EXHIBIT 10.7
                                                               -----------





                             JIM WRIGHT, MARK L. CRAWFORD
                                    AND AARON FINE


                                       - and -



                               AMERICAN ECO CORPORATION







                                ACQUISITION AGREEMENT
                                         AND
                                PLAN OF REORGANIZATION


                                         FOR



                            ENVIRONMENTAL EVOLUTIONS, INC.


     <PAGE> 

                                  INDEX TO SCHEDULES

          Schedule 4.1(b)     -    Jurisdictions where Target Company
          Carries
                                   on Business

          Schedule 4.1(e)     -    List of Pending and Threatened Legal
                                   Proceedings and Claims

          Schedule 4.1(f)     -    List of Registered Shares and Share

                                   Ownership

          Schedule 4.1(m)     -    Articles and By-Laws of Target Company

          Schedule 4.1(m)(1)  -    Directors and Officers of Target Company

          Schedule 4.1(o)     -    Permits and Licenses of Target Company

          Schedule 4.1(p)     -    Target Company Financial Statements

          Schedule 4.1(u)     -    Dividends and Distributions

          Schedule 4.1(x)     -    Secured and Unsecured Indebtedness of
                                   Target Company


          Schedule 4.1(y)(1)  -    Real Property of Target Company

          Schedule 4.1(y)(2)  -    Personal Property of Target Company

          Schedule 4.1(y)(3)  -    Sales and Purchase Commitments of Target
                                   Company

          Schedule 4.1(y)(4)  -    Leases of Target Company

          Schedule 4.1(y)(5)  -    Intellectual Property of Target Company

          Schedule 4.1(y)(6)  -    Bank Accounts of Target Company


          Schedule 4.1(y)(7)  -    Insurance of Target Company

          Schedule 4.1(y)(8)  -    Major Clients of Target Company

          Schedule 4.1(y)(9)  -    Major Suppliers of Target Company

          Schedule 4.1(y)(10) -    Target Company's Employee Particulars

          Schedule 4.1(aa)    -    Contracts of Target Company

          Schedule 8.1(h)     -    Aaron Fine Employment Agreement


          Schedule 8.1(i)     -    Jim Wright Employment Agreement

          Schedule 8.1(j)     -    Mark L. Crawford Employment Agreement


     <PAGE> 


               THIS ACQUISITION AGREEMENT AND PLAN OF REORGANIZATION made
          as of the 1st day of January, 1996. 

          B E T W E E N:


                         JIM WRIGHT, MARK L. CRAWFORD AND AARON FINE
                         individuals resident and domiciled in the State of
                         Texas
                         (collectively the "Shareholders")

                                                          OF THE FIRST PART

                         - and -

                         AMERICAN ECO CORPORATION
                         a corporation amalgamated pursuant to the laws of
                         the Province of Ontario 


                         ("ECO")

                                                         OF THE SECOND PART



          WHEREAS the Shareholders are the owners, in the proportions and
          amounts set forth below, of 100% of the issued and outstanding
          shares in the capital of the Target Company (as hereinafter
          defined) and the Shareholders seek to exchange the Target Company
          Shares (as hereinafter defined) solely for voting stock in ECO
          and ECO seeks to acquire the Target Company Shares from the

          Shareholders, pursuant to this plan of reorganization within the
          meaning of 368 (a) (1) (B) of the U.S. Internal Revenue Code of
          1986, as amended, all on and subject to the terms and conditions
          of this Agreement;

          NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of
          the mutual covenants, agreements and premises herein contained
          and other good and valuable consideration (the receipt and
          sufficiency whereof being hereby acknowledged by each party), the
          parties hereto do hereby covenant and agree as follows: 

          1.   DEFINITIONS AND SCHEDULES

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

          1.1  Definitions.  In this Agreement:
               -----------

               "Accounts Receivable" means all accounts receivable and
               other book debts due or accruing to the Target Company as at
               the Reference Date and the full benefit of all security, if
               any, for such accounts or debts. 

               "Affiliate" has the meaning ascribed thereto in the OBCA. 

               "Agreement", "this Agreement", "hereto" and "herein" means

               this Agreement and all schedules attached hereto, as may be
               amended from time to time. 

               "Associate" has the meaning ascribed thereto in the OBCA. 

               "Best Knowledge" or "known" means actual knowledge or
               awareness of the Party.

               "Business Day" means a day other than a Saturday or a Sunday
               or any other day which is a statutory holiday in the State
               of Texas.


               "Closing" means the consummation of the Transaction as
               herein contemplated. 

               "Closing Date" means March 15, 1996 or such earlier or later
               date as may be agreed to in writing by the Parties.

               "Contract" means any agreement, indenture, contract, bond,
               debenture, security agreement, lease, deed of trust,
               license, option, instrument or other legally binding
               commitment, whether written or oral.

               "Direct Claim" has the meaning ascribed thereto in
               subsection 6.3.


               "ECO" means American ECO Corporation. 

               "ECO Shares" has the meaning ascribed thereto in Section
               2(3).

