise, a waiver thereof in
writing, signed by the person or persons entitled to such notice,

<PAGE>

whether before or after the event or other circumstance requiring such notice,
shall be deemed equivalent to the giving of such notice.

ARTICLE 11

AMENDMENTS

These bylaws may be altered, amended or repealed and new bylaws may be
adopted by a majority of the directors present at any meeting of the board of
directors of the corporation at which a quorum is present.

ARTICLE 12

EXECUTIVE COMMITTEE

SECTION 12.1 APPOINTMENT.

The board of directors by resolution adopted by a majority of the full
board, may designate two or more of its members to constitute an executive
committee. The designation of such committee and the delegation thereto of
authority shall not operate to relieve the board of directors, or any member
thereof, of any responsibility imposed by law.

SECTION 12.2 AUTHORITY.

The executive committee, when the board of directors is not in
session, shall have and may exercise all of the authority of the board of
directors except to the extent, if any, that such authority shall be limited by
the resolution appointing the executive committee and except also that the
executive committee shall not have the authority of the board of directors in
reference to amending the Articles of Incorporation, adopting a plan of merger
or consolidation, recommending to the shareholders the sale, lease or other
disposition of all or substantially all of the property and assets of the
corporation otherwise than in the usual and regular course of its business,
recommending to the shareholders a voluntary dissolution of the corporation or
a revocation thereof, or amending the bylaws of the corporation.

SECTION 12.3 TENURE AND QUALIFICATIONS.

Each member of the executive committee shall hold office until the
next regular annual meeting of the board of

<PAGE>

directors following his or her designation and until his or her successor is
designated as a member of the executive committee and is elected and qualified

SECTION 12.4 MEETINGS.

Regular meetings of the executive committee may be held without notice
at such time and places as the executive committee may fix from time to time by
resolution. Special meetings of the executive committee may be called by any
member thereof upon not less than one day's notice stating the place, date and
hour of the meeting, which notice may be written or oral, and if mailed, shall
be deemed to be delivered when deposited in the United States mail addressed to
the member of the executive committee at his or her business address. Any
member of the executive committee may waive notice of any meeting and no notice
of any meeting need be given to any member thereof who attends in person. The
notice of a meeting of the executive committee need not state the business
proposed to be transacted at the meeting.

SECTION 12.5 QUORUM.

A majority of the members of the executive committee shall constitute
a quorum for the transaction of business at any meeting thereof, and action of
the executive committee must be authorized by the affirmative vote of a majority
of the members present at a meeting at which a quorum is present.

SECTION 12.6 INFORMAL ACTION BY EXECUTIVE COMMITTEE.

Any action required or permitted to be taken by the executive
committee at a meeting may be taken without a meeting if a consent in writing,
setting forth the action so taken shall be signed by all of the directors
entitled to vote with respect to the subject matter thereof.

SECTION 12.7 VACANCIES.

Any vacancy in the executive committee may be filled by a resolution
adopted by a majority of the full board of directors.

SECTION 12.8 RESIGNATIONS AND REMOVAL.

Any member of the executive committee may be removed at any time with
or without cause by resolution adopted by a

<PAGE>

majority of the full board of directors. Any member of the executive committee
may resign from the executive committee at any time by giving written notice to
the president or secretary of the corporation, and unless otherwise specified
therein, the acceptance of such resignation shall not be necessary to make it
effective.

SECTION 12.9 PROCEDURE.

The executive committee shall elect a presiding officer from its
members and may fix its own rules of procedure which shall not be inconsistent
with these bylaws. It shall keep regular minutes of its proceedings and report
the same to the board of directors for its information at the meeting thereof
held next after the proceedings shall have been taken.

ARTICLE 13

EMERGENCY BYLAWS

The emergency bylaws provided in this Article 13 shall be operative
during any emergency in the conduct of the business of the corporation resulting
from an attack on the United States or any nuclear or atomic disaster,
notwithstanding any different provision in the preceding articles of the bylaws
or in the Articles of Incorporation of the corporation or in the Nevada
Corporation Code. To the extent not inconsistent with the provisions of this
Article, the bylaws provided in the preceding articles shall remain in effect
during such emergency and upon its termination the emergency bylaws shall cease
to be operative. During any such emergency:

A. A meeting of the board of directors may be called by any officer
or director of the corporation. Notice of the time and place of the meeting
shall be given by the person calling the meeting to such of the directors as it
may be feasible to reach by any available means of communication. Such notice
shall be given at such time in advance of the meeting as circumstances permit in
the judgment of the person calling the meeting.

B. At any such meeting of the board of directors, a quorum shall
consist of the number of directors in attendance at such meeting.

C. The board of directors, either before or during

<PAGE>

any such emergency, may, effective in the emergency, change the principal office
or designate several alternative principal offices or regional offices, or
authorize the officers so to do.

D. The board of directors, either before or during any such
emergency, may provide, and from time to time modify, lines of succession in the
event that during such an emergency any or all officers or agents of the
corporation shall for any reason be rendered incapable of discharging their
duties.

E. No officer, director or employee acting in accordance with these
emergency bylaws shall be liable except for willful misconduct.

F. These emergency bylaws shall be subject to repeal or change by
further action of the board of directors or by action of the shareholders, but
no such repeal or change shall modify the provisions of the next preceding
paragraph with regard to action taken prior to the time of such repeal or
change. Any amendment of these emergency bylaws may make any further or
different provision that may be practical and necessary for the circumstances of
the emergency.

CERTIFICATE

I hereby certify that the foregoing bylaws, consisting of 24 pages,
including this page, constitute the bylaws of SERVICE SYSTEMS INTERNATIONAL
LTD., adopted by the board of directors of the corporation as of August 28,
1990.

/s/ Suzy Frost
----------------------------------
Suzy Frost

<PAGE>

FIRST AMENDMENT TO

BYLAWS OF

SERVICE SYSTEMS INTERNATIONAL, LTD.

1. The first sentence of Article 2, Section 2.1 is amended by deleting it
in its entirety and substituting the following therefor:

"The annual meeting of the shareholders shall be held in the month of
January of each year, at a time and place fixed by the board of Directors for
the purpose of the electing directors and the transaction of any other business
as may come before the meeting."

2. The first sentence of Article 3, Section 3.3 is amended to delete it
in its entirety and substitute the following therefor:

"The number of directors of the Corporation shall be no fewer than one
nor more than nine."

3. Article 7 is amended by deleting the sentence in its entirety and
substituting the following therefor:

"The fiscal year of the Corporation shall be determined by resolution
of the board of directors."

4. Article 13 of the Corporation's Bylaws is amended by deleting it in
its entirety and substituting the following therefor:

INDEMNIFICATION

The Corporation shall indemnify persons to the fullest extent provided
in the Nevada Revised Statutes.

<PAGE>

SCHULER, MESSERSMITH & MCNEILL
ATTORNEYS AND COUNSELORS AT LAW
NORTH POINTE PLAZA
5700 HARPER DRIVE NE, SUITE 430
ALBUQUERQUE, NEW MEXICO 87109

September 25, 1997

Service Systems International, Ltd.
2800 Ingleton Avenue
Burnaby B.C. Canada V5C 6G7

Ladies and Gentlemen:

We have participated in the preparation of the Registration Statement on
Form S-8 (the "Registration Statement") to be filed with the Securities and
Exchange Commission by Service Systems International, Ltd. ("Company") for
the purpose of registering under the Securities Act of 1933, 1,588,000 shares
("Shares") of the $.001 par value common stock of the Company proposed to be
issued under the Company's 1997 Stock Option Plan ("Plan").

For purposes of this opinion, we have examined such records, certificates
and documents, and such questions of law, as we have deemed necessary as a
basis for the opinions hereafter expressed. In all such examinations, we have
assumed the genuineness of all signatures on original or certified copies and
the conformity to original or certified copies of all copies submitted to us
as conformed or reproduction copies. As to various questions of fact relevant
to those opinions, we have relied upon statements and written information of
representatives of the Company and of others.

Based upon the foregoing and subject to the limitations set forth herein,
it is our opinion that the Shares under the Plan have been duly authorized
and, when issued, delivered and paid for in accordance with the terms of the
Plan, assuming that the applicable option offering price, (as that term is
defined in the Plan) is paid with respect to each Share before issuance, and
full compliance with the Plan is otherwise made.

