PACIFIC SUMMIT SECURITIES
                             111 PACIFICA, SUITE 250
                            IRVINE, CALIFORNIA 92618
                                 (949) 727-2427
                               (949) 727-2428 FAX
                              www.pacificsummit.com


July 27, 2004


Dr. Bogdan Maglich
HiEnergy Technologies, Inc.
Chairman & Chief Scientist
1601B Alton Parkway
Irvine, CA 92606

Dear Dr. Maglich:

Paul and I thoroughly enjoyed our meeting with you and Greg yesterday and we are
very impressed with the technology you have developed. Accordingly, I am pleased
to  present  this  engagement  letter   ("Agreement")   whereby  Pacific  Summit
Securities ("PSS" or the "Firm") will serve as the exclusive  representative for
HiEnergy  Technologies,  Inc.  ("HIET"  or the  "Company"),  in the  raising  of
institutional capital (the "Financing") on a best efforts basis.

Accordingly,  and subject to your approval via your countersignature  below, our
Agreement shall be as follows:

1.   TERM. The term of this Agreement shall be until the Financing is completed,
     or until  terminated  by either party by giving ten days'  written  notice.
     Full  compensation  with regards to Success Fees outlined in this Agreement
     shall  be  paid  if,  within  18  months  after  termination,  a  Financing
     transaction  is entered  into with any party  introduced  by PSS during the
     term  of this  Agreement.  The  Company  to  approve  and  confirm  parties
     introduced during this agreement.

2.   BUSINESS  INFORMATION.  The Company  shall  furnish  complete  and accurate
     current and historical  information  and shall  promptly  notify PSS of any
     material   changes  in  the  business  that  may  affect  the   transaction
     contemplated herein.

3.   CASH SUCCESS FEES.  PSS shall be paid a Cash Success Fee equal to 8% of the
     funds  raised  or  committed  at  closing,  or  invested  by such  investor
     (including  other  parties  introduced   directly  or  indirectly  by  such
     investor)  at any  subsequent  closing  occurring  within a 24 month period

<PAGE>

     following the initial  closing.  Such fees shall be paid in cash out of the
     proceeds of the  Financing(s) at the closing(s).  This Fee shall also apply
     to Company  stock  purchased  from third party  affiliates  pursuant to PSS
     introductions.

4.   EQUITY  FEE.  PSS shall  receive  warrants to  purchase  Common  Stock (the
     "Warrants")  equal to 10% of the shares  underlying the  transaction.  Such
     Warrants  shall  have an  exercise  price  equal to the  price  paid by the
     Investors at closing,  shall contain standard  anti-dilution,  net exercise
     and registration rights provisions,  and shall have an exercise period of 4
     years.

5.   RETAINERS. No retainer fees shall be charged.

6.   EXPENSES. We do not anticipate incurring any expenses other than legal fees
     for Blue Sky review and  pre-approved  travel  expenses.  Accordingly,  the
     Company agrees to reimburse PSS $5,000 at closing for non-accountable legal
     fees. Travel expenses will be approved and paid or reimbursed as incurred.

7.   FINDER'S  FEES.  We are of the  understanding  that the Company is under no
     obligation to pay any finder's fees to third parties for this  transaction.
     Please advise us in writing if that is not the case.

8.   INDEMNITY.  The Company agrees to indemnify  PSS, its officers,  directors,
     employees, agents and independent contractors,  from any claim, controversy
     or damages, including reasonable attorney's fees, resulting from assertions
     from third parties and arising out of this Agreement,  except to the extent
     attributable to the gross negligence or willful malfeasance of PSS.

9.   GOVERNING LAW. This Agreement shall be interpreted  under, and governed by,
     the laws of the State of California.

10.  ARBITRATION.  Any  disputes  arising  pursuant to this  Agreement  shall be
     settled  by  binding  arbitration  according  to the rules of the  American
     Arbitration Association.

11.  ENTIRE  AGREEMENT.  This  is  the  entire  Agreement  between  the  parties
     pertaining  to the  subject  matter and  supersedes  all prior  agreements,
     representations  and understandings of the parties. No modification of this
     Agreement shall be binding unless agreed to in writing by both parties.

12.  RIGHT OF REFUSAL.  The Company shall retain the sole and absolute  right to
     accept or reject any offers received pursuant to this Agreement.

<PAGE>

Dr.  Maglich,  if the above  states  with  sufficient  detail and  accuracy  the
essential terms of our Agreement, please countersign below and we will begin the
process  immediately.  The Pacific  Summit team and I very much look  forward to
working with you, your management team, and your  professional  advisors on this
transaction.



Sincerely,

/s/
------------------
James L. Watts
President & CEO


Accepted and Agreed to this 27th day of July, 2004:
HiEnergy Technologies, Inc. by


/s/
----------------------------------
Bogdan Maglich, Chairman & CEO