               "EEI" means Environmental Evolutions, Inc., a Texas
               corporation

               "Encumbrances" means any and all claims, liens, security
               interests, mortgages, pledges, pre-emptive rights, charges,
               options, equity interests, encumbrances, proxies, voting

               agreements, voting trusts, leases, tenancies, easements or
               other interests of any nature or kind whatsoever, howsoever
               created. 

               "Five-Year Gain Recognition Agreement" means the agreement
               to be executed and delivered by the Shareholders and the
               Internal Revenue Service. 

               "Indemnified Party" has the meaning ascribed thereto in
               section 6.3. 

               "Indemnifying Party" has the meaning ascribed thereto in
               section 6.3. 


               "Indemnification Claim" has the meaning ascribed thereto in
               section 6.3. 


               "Intellectual Property" means all patents, copyrights,
               trademarks and trade names, service marks and all software,
               data bases, trade secrets, know-how and other proprietary
               rights as at the Reference Date.

               "Losses" means any and all claims, demands, debts, suits,
               actions, obligations, proceedings, losses, damages,
               liabilities, deficiencies, costs and expenses (including
               without limitation, all reasonable legal and other

               professional fees and disbursements, interest, penalties and
               amounts paid in settlement). 

               "Material Adverse Effect" means a material adverse effect on
               the business, assets, liabilities, condition (financial or
               otherwise), operations or prospects of the Party in question
               or upon such Party's ability to perform its obligations
               under this Agreement or to consummate the Transaction. 

               "OBCA" means the Business Corporations Act, Ontario.

               "Parties" means collectively, the parties to this Agreement.



               "Person" means any individual, partnership, company,
               corporation, unincorporated association, joint venture,
               trust, the Crown or any other agency or instrumentality
               thereof or any other judicial entity or person, government
               or governmental agency, authority or entity howsoever
               designated or constituted. 

               "Reference Date" means January 1, 1996. 

               "Subsidiary" has the meaning ascribed thereto in the OBCA. 


               "Survival Period" has the meaning ascribed thereto in
               section 5.1

               "Target Company" means EEI. 

               "Target Company Contracts" has the meaning ascribed thereto
               in section 4.1(aa). 

               "Target Company Shares" means 100% of the issued and
               outstanding shares of capital stock of the Target Company,
               registered in the names of the Shareholders, as set forth on
               Schedule 4.2(f), hereto. 


               "Target Company Financial Statements" has the meaning
               attributed thereto in section 4.1(p).

               "Taxes" means all income, profits, franchise, royalty,
               withholding, payroll, excise, sales, value added, use,
               occupation and property taxes and any liability, whether
               disputed or not, imposed by the U.S. or any state,
               municipality, country or foreign government or subdivision
               or agency thereof. 

               "Third Party" has the meaning ascribed thereto in section
               6.3. 


               "Third Party Claim" has the meaning ascribed thereto in
               section 6.3. 

               "Time of Closing" means 11:00 a.m. (Houston time) on the
               Closing Date or if the Transaction is not completed at such
               time, then such other time on the Closing Date on which the
               Transaction is completed. 

               "Transaction" means the transfer of the Target Company
               Shares in exchange for the ECO Shares as contemplated by
               this Agreement. 


               "TSE" means The Toronto Stock Exchange. 

          1.2  Disclosure.  Any fact or circumstance or combination of 
               ----------
          facts and/or circumstances disclosed in this Agreement or in any
          schedules hereto shall be deemed to be disclosed for all purposes
          of this Agreement. 

          1.3  Act.  Any reference in this Agreement to any act, by-law, 
               ---
          rule or regulation or to a provision thereof shall be deemed to
          include a reference to any act, by-law, rule or regulation or

          provision enacted in substitution or amendment thereof. 

          1.4  Houston Time.  Except where otherwise expressly provided in
               ------------
          this Agreement any reference to time shall be deemed to be a
          reference to Houston, Texas time. 

          1.5  Gender and Extended Meanings.  In this Agreement words and
               ----------------------------
          personal pronouns relating thereto shall be read and construed as
          the number and gender of the party or parties referred to in each
          case require and the verb shall be construed as agreeing with the
          required word and pronoun.  For greater certainty and without

          limitation, in this Agreement the word "shall" has the same
          meaning as the word "will". 

          1.6  U.S. Dollars and Payment.  All dollar amounts referred to in
               ------------------------
          this Agreement are in U.S. funds, unless otherwise expressly
          specified. 

          1.7  Section Headings.  The division of this Agreement into
               ----------------
          sections is for convenience of reference only and shall not
          effect the interpretation or construction of this Agreement.


          1.8  Business Day.  In the event that the date for the taking of
               ------------
          any action under this Agreement falls on a day which is not a
          Business Day, then such action shall be taken on the next
          following Business Day. 

          2.   AGREEMENT TO EXCHANGE 

          2.1  Transfer.  Subject to the terms and conditions hereof, on
               --------
          the Closing Date at the Time of Closing, the Shareholders shall
          transfer to ECO and ECO shall accept from the Shareholders the

          Target Company Shares and the Assets and the Shareholders shall
          deliver to ECO certificates representing the Target Company
          Shares duly endorsed in blank for transfer together with new
          certificates therefor, which shall be as at the Reference Date. 