We consent to the filing of this opinion as an exhibit to the Registration
Statement and to the reference to this firm under the caption "Legal Matters"
in the Reoffer Prospectus forming part of the Registration Statement. In
giving that consent, we do not thereby admit that we are in the category of
those persons whose consent is required under Section 7 of the Securities Act
of 1933.

<PAGE>

The opinions expressed in this letter are solely for your benefit and may
not be relied upon by any other person or used in any manner or for any
purpose except as specifically provided for in this letter.

Very truly yours,

Schuler, Messersmith & McNeill

<PAGE>

CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 of Service Systems International, Ltd. of our report
dated March 11, 1997, relating to the financial statements of Service Systems
International Ltd. as of August 31, 1996.

/s/ Winter, Scheifley & Associates, P.C.

Winter, Scheifley & Associates, P.C.
Certified Public Accountants

September 26, 1997
Englewood, Colorado

<PAGE>

Consent of Independent Auditors

We consent to the incorporation by reference in the Registration Statement on
Form S-8 pertaining to an aggregate of 1,588,000 shares of Common Stock of
Service Systems International Ltd. issuable pursuant to the agreements listed
on the cover page of such Registration Statement and of our report dated
November 22, 1996 with respect to the financial statements and schedules of
UV Systems Technology Inc. as of August 31, 1996 included in the Form 10-SB
for Service Systems International Ltd. filed with the Securities and Exchange
Commission.

/s/ ELLIOTT, TULK, PRYCE, ANDERSON

ELLIOTT, TULK, PRYCE, ANDERSON

Vancouver, British Columbia, Canada
September 26, 1997

<PAGE>

[LETTERHEAD]

REPORT OF INDEPENDENT AUDITORS

Shareholders and Board of Directors
Service Systems International, Ltd.

We have audited the accompanying balance sheet of Service Systems
International, Ltd. (a development stage Company) as of August 31, 1996,
and the related statements of operations, stockholders' equity, and cash
flows for the period from inception (September 31, 1995) to August 31,
1996. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on
these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates by management, as well as evaluating the
overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Service Systems
International, Ltd. (a development stage Company) as of August 31, 1996,
and the results of its operations, and its cash flows for the period from
inception (September 31, 1995) to August 31, 1996, in conformity with
generally accepted accounting principles.

Winter, Scheifley & Associates, P.C.
Certified Public Accountants

Englewood, Colorado
March 11, 1997

<PAGE>

SERVICE SYSTEMS INTERNATIONAL, LTD.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
AUGUST 31, 1996

ASSETS
1996
Current Assets:
Cash $ 56,988
Stockholder advance 192

----------

Total current assets 57,180

Property and equipment, at cost 43,600

Notes receivable - affiliate 125,000

----------

$ 225,780

----------
----------

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
Loans from stockholders $ 81,833

----------

Total current liabilities 81,833

----------

Commitments and contingencies (Note 5)

Stockholders' equity:

Common stock, $.001 par value,
50,000,000 shares authorized,
3,348,000 issued and outstanding 3,346
Additional paid-in capital 382,344
Foreign exchange translation adjustment (527)
(Deficit) accumulated during development stage (241,218)

----------

143,947

----------

$ 225,780

----------
----------

See accompanying notes to financial statements.

<PAGE>

SERVICE SYSTEMS INTERNATIONAL, LTD.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
FOR THE PERIOD FROM INCEPTION (SEPTEMBER 1, 1995) TO AUGUST 31, 1996

General and administrative expenses $ 241,218

----------

Net income (loss) $ (241,218)

----------
----------

Earnings (loss) per share:
Net income (loss) $ (0.08)

----------
----------

Weighted average shares outstanding 3,063,833

----------
----------

See accompanying notes to financial statements.

<PAGE>

SERVICE SYSTEMS INTERNATIONAL, LTD.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM INCEPTION (SEPTEMBER 1, 1995) TO AUGUST 31, 1996
---------------------------------------------------------------------

<TABLE>
<CAPTION>
Deficit Foriegn
Additional Accum. during Exchange
Common Stock Paid-in Development Translation
ACTIVITY Shares Amount Capital Stage Adjustment
-------- ------ ------ ------- ----- ----------
<S> <C> <C> <C> <C> <C> <C>
Balance at inception 1,400,000 $1,400 ($1,400)

Issuance of stock for merger costs
August 1995 @ $ 0.05 1,600,000 1,600 78,400
Issuance of stock for services
November 1995 @ $ 0.50 10,000 10 4,990
ISSUANCE OF STOCK IN PRIVATE SALES
October 1995 @ $ 0.50 20,000 20 9,980
April 1996 @ $ 1.33 38,000 38 50,654
June 1996 @ $ 1.25 44,000 44 54,956
July 1996 @ $ 0.75 220,000 220 164,780
July 1996 @ $ 1.25 16,000 16 19,984

Effect of Foreign exchange transactions
for the period (527)

Net (loss) for the Period (241,218)

------------- ---------- ------------ -------------- ---------
Balance, August 31, 1996 3,348,000 $3,348 $382,344 ($241,218) ($527)
------------- ---------- ------------ -------------- ---------
------------- ---------- ------------ -------------- ---------
</TABLE>

See accompanying notes to financial statements
<PAGE>

SERVICE SYSTEMS INTERNATIONAL, LTD.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
FOR THE PERIOD FROM INCEPTION (SEPTEMBER 1, 1995) TO AUGUST 31, 1996
---------------------------------------------------------------------

<TABLE>
<S> <C>
Net income (loss) $ (241,218)
Adjustments to reconcile net income to net cash
provided by operating activities:
Stock issued for services 85,000
Foreign exchange translation adjustment (527)
Increase in advance to stockholder (192)
----------
Total adjustments 84,281
----------
Net cash provided by (used in) operating activities (156,937)

Cash flows from investing activities:
Acquisition of plant and equipment (43,600)
Increase in notes receivable (125,000)
----------
Net cash provided by (used in) investing activities (168,600)

Cash flows from financing activities:
Common stock sold for cash 300,692
Increase in stockholder loans 81,833
----------
Net cash provided by (used in) financing activities 382,525
----------
Increase (decrease) in cash 56,988
Cash and cash equivalents, beginning of period -
----------
Cash and cash equivalents, end of period $ 56,988
----------
----------
Supplemental cash flow information:
Cash paid for interest $ -
Cash paid for income taxes $ -
</TABLE>

See accompanying notes to financial statements

<PAGE>

SERVICE SYSTEMS INTERNATIONAL, LTD.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS

Note 1. Business and Significant Accounting Policies

BUSINESS
The Company was incorporated in the State of Nevada in August 1990 and remained
inactive until the initiation of a marketing distribution agreement in September
1995 with UV Systems Technology Inc., a manufacturer of equipment using
ultraviolet light technology in water purification systems. The Company is
currently in its development stage which began concurrently with the above
described agreement. The initiation of Company's current business was
accompanied by a change of ownership and deficits accumulated prior thereto have
been reclassified as a reduction of paid-in-capital. Sales are expected to
begin in within the next fiscal year.

CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash on hand, in banks and all highly liquid
investments with a maturity of three months or less when purchased. Cash
equivalents are stated at cost which approximates market.

PROPERTY AND EQUIPMENT
Property and equipment, which consists of a demonstration unit of the product to
be marketed by the Company, is recorded at cost. Depreciation, when begun, will
be computed using the straight line method using an estimated useful life of
five years.

REVENUE RECOGNITION
Sales will be recognized at the time goods are shipped.

ADVERTISING EXPENSES
Advertising expenses are charged to expense upon first showing. The Company
incurred $94,825 of advertising and promotion expenses during the period
presented related to establishing its corporate identity.

INCOME TAXES
The Company has adopted the provisions of Financial Accounting standards Board
Statement No. 109 (Statement No. 109), Accounting for Income Taxes. Statement
No. 109 requires that deferred taxes reflect the tax consequences on future
years of differences between the tax bases of assets and liabilities and their
financial reporting amounts. At the date of adoption of Statement No. 109,
there was no material effect on the Company's financial statements. As of
August 31, 1996 the Company has accumulated net operating losses available to
offset future taxable income of approximately $240,000 expiring in 2010.

Deferred tax assets, approximately $81,000, which may arise from the utilization
of the operating losses have been fully reserved as such utilization is not
assured. The deferred tax asset and related

<PAGE>

reserve applicable to the 1996 operating loss was approximately $81,000.

