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SETTLEMENT AND RELEASE AGREEMENT



This
  settlement and release agreement (the "Settlement Agreement") is made and entered
  into by and between John King, dba King Ventures ("Releasor") and Turbodyne
  Technologies, Inc., and its subsidiaries (the "Releasees").

RECITALS

| | A. | On or about July 2004 Releasee owed to Releasor $163,690.18
        for past due rents earned by Releasor, which Releasee could not pay at
        the time due to a lack of funds. Releasor attempted to evict Releasee
        for unpaid rent (the Incident), resulting in the payment of delinquent
        rent in the form of restricted stock.        
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | B. | On or about July 2004 Releasor entered into negotiations
        with Releasee to pay the monies owed in the form of legended stock.                                                                                                                                                                                                                         
|
| | C. | Releasors and Releasees, without admission of liability
        or fault in any way by any party, desire to compromise and settle all
        of the disputes that exist, have existed or may exist in the future, which
        concern, relate to or arise out of the Incident, all the injuries and
        damages sustained as a result of the Incident.

WHEREFORE,
  in consideration of the promises and mutual covenants herein, the parties understand
  and agree as follows:

1.1              
  In consideration of the payment set forth above in Recital B, Releasors and
  Releasees hereby completely release and forever discharge each other from any
  and all past, present or future claims, demands, obligations, actions, causes
  of action, rights, damages, costs, losses of services, expenses and compensation
  of any nature whatsoever, whether based in tort, contract or other theory of
  recovery,

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which Releasors or Releasees may have, or which may
  hereafter accrue or otherwise be acquired, on account of, or in any way growing
  out of the Incident, including, without limitation, any and all known or unknown
  claims, any injuries or damages to Releasors or Releasees, or any future injuries
  by Releasors' or Releasees' representatives or heirs in connection with this
  Incident, which have resulted or may result from the alleged acts or omissions
  of Releasors or Releasees.

1.2               This
  release and discharge shall also apply to Releasors'and/or Releasees' past,
  present and future partners, attorneys, agents, servants, representatives, insurers,
  suppliers, distributors, dealers, employees, parents, subsidiaries, affiliates,
  predecessors and successors in interest, and assigns and all other persons,
  firms or corporations with whom any of said persons or entities have been, are
  now, or may hereafter be affiliated.

1.3               This
  release shall be a fully binding and complete settlement between Releasors and
  Releasees and their respective heirs, assigns and successors.

2.0               Releasors
  agree that the covenants, releases and assignments contained herein, and the
  payment pursuant to the Settlement Agreement, are not deemed to be construed
  as an admission of any liability, whether negligence, breach of contract, or
  other fault of any kind whatsoever by Releasees, but are to be construed strictly
  as a compromise and settlement of all disputes between the parties hereto for
  the purpose of avoiding further controversy, litigation and expense.

3.0               The
  parties hereto hereby acknowledge and agree that the release set forth in Paragraph
  1 of the Settlement Agreement is a general release, and they further expressly
  waive and assume the risk of any and all claims for damages which exist as of
  this date, but which Releasors or Releasees do not know or suspect to exist,
  whether through ignorance, oversight, error, negligence or otherwise, and which,
  if known, would materially affect his, her or its decision to enter into the
  Settlement Agreement. Releasors and Releasees further acknowledge that they
  have read California Civil Code Section 1542 and waive all rights thereunder,
  which Section provides: "A general release does not extend to claims which the
  creditor does not know or suspect to exist in his favor at the time of executing
  the release, which if known by him must have materially affected his settlement
  with the debtor"

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4.0               This
  agreement, and the application or interpretation thereof, shall be governed
  exclusively by its terms and by the laws of the State of California.

|King Ventures                |  |       |        
|---------------------------- |  | ----- | -------
|By its authorized signatory: |  |       |        
|                             |  |       |        
|                             |  |       |        
|/s/ John King                |  | Date: | 9/21/04
|John King                    |  |       |        
|President                    |  |       |        
|                             |  |       |        
|Turbodyne Technologies, Inc. |  |       |        
|By its authorized signatory: |  |       |        
|                             |  |       |        
|                             |  |       |        
|                             |  |       |        
|/s/ Andrew Martyn-Smith      |  | Date: | 9/14/04
|Andrew Martyn-Smith          |  |       |        
|CEO/CFO                      |  |       |        

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