          2.2  [Purposely Deleted] 

          2.3  Purchase Price.  The purchase price for the Target Company
               --------------
          Shares shall equal the sum of $2,400,000.00 and shall be
          satisfied by the issuance to the Shareholders of 400,000 fully
          paid and non-assessable common shares in the capital of ECO (the

          "ECO Shares") issued at $6.00 per share.  The ECO Shares shall be
          fully tradeable 41 days after the Closing Date provided that the
          buyer thereof is not a person in the United States and at the
          time the buy order is originated, the buyer is outside the United
          States or the Shareholders and any person acting on their behalf
          reasonably believe that buyer is outside the United States or the
          transaction is executed on or through the facilities of the TSE
          and neither the Shareholders nor any person acting on their
          behalf knows that the transaction has been pre-arranged with a
          buyer in the United States. 

          2.4  Closing.  Closing shall occur at the Time of Closing on the
               -------

          Closing Date at the offices of Moore, Landrey, Garth, Jones,
          Burmeister & Hulett, L.L.P. at 390 Park Street, Suite 500,
          Beaumont, Texas, or at such other place or other time and date as
          the Parties may agree. 

          2.5  Rollover.  At or within sixty (60) days after Closing, the
               --------
          Shareholders shall provide to ECO with an executed copy of the
          Five-Year Gain Recognition Agreement. 

          2.6  Release from Personal Guarantees.  ECO shall use its best
               --------------------------------

          efforts to have the Shareholders released from any and all
          outstanding personal guarantees of Target Company indebtedness
          with all such guarantees being assumed by ECO.  In the event ECO
          cannot obtain such releases from the lenders of any such
          guaranteed indebtedness within forty-five (45) days subsequent to
          the Closing Date, ECO shall pay off or otherwise retire such
          indebtedness. 

          3.   COVENANTS, REPRESENTATIONS AND WARRANTIES OF ECO

          3.1  Covenants, Representations and Warranties.  ECO hereby
               -----------------------------------------
          covenants, represents and warrants to the Shareholders as follows

          and acknowledges and confirms that the Shareholders are relying
          upon such covenants, representations and warranties in connection
          with the Transaction and that unless otherwise indicated herein,
          such covenants, representations and warranties shall be true and
          correct as at the Closing Date: 

               (a)  Organization.  ECO is duly incorporated and validly
                    ------------
                    subsisting under the laws of the Province of Ontario
                    and has the corporate power to own or lease its
                    property and to carry on its business as it is now
                    being conducted and subject to receipt of requisite

                    regulatory approval including approval from the TSE
                    with respect to the Transaction, on the Closing Date
                    ECO will have the corporate power to execute, deliver
                    and perform its obligations under this Agreement.  ECO
                    is duly qualified to do business in those jurisdictions
                    wherein the failure to so qualify could have a Material
                    Adverse Effect on ECO. 

               (b)  Corporate Authority.  Subject to receipt of requisite
                    -------------------
                    regulatory approval including approval from the TSE
                    with respect to the Transaction, on the Closing Date
                    ECO will have taken all requisite corporate action to

                    authorize the valid execution, delivery and performance
                    of this Agreement and the consummation of the
                    Transaction. 

               (c)  Agreement Enforceable.  Subject to receipt of requisite
                    ---------------------
                    regulatory approval including approval from the TSE
                    with respect to the Transaction, this Agreement
                    constitutes a valid and legally binding obligation of
                    ECO enforceable against ECO in accordance with its
                    terms.

               (d)  Securities Laws Matters.  The common shares of ECO are

                    -----------------------
                    listed and posted for trading on the TSE and on NASDAQ. 
                    ECO is in compliance in all material respects with all
                    applicable requirements of the TSE and NASDAQ
                    concerning maintenance of such listings and has
                    received no notification nor has any reasonable basis
                    to believe that such listings may or will be
                    terminated.  ECO is a "reporting issuer" under the
                    Securities Act, Ontario and the Securities Act, Quebec
                    and is not in material default of any of its
                    requirements under any such legislation, regulations or
                    published policies thereunder. 


               (e)  No Violations.  Subject to receipt of requisite
                    -------------
                    regulatory approval including approval from the TSE
                    with respect to the Transaction, the execution and
                    delivery of this Agreement and all other agreements
                    contemplated herein by ECO and the observance and
                    performance of the terms and provisions of this
                    Agreement and any such agreements; (i) does not and
                    will not require ECO to obtain or make any consent,
                    authorization, approval, filing or registration under
                    any law, by-law, rule, regulation, judgment, order,
                    writ, injunction or decree which is binding upon ECO;

                    (ii) does not and will not constitute a violation or
                    breach of the charter documents or by-laws of ECO;
                    (iii) does not and will not constitute a violation or
                    breach of applicable law, any material provision of any
                    Contract to which ECO is a party or by which ECO is
                    bound or any law, by-law, rule, regulation, judgment,
                    order, writ, injunction or decree applicable to ECO;
                    and (iv) does not and will not constitute a material
                    default (nor would with the passage of time or the
                    giving of notice or both or otherwise, constitute a
                    material default) under any Contract, to which ECO is a
                    party or by which ECO is bound.