ESTIMATES
The preparation of the Company's financial statements requires management to
make estimates and assumptions that effect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from these
estimates.

EARNINGS PER SHARE
The earnings per share is computed by dividing the net income (loss) for the
period by the weighted average number of common shares outstanding for the
period. Common Stock equivalents are excluded from the computation if their
effect would be anti-dilutive.

CONCENTRATION OF CREDIT RISK
Financial instruments that potentially subject the Company to a concentration of
credit risk consist principally of cash and notes receivable. During the year
the Company did not maintain cash deposits at financial institutions in excess
of the $100,000 limit covered by the Federal Deposit Insurance Corporation.

Note 2. Development Stage Company

The Company is in its development stage which began on September 1, 1995. In
a development stage company, management devotes most of its activities to
establishing a new business. Planned principle activities have not yet
produced significant revenue. The ability of the Company to emerge from the
development stage with respect to its planned principal business activity is
dependent upon its successful efforts to raise additional equity financing
and develop the market for its products.

Note 3. Loans from Stockholders

Stockholder loans at August 31, 1996 consist of the balance due to an individual
and a related company for cash advances to the Company aggregating $98,448 net
of repayments of $16,615. The loans are due currently and bear no interest.

Note 4. Stockholders' Equity

During the periods covered by these financial statements the Company issued
shares of common stock without registration under the Securities Act of 1933.
Although the Company believes that the sales did not involve a public offering
of its securities and that the Company did comply with the "safe harbor"
exemptions from registration under section 4(2), it could be liable for recision
of the sales if such exemptions were found not to apply. The Company has not
received a request for rescission of shares nor does it believe that it is
probable that its shareholders would pursue rescission nor prevail if such
action were undertaken.

<PAGE>

In connection with the change of ownership discussed in Note 1., the Company
issued 1,600,000 shares of its restricted common stock to the certain
individual stockholders, including an officer of the Company, as
reimbursement of cash advanced by them to others in for expenses related to
the merger. The expenses of the merger ($80,000) were charged to operations
during the period presented.

During October 1995 the Company sold 20,000 shares of its restricted common
stock to one individual for cash at $.50 per share and issued an additional
10,000 shares to another individual for services provided to the Company.
The shares issued for services were valued at $.50 per share.

During April 1996 the Company sold 38,000 shares of its restricted common stock
to one individual for cash at $1.33 per share.

During June 1996 the Company sold 44,000 shares of its restricted common stock
to two individuals for cash at $1.25 per share.

During July 1996 the Company sold 246,667 shares of its restricted common stock
to two individuals and an unrelated corporation for cash at $.75 per share.

Note 5. Notes Receivable - Affiliate

Through August 31, 1996 the Company made advances to UV Systems Technology
Inc., (UV) in the amount of $125,000 pursuant to a funding agreement between
the companies. The agreement, entered into on July 16, 1996, provides for the
funding of 50% of UV's cash operating needs for a six month period during which
time the companies plan to complete a proposed merger. The advances are
evidenced by promissory notes issued to the Company by UV. The notes provide
for accrual of interest at 20% per annum, however the Company has not recorded
interest income from the notes. The notes also provide that if the Company
fails to complete the merger by , then the notes will be canceled
with repayment by UV.

<PAGE>

"MARKETING DISTRIBUTION AGREEMENT"

THIS AGREEMENT made the 21st day of September, 1995,

BETWEEN

UV SYSTEMS TECHNOLOGY INC. of
2800 Ingleton Avenue
Burnaby, British Columbia
Canada V5C 6G7

("Manufacturer")

AND
SERVICE SYSTEMS INTERNATIONAL, LTD.
12840 16th Avenue, Ste. 203
White Rook, BC
Canada V4A 1N6

("Distributor")

NOW IT IS HEREBY AGREED AS FOLLOWS;

1.0 DEFINITIONS

1.1 'The Products' shall mean that list of equipment which is set out in
Schedule 1 hereto.

1.2 'The Territory' shall mean the States of California, New Mexico,
Arizona, Utah, Colorado, Montana, Idaho, and Alaska, U.S A.

1.3 'The Technology' shall mean that list of information and data which is
set out in Schedule 2 hereto.

page 1

<PAGE>

2.0 APPOINTMENT

2.1 The Manufacturer hereby appoints the Distributor as its Marketing
Distributor for the promotion and sale of the Products within the
Territory.

2.2 The relationship between the Manufacturer and the Distributor shall be
that of a seller and a buyer and the Distributor shall not make any
commitment, representation or warranty which would bind the
Manufacturer and shall not otherwise purport to represent or act on
behalf of the Manufacturer.

3.0 DISTRIBUTOR'S OBLIGATIONS

3.1 The Distributor shall use all reasonable endeavour to promote the sale
of the Products within the Territory and shall identify projects where
use of the Products would be appropriate and such sales shall not be
limited to projects where the Distributor is directly involved but
will include projects where sales may be effected to organizations
which are in direct competition to the Distributor.

3.2 During the term of this Agreement the Distributor shall not directly
or indirectly promote within the Territory any equipment which is
similar to or in competition with the Products.

3.3 The Distributor shall not promote the sale of the Products outside the
territory and shall refer to the Manufacturer any enquiry for the
Products which is received from outside the Territory.

3.4 Neither the Manufacturer nor the Distributor shall assign the benefit
of this Agreement without the prior written consent of the
Manufacturer.

page 2

<PAGE>

4.0 MANUFACTURER'S OBLIGATIONS

4.1 The Manufacturer shall manufacture the Products using good engineering
practice and to the reasonable satisfaction of the Distributor.

4.2 Provided that the Distributor has supplied accurate information the
Manufacturer warrants that the Products will perform to the standard
specified by the Distributor and will be in every respect fit for the
purpose for which they are intended.

4.3 The Manufacturer shall promptly reply to all reasonable requests for
technical assistance and quotations which may be made by the
Distributor.

4.4 Upon the signing of this Agreement the Manufacturer shall supply the
Technology and allow the Distributor to make use of it for the
purposes of this Agreement.

4.5 For the term of this Agreement the Manufacturer shall not enter into
any agreement with any person, company or organization other than the
Distributor which would result in the Products being sold or
distributed within the Territory.

4.6 The Manufacturer shall supply the Products in accordance with the
terms of the Manufacturer's quotation.

page 3

<PAGE>

5.0 TERM

5.1 Unless previously terminated the term of this Agreement shall be three
years from the date thereof and such term shall be automatically
extended from year to year until either the Manufacturer or the
Distributor give to the other six months' notice of termination. Such
notice shall be in written form.

6.0 TERMINATION

6.1 If either the Manufacturer or the Distributor shall become insolvent
or have a receiving order made against them or become subject of
proceedings for their compulsory winding up or enter into voluntary
liquidation (other than for the benefit of its members) or enter into
administrative receivership then the Manufacturer or the Distributor
may forthwith terminate this Agreement by giving written notice
thereof to the other.

6.2 If either the Manufacturer or the Distributor should commit any breach
of their obligations under this Agreement and such breach is not
remedied within 30 days of the giving of a written notice requiring
such breach to be remedied then either the Manufacturer or the
Distributor may forthwith terminate this Agreement by giving written
notice thereof.

page 4

<PAGE>

7.0 EFFECTS OF TERMINATION

7.1 If this Agreement terminates pursuant to the provisions of clause
5.0 or pursuant to the provision of clause 6.0 hereof where there
has been default on the part of the Manufacturer then the
Manufacturer shall:

i) supply those of the products which have been ordered by the
Distributor at the date of termination

ii) supply the Products and provide the Technology in respect of
orders received by the Distributor prior to the date of
termination

iii) supply such spare for the Products as may be ordered by the
Distributor up to 60 days after the date of termination

7.2 If this Agreement is terminated for any reason then the
Distributor shall forthwith return the Technology to the
Manufacturer and cease all use of it.

page 5

<PAGE>

8.0 FORCE MAJEURE

8.1 Neither the Manufacturer nor the Distributor shall be responsible each
to the other in respect of any matter arising out of any circumstances
which constitute Force Majeure or any circumstances which are outwith
the reasonable control of either the Manufacturer or the Distributor
and which prevent or impede the due performance of this Agreement
including but not limited to the following matters:

a) war or hostilities

b) riot or civil commotion

c) earthquake, flood, fire or other natural physical disaster

d) the mere shortage of labour caused by any strike or lock-out or
other industrial action shall not constitute Force Majeure.