               (f)  Brokers.  ECO shall be responsible for the payment of
                    -------
                    all brokerage commissions, and finder's fees or other
                    like payment incurred by ECO in connection with this
                    transaction, and ECO will indemnify and save harmless
                    the Shareholders of and from any such claims. 

               (g)  Regulatory Approval.  ECO shall diligently take all
                    -------------------
                    steps necessary or desirable to expeditiously obtain
                    requisite approval from the TSE with respect to the
                    Transaction.  ECO shall not take any action that ECO

                    has reason to believe would result in the disapproval
                    by the TSE of the Transaction. 

               (h)  Reorganization.  The Transaction qualifies as a
                    --------------
                    reorganization within the meaning of 368(a)(1)(B) of
                    the Internal Revenue Code of 1986, as amended, (the
                    "Code") and no gain or loss shall be recognized by the
                    Shareholders upon the exchange of their Target Company
                    Shares for ECO shares provided that Shareholders fully
                    comply with the undertakings of Shareholders described
                    in this Agreement and provided that Shareholders comply
                    with all filing and other requirements imposed upon

                    them by the Code and the regulations.

          4.   COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE
               SHAREHOLDERS

          4.1  Covenants, Representations and Warranties.  The Shareholders
               -----------------------------------------
               hereby jointly and severally covenant, represent and warrant
               to ECO as follows and acknowledge and confirm that ECO is
               relying upon such covenants, representations and warranties
               in connection with the Transaction and that unless otherwise
               indicated herein, such covenants, representations and

               warranties shall be true and correct as at the Closing Date:


               (a)  Legal Capacity.  The Shareholders have the legal
                    --------------
                    capacity and competence to execute, deliver and perform
                    their obligations under this Agreement. 

               (b)  Organization.  The Target Company is duly incorporated
                    ------------
                    and validly subsisting under the laws of the State of
                    Texas and has the corporate power to own or lease its
                    property and to carry on its business as it is now

                    being conducted and has the corporate power to execute,
                    deliver and perform its obligations under this
                    Agreement.  The Target Company is duly qualified to do
                    business in those jurisdictions wherein the failure to
                    so qualify could have a Material Adverse Effect on the
                    Target Company, being those jurisdictions set forth on
                    Schedule 4.1(b). 

               (c)  Corporate Authority.  The Target Company has taken all
                    -------------------
                    requisite corporate action to authorize the valid
                    execution, delivery and performance of this Agreement

                    and the consummation of the Transaction. 

               (d)  No Violations.  The execution and delivery of this
                    -------------
                    Agreement and all other agreements contemplated herein
                    by the Shareholders and the observance and performance
                    of the terms and provisions of this Agreement and any
                    such agreements; (i) does not and will not require the
                    Shareholders or the Target Company to obtain or make
                    any consent, authorization, approval, filing or
                    registration under any law, by-law, rule, regulation,
                    judgment, order, writ, injunction or decree which is
                    binding upon the Shareholders or the Target Company;

                    (ii) does not and will not constitute a violation or
                    breach of the charter documents or by-laws of the
                    Target Company; (iii) does not and will not constitute
                    a violation or breach of applicable law, any material
                    provision of any Contract to which the Shareholders or
                    the Target Company is a party or by which the
                    Shareholders or the Target Company is bound or any law,
                    by-law, rule, regulation, judgment, order, writ,
                    injunction or decree applicable to the Shareholders or
                    the Target Company; (iv) does not and will not
                    constitute a default (nor would with the passage of
                    time or the giving of notice or both or otherwise,

                    constitute a default) under any Contract, to which the
                    Shareholders or the Target Company is a party or by
                    which the Shareholders or the Target Company is bound;
                    and (v) does not and will not result in the creation or
                    imposition of any Encumbrance on the Target Company
                    Shares or any property or assets of the Shareholders or
                    the Target Company. 

               (e)  Issued Shares.  All of the issued and outstanding
                    -------------
                    shares of the Target Company, being the Target Company
                    Shares, have been duly authorized, created and issued
                    as fully paid and non-assessable shares.  There are

                    outstanding no other shares, warrants, rights or
                    securities convertible into shares or any other
                    evidence whatsoever of an interest in the Target
                    Company.

               (f)  Owner of the Target Company Shares.  The Shareholders
                    ----------------------------------
                    are the owners beneficially and of record of the Target
                    Company Shares in the amounts and proportions
                    identified on Schedule 4.1(f), hereto, and have good
                    and marketable title thereto, free and clear of any
                    Encumbrances and/or preemptive rights. The Shareholders

                    have the exclusive right and full power to transfer the
                    Target Company Shares to ECO as herein contemplated,
                    free and clear of any Encumbrances. 