8.2 If any obligation under this Agreement is materially affected by a
circumstance which constitutes Force Majeure the affected party shall
forthwith give notice thereof to the other and shall thereupon be
excused the further performance of its obligations under this
Agreement or under any order for the Products for such time as the
Force Majeure exists.

9. CONFIDENTIALITY

9.1 Both the Manufacturer and Distributor agree to be bound by the
provisions of the non-disclosure agreement entered into by them and
dated September 15, 1995.

page 6

<PAGE>

10.0 PAYMENT

10.1 The Distributor shall pay for the Products by way of cheque or
telegraphic transfer as required on terms to be mutually agreed
upon and the rendering of an invoice from the Manufacturer other
than where specific terms of payment are agreed in any order for
the Products or identified in any quotation provided by the
Manufacturer.

11.0 PATENTS

11.1 The Manufacturer hereby warrants that in supplying the Products and
the Technology it does not breach any patent, copyright or
intellectual property right and further indemnifies the Distributor
against any loss, damage or costs which may arise from any breach of
such warranty.

12.0 VALIDITY

12.1 If any provision of this Agreement is found or deemed to be
invalid then it shall not affect the validity of the Agreement
generally.

Signed on behalf of the Manufacturer )
UV SYSTEMS TECHNOLOGY INC. )
)
/s/ D.F. Sommerville )
- ------------------------------------ )
by: D.F. Sommerville )
President )

Signed on behalf of the Distributor )
SERVICE SYSTEMS INTERNATIONAL LTD. )
)
/s/ Ken Fielding )
- ------------------------------------ )
by: Ken Fielding )
President )

page 7

<PAGE>

SCHEDULE 1

THE PRODUCTS

1. Ultraviolet lamps - both Low Pressure Low Intensity, and High Intensity
High Efficiency types.

2. Quartz glass sleeves.

3. Electrical control equipment.

4. Monitoring equipment.

5. Ultraviolet Sterilizers incorporating both Low Pressure Low Intensity UV
Lamps and High Intensity High Efficiency UV Lamps.

6. Ultraviolet Disinfection Systems suitable for.

- sewage effluent discharge
- combined storm sewer overflows (C.S.O.)
- industrial wastewater
- process water
- potable water
- sea water

7. Module cleaning system in situ.

8. Module cleaning system bath type.

9. Operation and maintenance manuals.

page 8

<PAGE>

SCHEDULE 2

THE TECHNOLOGY

1. General Arrangement drawings covering mechanical and electrical suitable
and sufficient for installation and servicing of the Products.

2. Dosage rate calculations compatible with current EPA Data.

3. Design calculations compatible with current EPA Data.

4. Details of cleaning methods sufficient to effect repairs and removal for
service.

5. Details of "mix" rates of all cleaning chemicals together with any
hazard/health warnings as appropriate.

6. Details of UV lamp operating data including electrical input/output, UV at
253.7 nanometres (nm).

page 9

<PAGE>

SALES REPRESENTATION AGREEMENT

RESTRICTED AGENT

AGREEMENT, made this day of [Date agreement made]

BETWEEN:

UV SYSTEMS TECHNOLOGY INC.

with offices at:

2800 Ingleton Avenue
Burnaby, British Columbia, Canada V5C 6G7

(hereinafter referred to as "The Company"),

AND: [Name of representative]

with offices at:

[Address of representative]

(hereinafter referred to as "The Representative"):

1. The Company hereby appoints The Representative as its restricted agent
to sell in the Territory and in the Markets set forth in and limited by Exhibit
A, the products set forth in Exhibit C (referred to as the "Product" or the
"Products"), and such other products as The Company may designate in writing to
The Representative. The Representative hereby accepts such appointment and
agrees to exert its best efforts in selling and promoting the sale of the
Products to customers or potential customers in the Territory.

2. It is understood that The Representative is appointed as a restricted
agent and as herein described. It is agreed that The Company at its sole option
and discretion, can exercise the right on giving due notice to The
Representative, to terminate this agreement and to appoint an exclusive
manufacturing and/or distributing and/or marketing and/or sales licensee for the
territory, and/or appoint other representatives or agents in the territory. The
Representative agrees it has no rights to obstruct or take recourse against The
Company

<PAGE>

-2-

under such appointments, and it is understood and agreed that The Company has no
obligations to The Representative in the event such appointments are made, save
as to the payment of due commissions as further defined in this agreement. The
Company undertakes to refer The Representative to any appointed licensee, but
makes no commitment as to any continuance of The Representative's appointment
with respect to the licensee. Where The Company exercises its right to appoint
additional representatives or agents in the territory, it is agreed that The
Representative shall be protected and compensated at the rate of up to, but not
exceeding one-third of the due commission on the sale for all sales not
initiated by The Representative within a 100-mile radius of The Representative's
home office. Similar provisions shall apply in favour of The Representative for
sales initiated by The Representative in other areas of the territory covered by
The Company's appointed representatives. Where protected areas overlap, the
dividing line in the areas shall be the mid distance between the respective home
offices.

3. The Company shall pay to The Representative as its entire compensation
for its services under this Agreement a sales commission, as set forth in
Exhibit C of the net proceeds of sales for the Products sold to the Customer
Accounts during each calendar year during the term of this Agreement. The term
"net proceeds of sales" means the gross amount actually paid by the Customer
Accounts to The Company for the Products shipped to or delivered in the
Territory less all discounts, rebates, returns or allowances, claims, shipping
charges, taxes, duties and any other normal expenses incurred by The Company in
the shipment or attributable to the shipment of the Products sold hereunder. The
commission shall be paid within thirty (30) days after receipt of payment. No
order shall be final and binding until accepted by The Company and such
acceptance communicated to The Representative.

4. This Agreement shall be in effect for the period of one (1) year from
[Beginning date], to [Ending date], and then year to year thereafter, provided,
however, that The Company or The Representative may terminate this Agreement at
any time upon the giving of thirty (30) days prior written notice by The Company
or ninety (90) days prior written notice by The Representative to the other
party hereto. This agreement shall be renewed each year unless either The
Company or The Representative give thirty (30) days prior written notice by The
Company or ninety (90) days prior written notice by The Representative of
termination of the agreement. In the event of such termination, The Company
shall continue to pay The Representative commissions at the rate herein provided
on all orders on the books of The Company for the Products obtained and secured
by The Representative and accepted by The Company prior to the effective date of
termination of this Agreement.

5. The Company shall have the right to reject orders for the Product or the
Products written by The Representative should The Company reasonably believe
that such customer

<PAGE>

-3-

is not creditworthy or should the selling price be less than The Company's list
price for the Product or the Products at the time the order is placed. It shall
be within the sole discretion of The Company to determine prices and terms of
payment with respect to the Products.

6. The Company shall be responsible for billing customers whose orders are
accepted and to whom the Products are delivered under the provisions of this
Agreement. All payments for the Products shall be made directly to The Company
unless The Company otherwise instructs The Representative in writing. Any
payment received by The Representative shall be held for The Company, and The
Representative shall transmit the amount thereof to The Company. The
Representative agrees to reasonably assist The Company at The Company's expense
in making collections of all delinquent accounts on which The Representative
will be entitled to receive commission payments. Nothing contained in this
Agreement shall be construed to obligate The Representative to guarantee payment
for the Products or to institute any action or collection process.

7. The Representative shall at no time be deemed a purchaser of the
Products or have any right, title or interest in the Products or the proceeds
derive from the sale of the Products except for The Representative's right to
receive its sales commission.

8. The Representative shall at its own expense, employ sales personnel and
provide technical and sales service and other employees as may be necessary to
properly perform its functions pursuant to this Agreement, and all such sales
and technical personnel and other employees shall be the employees of The
Representative. No such sales person or employee of The Representative shall be
deemed, expressly or by implication, to be an employee of The Company for any
purpose, including without limitation, for the purpose of any tax or charge
levied or imposed by any federal or state law with respect to employment,
salaries, wages, or remuneration or employment, or otherwise, or for any
purpose whatsoever.

9. All salaries and expenses for the operation of The Representative's
office and activity as an independent agent, including, but not limited to,
office rent, heat, light, telephone, telegrams, travel, supplies, stenographic
and clerical assistance, salesmen, technical representatives, licenses, taxes,
fees, automobiles, insurance, and the like, shall be borne by The Representative
and The Representative shall be solely responsible for the payment of the same.

10. The Company shall furnish The Representative with sufficient quantities
of sales literature, samples, laboratory support and other selling tools as
necessary in The Company's reasonable judgement for The Representative to
function as a sales agent under this Agreement, and shall reasonably cooperate
with The Representative to function as a sales agent under this Agreement, and
shall reasonably cooperate with The Representative in

<PAGE>

-4-

performance of The Representative's services under this Agreement.

11. The Representative shall not use The Company's name or trademark, Ultra
Guard-TM- and/or "the blue wavy lines", in public literature, except (i) in
connection with the sale of the Products; (ii) in literature which The Company
may furnish The Representative; or (iii) as The Company may otherwise approve in
writing. Upon termination of this Agreement, The Representative shall have no
further right to use The Company's name or trademarks in any literature or in
any other manner or form. The Representative shall not make any claims,
warranties or agreements, either express or authorized in writing by The Company
so to do. The Representative further agrees to comply with the rules and
instructions of The Company related in the offering for sale of the Products and
to make such reports to The Company as may be requested by The Company from time
to time.

12. It is agreed that The Representative is an independent sales agent,
and, except as provided in this Agreement, The Company shall exercise no control
over the conduct of The Representative's business, and The Company shall not be
responsible for any act or omission on the part of The Representative or its
employees in the conduct of such business.

13. Each party agrees to act at all times in a manner that will uphold the
good name and reputation of the other party. During the term of this Agreement,
The Representative agrees that it will not represent or offer for sale to the
Customer Accounts any product of any other manufacturer which competes with the
Products without the express written consent of The Company.

14. Upon the termination of this Agreement, all samples, technical and
engineering information and other information and data furnished by The Company
to The Representative shall be returned by The Representative to The Company.

15. During the term of this Agreement and for a period of three (3) years
following the termination of this Agreement, The Company and The Representative
agrees that it will treat as confidential and not divulge or make use of any
trade secrets or other confidential information belonging to the other party
hereto, including but not limited to the prices charged for The Company's
products, sales agreements negotiated, sales agreements about to be consummated,
The Company's processes, patented know-how or inventions or other confidential
information developed during the period of this Agreement. The Representative
shall sign Company's "non-disclosure agreement." The Company and The
Representative shall cause its employees and agents to be bound by this
agreement of confidentiality.

16. Performance by The Company and The Representative under this Agreement
of obligations shall be excused for the duration of any of the following: (a)
act of God; (b) war;

<PAGE>

-5-

(c) riot; (d) explosion; (e) flood; (f) lock-out; (g) strike; (h) injunction;
(i) government action; (j) inability to obtain or use fuel, power, raw materials
or materials in intermediate or finished form, labor, containers, or
transportation facilities; (k) accident; (l) breakage of machinery or apparatus;
or (m) national emergency, or any other occurrence not within its control, which
either prevents the shipment or acceptance of a shipment of the Products.

17. This Agreement terminates and supersedes all prior agreements of any
kind, if any, between The Company and The Representative.

18. This Agreement shall be interpreted and governed by the laws of the
Province of British Columbia, Canada.

19. The failure of either party to enforce at any time, or for any period
of time, any provision of this Agreement shall not be construed as a waiver of
such provision or of the right of such party thereafter to enforce this
Agreement or any provision thereof.

20. This Agreement contains the entire understanding of the parties and is
the only agreement between the parties respecting the matters set forth in this
Agreement, and any representations, promises or conditions in connection with
this Agreement not incorporated in this Agreement shall not be binding on either
party.

21. The Representative shall not assign its rights nor delegate the
performance of its duties pursuant to this Agreement without the prior written
consent of The Company.

22. This Agreement may be executed in counterparts, each of which
constitute the entire Agreement between the parties.

23. The Company shall save The Representative harmless from and against
liability, loss, costs, expenses and damages caused by the use of the Products
(1) resulting in personal injury or property damage to any person, (2) resulting
in infringement of any patent rights or other rights of third parties or (3)
resulting in any violation of municipal, state, provincial, or federal law or
regulation governing the Products, which result from the distribution of the
Products pursuant to this Agreement; provided, however, that this indemnity
shall not be applicable if such liability, loss, cost, expense or damage is
caused, in whole or part, by the negligence, misrepresentation or misconduct of
The Representative or a breach of The Representative's obligation under this
Agreement.

24. Except as provided below, any controversy or claims arising out of or
relating to this Agreement or the breach thereof, may at the option of either
party be settled in accordance with the then existing rules of the Canadian
Arbitration Association, such

<PAGE>

-6-

arbitration to be conducted in Vancouver, British Columbia, Canada, and,
judgment upon the award may be entered in any court having jurisdiction. Except
for the arbitration proceedings under the immediately preceding sentence, the
parties consent and agree that exclusive jurisdiction for commencement of any
suit or action under this Agreement shall lie in the provincial courts serving
British Columbia, Canada, provided, however, that the parties' agreement with
respect to the exclusive jurisdiction of the courts serving British Columbia
shall not apply to situations involving third party lawsuits.

<PAGE>

-7-

IN WITNESS WHEREOF, the parties hereto have signed this Agreement on the
day and year first above written.

THE COMPANY:

UV SYSTEMS TECHNOLOGY INC.

BY John R. Gaetz
------------------------------
TITLE Executive Vice President

THE REPRESENTATIVE:

[NAME OF REP IN CAPS]

BY [Name of signing officer]
------------------------------
TITLE [Title of signing officer]

<PAGE>

-8-

EXHIBIT A

TERRITORY AND MARKETS

[Territory]

<PAGE>

-9-

EXHIBIT B
PRODUCTS

TYPE: Low-pressure, high-intensity, high-efficiency ultraviolet source, water
and wastewater treatment systems.

DESCRIPTION: Includes any and all equipment supplied wherein the method of
disinfection incorporates an Ultra Guard-TM- AC-type, high-intensity,
high-efficiency ultraviolet germicidal lamp/lamps. The Company reserves the
right to supply systems or products wherein the equipment will be powered by
medium-pressure, high-intensity UV lamps.

TYPE: Low-pressure, low-intensity ultraviolet source, water and wastewater
treatment systems.

DESCRIPTION: Includes any and all equipment supplied wherein the method of
disinfection incorporates low-pressure, low-intensity UV lamps of the G36T5L or
G64T5L type. The Company reserves the right to supply lamps as manufactured by
others.

Products to be supplied will include the following items, but will not
necessarily be restricted to products manufactured by The Company.

Ultraviolet sterilizers;
Ultraviolet disinfection systems;
Ultraviolet lamp controllers;
Ultraviolet lamps;
Related equipment.

The Representative's responsibility is to introduce and market The
Company's products within its identified territory. The relationship will be
that of manufacturer and manufacturer's agent/representative.

The Company will undertake to submit offers, bids and pricing to clients
identified by The Representative on a direct basis.

The Company will supply at no cost to The Representative, all sales
materials, brochures, and catalogues to assist in marketing efforts within the
defined territory.

<PAGE>

-10-

EXHIBIT C

COMMISSION SCHEDULE

The commission schedule will cover the complete range of products
manufactured by The Company and broken out into three specific product
ranges defined as Item 1, Item 2, and Item 3 below.

Item 1: High-intensity, high-efficiency ultraviolet disinfection systems.
Item 2: Low-intensity ultraviolet disinfection systems.
Item 3: All replacement ultraviolet lamps.

REF. ITEM 1:

The commissions payable on products supplied under this item will be as
follows, and are cumulative and not specific:

Can $0-100 thousand. . . . . . . . . . . . . . .10%
Can $100-300 thousand. . . . . . . . . . . . . .7.5%
Can $300-500 thousand. . . . . . . . . . . . . . 5%
Can $500 thousand and over . . . . . . . . . . . 3%

REF. ITEM 2:

The commissions payable on products supplied under this item will be as
follows:

Regardless of value. . . . . . . . . . . . . . .15%

REF. ITEM 3:

The commission payable on all ultraviolet lamps, low-intensity,
low-pressure, medium-pressure, high-intensity, high-intensity,
high-efficiency supplied under this item will be as follows:

Regardless of Value. . . . . . . . . . . . . . .10%

There will be no accumulative totals; each project or order will be
considered a stand-alone item.