               (g)  Subsidiaries.  The Target Company has no Subsidiaries
                    ------------
                    and owns no shares of any other corporation or entity
                    nor any rights, warrants or other securities
                    convertible into shares of any other corporation or
                    entity.  The Target Company is not bound by or a party
                    to any Contract which contemplates its amalgamation,
                    merger, consolidation or other acquisition with or by
                    any other entity. 


               (h)  Acts of Bankruptcy.  Neither the Shareholders nor the
                    ------------------
                    Target Company is insolvent, has proposed a compromise
                    or arrangement to its or their creditors generally, has
                    taken any proceeding with respect to a compromise or
                    arrangement, has taken any proceeding to have itself
                    declared bankrupt or wound-up, has taken any proceeding
                    to have a receiver appointed of any part of their
                    assets and at present, no encumbrancer or receiver has
                    taken possession of any of their property and no
                    execution or distress is enforceable or levied upon any

                    of its property and no petition for a receiving order
                    in bankruptcy is filed against them.

               (i)  Private Company.  The Target Company does not 
                    ---------------
                    distribute its securities to the public. 

               (j)  Resident.  Each of the Shareholders is a resident of
                    --------
                    the United States.  The Target Company's principal
                    place of business is within the United States. 

               (k)  Actions - Target Company Shares.  There is not pending

                    -------------------------------
                    or, to the Best Knowledge of the Shareholders,
                    threatened or contemplated, any suit, action, legal
                    proceeding, litigation or governmental investigation of
                    any sort which would; (i) in any manner restrain or
                    prevent the Shareholders from effectually and legally
                    transferring the Target Company Shares to ECO in
                    accordance with this Agreement; (ii) cause an
                    Encumbrance to attach to the Target Company Shares;
                    (iii) divest title to the Target Company Shares in any
                    manner whatsoever; or (iv) make ECO liable for damages
                    in connection with the Transaction. 


               (l)  Litigation.  Except as set forth on Schedule 4.1(e),
                    ----------
                    there is not pending, or, to the Best Knowledge of the
                    Shareholders, threatened or contemplated, any suit,
                    action, legal proceeding, litigation or governmental
                    investigation of any sort relating to the Shareholders,
                    the Target Company or the Transaction nor is there any
                    present state of facts or circumstances which can be
                    reasonably anticipated to be a basis for any such suit,
                    action, legal proceeding, litigation or governmental
                    investigation nor is there presently outstanding
                    against the Shareholders or the Target Company any

                    judgment, decree, injunction, rule or order of any
                    court, governmental department, commission, agency,
                    instrumentality or arbitrator. 

               (m)  Minute Books.  The minute book of the Target Company
                    ------------
                    contains accurate and complete copies of its
                    organizational documents together with minutes of all
                    meetings of directors, committees and shareholders of
                    the Target Company.  The articles and the by-laws of
                    the Target Company are attached as Schedule 4.1(m). 
                    There are outstanding no applications or filings which

                    would alter in any way the organizational documents or
                    corporate status of the Target Company.  No resolutions
                    or by-laws have been passed, enacted, consented to or
                    adopted by the directors or shareholders of the Target
                    Company except as are contained in the minute book of
                    the Target Company.  The directors and officers of the
                    Target Company are as set forth on Schedule 4.1(m)(1). 

               (n)  Books of Account.  The books of account and financial
                    ----------------
                    records of the Target Company fairly set out and
                    disclose in all material respects, the current
                    financial position of the Target Company.  All material

                    transactions involving the Target Company have been
                    accurately recorded in such books and records.  All
                    bonuses, commissions and other payments relating to the
                    employees of the Target Company are reflected in the
                    books of the Target Company in a manner consistent with
                    past record keeping practices and none of such payables
                    are in arrears. 

               (o)  Permits and Licenses.  The Target Company has all
                    --------------------
                    necessary permits, certificates, licenses, approvals,
                    consents and other authorizations required to carry on

                    and conduct business and to own, lease or operate its
                    assets at the places and in the manner in which such
                    business is conducted.  Schedule 4.1(o) contains a
                    full, complete and accurate list of such permits,
                    certificates, licenses, approvals, consents and other
                    authorizations. 

               (p)  Financial Statements.  A true copy of the unaudited
                    --------------------
                    financial statements of the Target Company and the
                    statements of operations (the "Target Company Financial
                    Statements") of the Target Company as of December 31,
                    1995, is annexed hereto as Schedule 4.1(p).  The Target

                    Company Financial Statements: 

                    (1)  Have been prepared in accordance with U.S.
                         generally accepted accounting principles applied
                         on a basis consistent with those of the preceding
                         fiscal period.

                    (2)  Present fairly the assets, liabilities and
                         financial position of the Target Company as of
                         December 31, 1995, and the results of operations
                         for the period then ended subject to normal year
                         end adjustments, if applicable.  Other than the

                         liabilities specified in the balance sheet forming
                         part of the Target Company Financial Statements or
                         incurred since the Reference Date in the ordinary
                         course of business (all of which is consistent
                         with past practice) or otherwise noted or
                         disclosed in this Agreement, to the Best Knowledge
                         of the Shareholders, there are no known
                         liabilities or obligations of the Target Company
                         (whether absolute, contingent or otherwise)
                         including without limitation, any Tax liabilities
                         due or to become due or contingent losses for
                         unasserted claims which are capable of assertion. 