<PAGE>

EXCLUSIVE DISTRIBUTORSHIP AGREEMENT

This agreement dated the 12th day of October, 1995

BETWEEN

UV WATERGUARD SYSTEMS INC., of
2800 Ingleton Avenue
Burnaby, BC V5C 6G7
(a company incorporated under the laws of
British Columbia)

("SELLER")

AND

CHIYODA KOHAN CO., LTD., of
Kacho Bldg., 7-16-7 Ginza
Chuo-Ku
Tokyo 104, Japan
(a company incorporated under the laws of Japan)

("C-K")

AND

NIMAC CORPORATION, of
7th Fl., Landic Akasaka
3-4, Akasaka 2-Chome
Minato-Ku
Tokyo 107, Japan
(a company incorporated under the laws of Japan)

("NIMAC")

Effective August 17, 1995, UV Systems Technology Inc.
assumed this contract from UV Waterguard Systems Inc.

-1-
<PAGE>

WITNESSETH

WHEREAS, SELLER has been engaged in the manufacture and marketing of the
Products (as hereinafter defined) and desires to expand the sale of same;

WHEREAS, among other things, NIMAC is engaged in importing various
products and C-K is engaged in distributing and marketing various products in
Japan;

WHEREAS, NIMAC desires to act as, and SELLER desires to appoint NIMAC as,
the sole and exclusive importer of the Products in the Territory (as
hereinafter defined); and,

WHEREAS, C-K desires to act as, and NIMAC desires to appoint C-K as
exclusive distributor of the Products in the Territory.

NOW, THEREFORE, the parties hereto agree as follows:

ARTICLE 1. DEFINITIONS

The following words shall have the following meanings when used in this
Agreement:

1.1 "Agreement" shall mean this Agreement and any amendments hereto.

1.2 "Delivery Point" shall mean FOB NEAREST PORT TO PLACE OF
MANUFACTURE.

1.3 "Individual Contract" shall mean a Purchase Order for the Products
issued by NIMAC.

1.4 "Equipment" shall mean WATERGUARD'S U.V. LAMP SYSTEM FOR USE AND
APPLICATION WITH CHAMBER-TYPE UV EQUIPMENT where transmissions are greater
than 65% transmission and AS FURTHER described in EXHIBIT A hereto or
hereafter manufactured by or at the direction of SELLER, and any and all
modifications and successor models thereof and all new devices developed by
SELLER to accomplish substantially the same purposes.

-2-
<PAGE>

1.5 "Marks" shall mean all trademarks, tradenames, emblems, designs,
patents and other intellectual property utilized in connection with the
Products (and identified in EXHIBIT B annexed hereto) and any abbreviation
and modification thereof.

1.6 "Parts" shall mean replacement parts for, or components of, the
Equipments.

1.7 "Product(s)" shall mean, as applicable, the Equipment and/or Parts.

1.8 "Purchase Order" shall mean NIMAC'S standard form purchase order AS
ATTACHED HERETO AS EXHIBIT E.

1.9 "Minimum Order Quantity" shall mean the quantity which NIMAC and
C-K shall place orders for with SELLER within three years from the EFFECTIVE
DATE OF THIS AGREEMENT as described in EXHIBIT C.

1.10 "Purchaser(s)" shall mean ultimate purchasers and users of the
Products, as applicable.

1.11 "Territory" shall mean Japan.

1.12 "Distribution Agreement" shall mean the Agreement to be entered
into by NIMAC and C-K for the marketing of the Product in the Territory.

ARTICLE 2: APPOINTMENT

2.1 SELLER hereby appoints NIMAC, and NIMAC accepts the appointment as
SELLER's SOLE AND EXCLUSIVE IMPORTER of the Products into the Territory.

2.2 During the term of this Agreement, SELLER shall not directly or
indirectly (i) sell, distribute, market, lease or otherwise make available
the Products within the Territory except through NIMAC or (ii) grant a
licence to, without prior notice and acceptance from NIMAC, to anyone other
than NIMAC for the sale of the Products.

2.3 SELLER shall promptly refer to NIMAC all inquiries for the Products
originating in or for delivery to the Territory.

-3-
<PAGE>

2.4 SELLER hereby grants NIMAC the right to appoint distributor for
marketing of the Product within the Territory under terms determined by NIMAC
and such distributor. Pursuant to such right, NIMAC hereby appoints C-K as
distributor for market of the Product within the Territory, and C-K hereby
accepts such appointment.

2.5 Nothing contained herein shall be construed or deemed to make the
parties hereto joint venturers or partners or to constitute any party an
agent or employee or the other. None of the parties shall at any time make
any representation, in writing or orally, that it is an agent, partner or
joint venturer with the other. None of the parties shall have the right,
power or authority to assume or create any obligation, express or implied, on
behalf of any of the other.

2.6 SELLER grants to NIMAC and C-K an exclusive option, for a period of
one (1) year from date of this agreement rights to market and sell open
channel systems for the disinfection of wastewater and/or sewage effluent
wherein the transmission of the fluids is less than 65%. Each party mutually
agrees to refer such enquiries to the other as they arise.

2.7 Should the parties to this Agreement be unable to conclude an
agreement covering marketing and sales rights to open channel systems, SELLER
shall have the right at its sole option to appoint another company to
represent the products in the Territory.

ARTICLE 3: PURCHASE AND SALE; PRICE; PAYMENT; INSPECTION; DELIVERY

3.1 Subject to the other terms and conditions of this Agreement, SELLER
shall sell to NIMAC, and NIMAC shall purchase from SELLER the Products. Such
purchase and sale shall be in accordance with this clause 3.1.

3.1.1 The sale and purchase of the Products hereunder shall be based on
the terms and conditions set forth herein and in the applicable Purchase
Order, PROVIDED that if any discrepancy should occur between the terms and
conditions of this Agreement and those set out in the printed portion of the
Purchase Order, this Agreement shall prevail. An individual Contract for the
Products shall be deemed to have been made when NIMAC receives SELLER's
acceptance of the Purchase Order, such acceptance being indicated by SELLER's
countersignature on the Purchase Order,

-4-
<PAGE>

SELLER's issuance of a sales confirmation or similar document, SELLER's
acquiescence, SELLER's delivery of the Products or the like, PROVIDED that if
any terms in such sales confirmation or similar document conflict with, or
supplement, the terms of this Agreement or the Purchase Order, such
conflicting or supplemental terms shall be deemed null and void and the
provisions of this Agreement and Purchase Order shall govern.

SELLER shall endeavor to timely fill all NIMAC orders.

3.1.2 SELLER and NIMAC agree on a Purchase Contract with the list price
and discount rate as described in Exhibit D, which is applicable to sell and
purchase.

3.1.3 SELLER shall deliver and NIMAC shall take delivery of the Products
at the Delivery Point. SELLER shall pack the Products to withstand extensive
international transportation, exposure and handling. Upon such delivery,
title and risk of loss to the Products shall pass to NIMAC.

ARTICLE 4: INSPECTION

Upon reasonable notice to SELLER, NIMAC and/or C-K shall have the right to
inspect, randomly or otherwise, the Products at the place of SELLER, or other
manufacturer of the Products, if any, prior to packing thereof. SELLER shall
timely notify NIMAC of the production schedules for the Products and of the
readiness of Products for packing. Inspection shall be at NIMAC's expense or
the party who makes such inspection. Inspection of any Products by NIMAC or
C-K shall not constitute acceptance thereof nor shall it constitute a waiver
of any claim or right which NIMAC, C-K or Purchasers may have with respect
thereto.

ARTICLE 5: MINIMUM QUANTITY

C-K shall, in accordance with this Agreement, regularly purchase the
Products not less than the annual quantity for each twelve (12) months period
mentioned in the "Annual Order Quantity Schedule" attached hereto as EXHIBIT C
and made a part hereof.

-5-
<PAGE>

ARTICLE 6: PATENTS, TRADEMARKS AND TRADENAMES

6.1 SELLER warrants to NIMAC and C-K and represents that it is the
rightful and legal owner or licensee of all rights, title, and interest to
any and all present or future patents, know-how, trademarks, tradenames,
emblems, designs, copyrights or other intellectual property used in
connection with the manufacture, sale and promotion of the Products.