                    (3)  Are substantially in accordance with the books and
                         records of the Target Company. 

                    (4)  Contain and reflect all necessary adjustments for
                         a fair presentation of the results of operations
                         and financial position of the Target Company for
                         the period covered thereby. 

                    (5)  Contain and reflect adequate provision or
                         allowance for all reasonably anticipated
                         liabilities, expenses and losses of the Target
                         Company. 


               (q)  Guarantees.  The Target Company does not have any
                    ----------
                    outstanding guarantees or has any outstanding security
                    for any liability, debt or obligation of any Person.

               (r)  Bonds, Debentures.  The Target Company does not have --
                    ---------------
                    any outstanding bonds, debentures or other indebtedness
                    or is under any agreement to create or issue any bonds,
                    debentures or other indebtedness. 

               (s)  No Further Expenditures.  No capital expenditures or

                    -----------------------
                    leasehold improvements have been made by the Target
                    Company since the date of the Target Company Financial
                    Statements, other than in the ordinary course of
                    business. 

               (t)  Related Parties.  Except as disclosed on Schedule 4.1
                    ---------------
                    (aa), since the Reference Date, the Target Company has
                    not made any payment or loan to or borrowed any moneys
                    from and is not otherwise indebted to, any officer,
                    director, employee, shareholder or any other Person not

                    dealing at arm's length with the Target Company. The
                    Target Company is not a party to any Contract with any
                    officer, director, employee, shareholder or any other
                    Person not dealing at arm's length with the Target
                    Company. No officer, director or shareholder of the
                    Target Company and no entity that is an Affiliate or
                    Associate of one or more of such individuals: 

                    (1)  Owns, directly or indirectly, any interest in
                         (except for shares representing less than 2% of
                         the outstanding shares of any class of securities
                         of any publicly traded company) or is an officer,
                         director, employee or consultant of, any Person

                         which is or is engaged in business as a competitor
                         of the Target Company or a lessor, lessee, client
                         or supplier of the Target Company. 

                    (2)  Owns, directly or indirectly, in whole or in part,
                         any property that the Target Company uses in the
                         operation of its business. 

                    (3)  Has any cause of action or any other claims
                         whatsoever against or owes any amount to the
                         Target Company.

               (u)  Dividends or Distributions. Except as disclosed on

                    --------------------------
                    Schedule 4.1(u), no dividends or other distributions on
                    any of the shares in the capital of the Target Company
                    have been authorized, declared or paid since the date
                    of the Target Company Financial Statements and there
                    has not been any direct or indirect redemption,
                    purchase or acquisition of any such shares. 

               (v)  No Changes.  Since the Reference Date, the Target
                    ----------
                    Company has carried on business and conducted its
                    operations and affairs only in the ordinary and normal
                    course consistent with past practice and there has not

                    been: 

                    (1)  Any material adverse change in the condition
                         (financial or otherwise), assets, liabilities,
                         operations, earnings, business or prospects of the
                         Target Company. 

                    (2)  Any damage, destruction or loss (whether or not
                         covered by insurance) affecting the property or
                         assets of the Target Company or any failure to
                         regularly maintain and repair such property and
                         assets in the ordinary course of business. 


                    (3)  Any payment, discharge or satisfaction of any
                         Encumbrance, liability or obligation of the Target
                         Company (whether absolute, accrued, contingent or
                         otherwise and whether due or to become due)
                         greater than $1,000.00 other than payment of
                         accounts payable and Tax liabilities incurred in
                         the ordinary course of business consistent with
                         past practice. 

                    (4)  Any issuance or sale by the Target Company or any
                         Contract entered into by the Target Company for
                         the issuance or sale by the Target Company of any

                         shares in the capital of or securities convertible
                         into or exercisable into shares in the capital of
                         the Target Company. 

                    (5)  Any labor disturbances have a Material Adverse
                         Affect on the Target Company. 

                    (6)  Any license, sale, assignment, transfer,
                         disposition, pledge, mortgage or granting of a
                         security interest or other Encumbrance on or over
                         any property or assets of the Target Company other
                         than in the ordinary course of business. 


                    (7)  Any write-off as uncollectible of any Accounts
                         Receivable or any portion there of the Target
                         Company in amounts exceeding the allowance set out
                         in the Target Company Financial Statement. 

                    (8)  Any cancellation of any other debts or claims or
                         any amendment, termination or waiver of any other
                         rights of value to the Target Company in amounts
                         exceeding $1,000.00 in each instance or $5,000.00
                         in the aggregate. 

                    (9)  Any general increase in the compensation of
                         employees of the Target Company (including without

                         limitation, any increase pursuant to any employee
                         plan or commitment) or any increase in any such
                         compensation or bonus payable to any officer,
                         employee, consultant or agent thereof (having an
                         annual salary or remuneration in excess of
                         $30,000.00), the execution of any employment
                         contract with any officer or employee (having an
                         annual salary or remuneration in excess of
                         $30,000.00) or the making of any loan to or
                         engagement in any transaction with any employee,
                         officer or director of the Target Company. 


                    (10) Any material change in the accounting or tax
                         practices followed by the Target Company. 

                    (11) Any material change adopted in the depreciation or
                         amortization policies or rates or any material
                         change in the credit terms offered to customers of
                         or by suppliers to the Target Company. 

                    (12) Any acquisition, transfer, assignment, sale or
                         other disposition of any of the assets shown in
                         the Target Company Financial Statements other than
                         in the ordinary course of business. 


                    (13) Any institution or settlement of any litigation,
                         action or proceeding before any court or
                         governmental body by or against the Target
                         Company.

                    (14) The creation of any debts and/or liabilities
                         whatsoever (whether accrued, absolute, contingent
                         or otherwise) than in the ordinary course of
                         business.

               (w)  Taxes.  Except as reserved for in the Target Company
                    -----

                    Financial Statements:

                    (1)  All returns, including reports of every kind with
                         respect to Taxes, which are due to have been filed
                         by the Target Company in accordance with
                         applicable law, have been duly filed by the dates
                         prescribed by law and are complete and accurate. 

                    (2)  All Taxes, deposits or other payments for which
                         the Target Company may have any liability arising
                         prior to Closing have been paid in full or accrued
                         as liabilities for Taxes on the books of the
                         Target Company. 


                    (3)  All installments for Taxes which the Target
                         Company may be required to make have been made on
                         a timely basis. 

                    (4)  The amount so paid on or before the Reference Date
                         together with any amounts accrued as liabilities
                         for Taxes (whether accrued as currently payable or
                         deferred taxes) on the books and in the Target
                         Company Financial Statements will be adequate to
                         satisfy all liabilities for Taxes of the Target
                         Company in any jurisdiction in respect of the

                         periods covered. 

                    (5)  There are not now any extensions of time in effect
                         with respect to the dates on which any returns,
                         including elections, or reports of Taxes were or
                         are due to be filed by the Target Company and
                         there are no outstanding requests therefor. 

                    (6)  All assessments or reassessments of Taxes asserted
                         as a result of any examination of any return or
                         report of Taxes have been paid by the Target
                         Company, have been accrued on the books of the
                         Target Company and in the Target Company Financial

                         Statements or finally settled and no issue has
                         been raised in any such examination which, by
                         application of the same or similar principles,
                         reasonably could be expected to result in a
                         proposed deficiency for any other period not so
                         examined. 

                    (7)  No payments are or will be required to be made by
                         the Target Company pursuant to any tax indemnity,
                         allocation or sharing agreement and all such
                         agreements will be terminated with respect to the
                         Target Company as of the Reference Date.


                    (8)  No claims, proposals, assessments or reassessments
                         for any Taxes are being asserted or, to the Best
                         Knowledge of the Shareholders, proposed or
                         threatened and, to the Best Knowledge of the
                         Shareholders, no audit or investigation of any
                         return or report of Taxes is currently under way,
                         pending or threatened. 

                    (9)  There are no outstanding waivers or agreements by
                         the Target Company for the extension of time for
                         the assessment or reassessment of any Taxes or
                         deficiency thereof nor are there any requests for

                         rulings, outstanding subpoenas or requests for
                         information, notice of proposed reassessment of
                         any property owned or leased by the Target Company
                         or any other matter pending between the Target
                         Company and any taxing authority. 

                    (10) There are no liens for Taxes upon the Target
                         Company shares or upon any property or assets of
                         the Target Company except liens for current Taxes
                         not yet due.

                    (11) To the Best Knowledge of the Shareholders there

                         are no facts which exist or have existed which
                         would constitute grounds for the assessment of any
                         Taxes of the Target Company with respect to the
                         periods which have not been audited by the
                         Internal Revenue Service or other taxing
                         authorities. 

                    (12) The Target Company has withheld from each payment
                         made to its officers, directors and employees and
                         former officers, directors and employees, the
                         amount of all Taxes and other deductions required
                         to be withheld therefrom and has paid the same to
                         the proper tax and other receiving officers within

                         the time required under applicable legislation. 

                    (13) Adequate provision, including provision in the
                         deferred tax account, has been made for all
                         deferred and accrued Tax liabilities with respect
                         to operations of the Target Company for the period
                         ending on the Reference Date. 

                    (14) The Target Company and the Shareholders have made
                         provision for the filing with the Internal Revenue
                         Service of all necessary statements and consents
                         required to revoke the status of the Target

                         Company as an S Corporation, effective for the
                         Target Company's fiscal year beginning January 1,
                         1996. 

                    (x)  Assets.  The Target Company has good and
                         ------
                         marketable title to all of its assets as reflected
                         on the Target Company Financial Statements, free
                         and clear of all Encumbrances save and except for
                         those assets sold, assigned, transferred or
                         disposed of in the ordinary course of business and
                         save and except for the encumbrances identified in
                         Schedule 4.1(x), hereto. 