6.2 SELLER hereby grants to NIMAC and C-K the sole and exclusive right
and license to use all Marks in connection with the promotion, sale and
distribution of the Products, WITHIN THE TERRITORY.

6.3 If SELLER adopts any other trademarks, tradenames and the like in
connection with the Products in the future, SELLER shall notify NIMAC and C-K
immediately thereof and same shall be included in the term "Marks".

6.4 NIMAC and C-K acknowledges that SELLER is the owner or the licensee
of the right to use the Marks. At SELLER's sole expense AND OPTION, SELLER
shall duly register and keep effective in the Territory the Marks and the
exclusive right granted to NIMAC and C-K with respect to the Marks, and shall
take all steps necessary to duly protect the Marks.

ARTICLE 7: SALES PROMOTION; TECHNICAL ASSISTANCE

7.1 NIMAC and C-K shall exert its best efforts to promote the sale of
the Products in the Territory.

7.2 Upon SELLER's request, NIMAC and/or C-K shall furnish SELLER with
reports relating to the sale of Products. Each party shall furnish the other
party with information which is necessary or helpful with respect to the
sales promotion of the Products.

7.3 Upon the request of NIMAC and/or C-K, SELLER shall provide to NIMAC
and/or C-K, free of charge, a reasonable number of samples, catalogs,
brochures and other promotional materials which may be useful to promote the
sale of the Products.

-6-
<PAGE>

7.4 At no cost to NIMAC and C-K, SELLER shall provide NIMAC and C-K
with (i) such technical advice and information as may be desirable for a full
understanding of the Products and (ii) training for a period of FIVE (5)
CONTINUOUS DAYS for FOUR (4) personnel dispatched by NIMAC and/or C-K to
SELLER's facilities. TIME IN EXCESS OF FIVE (5) DAYS SHALL BE PAID FOR AT THE
SERVICE RATE SHOWN ON EXHIBIT D.

7.5 If requested by NIMAC and/or C-K, SELLER shall promptly provide
technical support (including the dispatch of SELLER's qualified personnel) to
ensure the proper installation, calibration and use of the Products and to
provide advice, training and assistance to NIMAC's and C-K's personnel. SUCH
REQUEST FOR TECHNICAL SUPPORT SHALL BE PAID FOR AT THE RATES SHOWN ON
EXHIBIT D, PLUS REIMBURSEMENT OF EXPENSES, AT COST.

ARTICLE 8: WARRANTY

8.1 SELLER hereby warrants to NIMAC and/or C-K THE PRODUCTS against
defects in material and workmanship, and to operate properly at the time of
initial installation in an electrical circuit having the correct
characteristics for control and lamp operation.

8.2 The SELLER shall guarantee to NIMAC and C-K, 1500 hours for lamp
life, and the controller for a period of twelve (12) months from the date of
original installation or eighteen (18) months from delivery to the Delivery
Point, whichever is shorter.

SELLER'S obligation under this warranty or otherwise is expressly limited
to replacement of the merchandise involved, or at its option, refund of any
amount not to exceed the sales price to its original customer for the
merchandise involved, and only when the defects have not been caused by
misuse, neglect, improper installation, alteration, or accident.

8.3 SELLER may require the return of merchandise claimed as defective
for its examination and it shall be the sole judge as to whether material is
in fact defective under the terms of this warranty. A written Material Return
Authorization must be obtained from SELLER prior to the return of any
Products previously purchased from SELLER. All unauthorized returns may be
sent back to NIMAC and/or C-K at

-7-
<PAGE>

NIMAC's and/or C-K's expense. Return shipments must be prepaid. IF THE
RETURNED ITEM IS DETERMINED TO BE DEFECTIVE WITHIN THE TERMS OF THE WARRANTY,
THE COST OF SHIPPING WILL BE REIMBURSED BY SELLER.

8.4 SELLER, at its option after inspection of returned, claimed-
defective Product, will replace Product or credit such Product in
accordance with SELLER's Warranty for the Product involved.

8.5 These alternatives shall be NIMAC's and/or C-K's exclusive
remedies. IN NO CASE WILL SELLER BE LIABLE FOR CONSEQUENTIAL DAMAGES EVEN IF
SELLER HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

8.6 THE FOREGOING WARRANTIES ARE IN LIEU OF ALL OTHER WARRANTIES
EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES
OR MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

Lamps will not be considered for credit which are claimed as defective
more than two (2) years after their date of manufacture.

ARTICLE 9: INDEMNITY

SELLER, AT ITS SOLE OPTION, SHALL DEFEND ANY CLAIM OF infringement of
patent, trademark or tradename rights, provided that NIMAC and/or C-K shall
have informed SELLER thereof. In complying with the provisions of this
Paragraph, SELLER shall actively and at its own expense defend against any
such claim. If in NIMAC's or C-K's sole opinion SELLER fails to mount an
adequate defense to such claim, NIMAC and/or C-K, AT ITS SOLE EXPENSE, shall
have the right to ASSIST SELLER IN ITS DEFENSE.

SELLER's obligations hereunder shall survive the expiration or termination of
this Agreement.

-8-
<PAGE>

ARTICLE 10: CONFIDENTIALITY

None of the parties shall disclose to any person, firm or corporation any
knowledge or information pertaining to, or discerned in connection with this
Agreement, of the conduct or details of the business of the other party,
unless and until such knowledge or information becomes part of the public
domain.

ARTICLE 11: TERM AND TERMINATION

11.1 This Agreement shall commence as of the date first above written
and shall have an initial term of five (5) years, and shall thereafter be
automatically renewed for successive terms of one (1) year each, unless not
less than ONE HUNDRED AND EIGHTY (180) DAYS prior to the expiration of the
THEN CURRENT TERM either party gives the other party written notice
terminating this Agreement upon the expiration of the THEN CURRENT TERM. ANY
PURCHASE ORDERS OR INDIVIDUAL CONTRACTS WHICH ARE OUTSTANDING AT THE TIME OF
TERMINATION, AT THE OPTION OF THE TERMINATED PARTY, MAY BE DELIVERED OR
CANCELLED.

11.2 This Agreement may be terminated by any of the parties upon written
notice to each of the other if (i) the other party fails to fulfill its
material obligations hereunder and such failure is not remedied within thirty
(30) days after its receipt of a written notice requesting a remedy thereof;
or (ii) there is a substantial change in the ownership of control of the
other party.

11.3 This Agreement may be terminated by any of the parties upon written
notice to either party of the other parties if the other party becomes
insolvent or any voluntary or involuntary petition in bankruptcy is filed by
or against such party or a trustee is appointed with respect to any of the
assets of such party, or a liquidation proceeding is commenced by or against
such party AND such party discontinues its business.

11.4 Termination of this Agreement shall not relieve any of the parties
of its obligations incurred prior thereto, or any rights or obligations which
by their terms survive or take effect upon termination. Regardless of the
reasons for termination of this Agreement, all outstanding credits and
liabilities under the warranty provisions hereof shall continue to remain in
force. IN THE EVENT OF TERMINATION DUE TO PROVISIONS CONTAINED WITHIN
CLAUSES 11.2 AND 11.3, NIMAC and C-K shall have the option to

-9-
<PAGE>

accept delivery under or cancel, in whole or in part, any Purchase Orders or
individual Contracts which are outstanding at the time of termination of this
Agreement. Notwithstanding termination, NIMAC and/or C-K may continue to sell
any unsold Products and use the Marks in connection therewith.

11.5 All goodwill developed within the Territory in connection with the
sale and distribution of the Products shall remain the property of NIMAC and
C-K.

11.6 SELLER agrees that for at least one (1) year after the termination,
SELLER shall make available and offer for sale Parts at a reasonable price
and service the Products at a reasonable cost.

11.7 WITHIN ONE YEAR OF TERMINATION OF THIS AGREEMENT, NIMAC AND/OR C-K
SHALL PROVIDE SELLER WITH A COMPLETE LIST OF PRODUCT PURCHASERS, INCLUDING
NAMES, ADDRESSES, PRODUCT DESCRIPTION AND QUANTITY, TO ALLOW SELLER TO
CONTINUE TO SERVICE PURCHASER.

ARTICLE 12: FORCE MAJEURE

None of the parties shall be responsible to the other party for
(nonperformance or) delay in performance under this Agreement and/or any
individual Contract due to acts of God, civil commotion, war, riots, strikes,
lockouts, severe weather, fires, explosions, (transportation delays),
governmental actions or other (similar) caused beyond the control of such
party, PROVIDED that the party so affected shall promptly give notice thereof
to the other party and shall continue to take all action reasonably within
its power to comply herewith as fully as possible.

ARTICLE 13: ARBITRATION AND APPLICABLE LAW

ARBITRATION

All disputes arising out of or in connection with this Agreement, or in
respect of any defined legal relationship associated therewith or derived
therefrom, will be referred to and finally resolved by arbitration under the
rules and procedures of the British Columbia International Commercial
Arbitration Centre except that all proceedings of the arbitration will be in
English.

-10-
<PAGE>

The appointing authority will be the British Columbia International
Commercial Arbitration Centre.

The place of arbitration will be in Vancouver, British Columbia.

Governing Law to this Agreement and its application and interpretation
will be exclusively governed by and construed with the laws prevailing in
British Columbia which will be deemed to be the proper law hereof.

ARTICLE 14: GENERAL PROVISIONS

14.1 This Agreement, except as provided herein, is not assignable by
either party, in whole or in part, without the prior written consent of the
other party, and any attempted assignment or participation without such
approval shall be null and void.

14.2 Any notice made in relation to this Agreement or performance
thereunder shall be in writing and delivered by hand or sent by prepaid
certified mail, return receipt requested, telefax/telex (with a copy by
certified mail) to the following addresses:

If to NIMAC If to C-K
NIMAC Corporation Chiyoda Kohan Co., Ltd.
7th Fl., Landic Akasaka Kacho Bldg., 7-16-7, Ginza
3-4, Akasaka 2-Chome Chuo-Ku
Minato-Ku, Tokyo 107, Japan Tokyo 104, Japan
Attn: Toshio Kimura Attn: K. Shimizu
Telephone No.: 8-3-3588-2690 Telephone No.: 8-3-3542-5292
Facsimile No. 8-3-3588-4918 Facsimile No. 8-3-3541-9377

If to SELLER

Attn: D.F. Sommerville
Facsimile No.: 01-604-451-1072
Telephone No.: 01-604-451-1069

or such other address as the intended recipient previously shall have
designated in writing. All notices hereunder shall be deemed to be made upon
receipt. Rejection or

-11-
<PAGE>

other refusal to accept or the inability to deliver because of change of
address of which no notice was given shall be deemed to be receipt of the
notice sent.

14.3 The provisions of this Agreement shall be deemed to be severable,
and the invalidity of any provision of this Agreement shall not affect the
validity of the remaining provisions of this Agreement.

14.4 The failure of any of the parties hereto to enforce at any time any
of the provisions hereof shall not be construed to be a waiver of such
provisions or of the right of such party thereafter to enforce any such
provisions.

14.5 The paragraph headings herein are for ease of reference only and
are not to be utilized in construing or interpreting this Agreement.

14.6 No provision of this Agreement shall be construed against or
interpreted to the disadvantage of either party hereto by any court or
governmental or judicial authority by reason of such party having or being
deemed to have structured or dictated such provision.

14.7 Whenever the approval or consent of SELLER, NIMAC and/or C-K is
required under this Agreement, such approval or consent shall not be
unreasonably withheld.

14.8 This Agreement constitutes the entire agreement and understanding
of the parties hereto with respect to the subject matter of this Agreement,
and supersedes all prior discussions, agreements and understandings between
the parties with respect to the subject to matter of this Agreement. No
representation or statement not contained in this Agreement shall be binding
on SELLER, NIMAC and C-K as a warranty or otherwise. No amendment of
modification of this Agreement shall be binding on the parties unless made in
writing expressly referring to this Agreement and signed by and authorized
representative of each party.

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<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.

SELLER
------------------------------------

By: UV Waterguard Systems By: NIMAC Corporation
------------------------------- -------------------------------

Name: /s/ D.F. Sommerville Name: /s/ [illegible]
----------------------------- --------------------------
Title: President Title: Deputy General Manager
---------------------------- -------------------------
D.F. Sommerville
----------------------------

By: Chiyoda Kohan Co., Ltd.

Name: /s/ [illegible]
-----------------------------

Title: President
----------------------------

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<PAGE>

EXHIBIT A

Equipment mentioned in Article 1.4 contains the following items manufactured,
produced, and delivered by SELLER.

A. U.V. LAMP

- - model AC 4-100
- - model AC 4-50
- - model AC 4-25
- - model AC 2-50
- - model AC 2-70
- - model AC 2-100

B. CONTROLLER*

- - for control of AC 4-100 lamp
- - for control of AC 4-50 lamp
- - for control of AC 4-25 lamp
- - for control of AC 2-50 lamp
- - for control of AC 2-70 lamp
- - for control of AC 2-100 lamp

*Available to control ANY NUMBER OF LAMPS.

-14-
<PAGE>

EXHIBIT B

MARKS

PRODUCT MODEL NUMBER

LAMPS CONTROL MODULES
----- ---------------
AC 4-100 H4101, H4103, H4106, H4109
AC 4-50 H4051, H4053, H4056, H4059
AC 4-25 H4251, H4253, H4256, H4259
AC 2-50 H2051, H2053, H2506, H2509
AC 2-70 H2071, H2073, H2076, H2079
AC 2-100 H2101, H2103, H2106, H2109

PRODUCT DESCRIPTION/TRADE NAMES

Water [LOGO] Guard

Waterguard

Water Guard

U.V. Waterguard Systems Inc.

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EXHIBIT C

Minimum Order Quantity is agreed and confirmed among SELLER, NIMAC, and C-K
as mentioned hereunder.

1. 20 units (1 each AC 4-100 or AC 4-25 lamp and 1 each controller per unit)
to be purchased by NIMAC and to be delivered to C-K in the first year
after signing Agreement, in the following schedule.

10 units for immediate delivery (approximately 3 months after order)

10 units for delivery within 12 months after signing Agreement.

2. Purchase commitment for minimum quantity purchases and delivery schedule
for second and third year to be negotiated AND CONCLUDED prior to first
year anniversary.

3. Purchase commitment for minimum quantity purchases and delivery schedule
for FOURTH YEAR AND FIFTH YEAR TO BE NEGOTIATED AND CONCLUDED PRIOR TO
THIRD YEAR ANNIVERSARY.

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EXHIBIT D

List price and discounting rate per ordered quantity for the Products are
agreed and confirmed among SELLER and NIMAC, and C-K as mentioned hereunder.

A. Waterguard lamp unit price and discount rate/discount price per ordered
quantity:

model AC 4-100 lamp US$2,047.00
model AC 4-50 lamp US$1,687.00
model AC 4-25 lamp US$1,577.00
model AC 2-50 lamp US$1,397.00
model AC 2-70 lamp US$1,506.00
model AC 2-100 lamp US$1,563.00

QUANTITY DISCOUNT RATE FROM LIST PRICE
-------- -----------------------------

FIRST ORDER:

20 AC 4-25 or AC 4-100 10%

SUBSEQUENT ORDERS:

0 - 50 0%
51 - 150 5%
151 - 250 7.5%
251 - 10%

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B. Waterguard controller price and discount rate/discount price per ordered
quantity:

for control of AC 4-100 lamp US$14,971.00
for control of AC 4-50 lamp US$13,857.00
for control of AC 4-25 lamp US$11,904.00
for control of AC 2-50 lamp US$ 9,692.00
for control of AC 2-70 lamp US$10,620.00
for control of AC 2-100 lamp US$11,278.00

QUANTITY DISCOUNT RATE FROM LIST PRICE
-------- -----------------------------

FIRST ORDER:

20 controllers for AC 4-25 or AC 4-100 20%

SUBSEQUENT ORDERS:

0 - 25 0%
26 - 50 5%
51 - 100 8%
101 - 12%

SELLER agrees to hold prices, not to exceed those shown above, and shall
endeavour to reduce prices based on negotiations with suppliers or on
quantities to be ordered by NIMAC and C-K.

Should the parties to this agreement be unable to reach an agreement on
ongoing prices, the agreement shall be terminated by mutual consent.

SERVICE AND TRAINING
- ---------------------

Daily rate, including travel time: US$1,120.00
Hotel and per diem expense: At cost
Service and air transport expense: At cost

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