                    (y)  Schedules.  The Schedules hereto contain full,
                         ---------
                         complete and accurate lists and descriptions of
                         the following as at the Reference Date: 

                    (1)  Schedule 4(y)(1): All real property owned of
                         record or beneficially of the Target Company.

                    (2)  Schedule 4.1(y)(2): All items of tangible personal
                         property (other than raw material, purchased
                         parts, work in process, finished goods and other

                         items of inventory), if any, not reflected on any
                         other Schedule hereto having a book value of
                         $200.00 or more and owned of record or
                         beneficially by the Target Company, including
                         without limitation, automobiles, trucks and other
                         vehicles. 

                    (3)  Schedule 4.1(y)(3): All purchase commitments of
                         the Target Company where the amount remaining
                         unpaid is in excess of $500.00 and all sales
                         commitments where the total value of the
                         commitment which is presently unpaid exceeds
                         $1,000.00 of the Target Company. 


                    (4)  Schedule 4.1(y)(4): Each lease (including all
                         amendments thereto) where the total amount
                         remaining to be paid thereunder exceeds $500.00
                         under which the Target Company is a lessee of any
                         personal property and each real property lease.
                         All rentals due under all such leases have been
                         paid up to and including the Reference Date and
                         there are no defaults by the Target Company under
                         the terms of such leases and no event has occurred
                         which, upon the passage of time or the giving of
                         notice or both would result in an event of default

                         by the Target Company or would prevent the Target
                         Company from exercising and obtaining the benefits
                         of any rights or options contained therein.  The
                         Target Company has all right, title and interest
                         of the lessee under the terms of each such lease
                         free and clear of any Encumbrances and all such
                         leases are valid and in full force and effect. 
                         The Transaction does not constitute a default by
                         the Shareholders or the Target Company under any
                         such leases and the consent of the lessors under
                         such leases is not required with respect to this
                         Transaction.


                    (5)  Schedule 4.1(y)(5): All Intellectual Property that
                         is directly or indirectly owned, licensed, used,
                         required for use or controlled in whole or in part
                         by the Target Company and the Shareholders and all
                         material licenses and other agreements allowing
                         the Target Company and the Shareholders to use the
                         Intellectual Property of other Persons.  None of
                         the Intellectual Property of the Target Company
                         and the Shareholders infringes upon the
                         Intellectual Property of any other Person and to
                         the Best Knowledge of the Shareholders, no
                         activity of any other Person infringes upon any of

                         the Intellectual Property of the Target Company or
                         the Shareholders to the extent that any such
                         infringement in either case could have a Material
                         Adverse Effect on the Target Company or the
                         Shareholders.  To the Best Knowledge of the
                         Shareholders, the Target Company has been and is
                         now conducting business in a manner which has not
                         been and is not now in violation of any
                         Intellectual Property of any other Person and does
                         not require a material license to operate such
                         business as currently conducted except as
                         disclosed on Schedule 4.1(o).  The Intellectual
                         Property of the Target Company is sufficient for

                         the conduct of business of the Target Company as
                         currently conducted. 

                    (6)  Schedule 4.1(y)(6): The name and address of each
                         bank, trust company or other financial institution
                         in which the Target Company has an account and the
                         names of all Persons authorized to draw thereon as
                         well as all powers of attorney granted by the
                         Target Company.

                    (7)  Schedule 4.1(y)(7): All insurance policies now in
                         full force and effect (specifying the insurer, the

                         amount of coverage, type of insurance, the amount
                         of deductible if any, the policy number, expiry
                         date and any pending claims thereunder) maintained
                         by the Target Company on its assets including
                         without limitation, business interruption,
                         personal and product liability coverage and by the
                         Target Company on the lives of its directors and
                         officers, together with true copies thereof.  The
                         proceeds of such policies are fully payable to the
                         Target Company.  All premiums in connection with
                         such policies are fully paid.  Such insurance is
                         in amounts deemed by the Shareholders to be
                         sufficient for all policy periods prior to the

                         Reference Date with respect to the assets,
                         properties, business, operations, products and
                         services owned or conducted by the Target Company. 
                         There are no claims, actions, suits or proceedings
                         arising out of or based upon any of such insurance
                         policies and to the Best Knowledge of the
                         Shareholders, no basis for any such claim, action,
                         suit or proceeding exists.  The Target Company is
                         not in default with respect to any provisions
                         contained in any such insurance policy which would
                         adversely affect its rights to make any claim
                         under any such insurance policy. 


                    (8)  Schedule 4.1(y)(8): All major clients of the
                         Target Company (being those clients of the Target
                         Company accounting for more than 5% of revenues
                         for the financial year ended on December 31, 1995. 
                         There has been no termination or cancellation of
                         the business relationship of the Target Company
                         with any major client or group of major clients.

                    (9)  Schedule 4.1(y)(9): All suppliers or vendors of
                         products or services to the Target Company
                         aggregating more than $10,000.00 during the period
                         ending on the Reference Date, the address of each

                         such supplier or vendor and the amount sold to the
                         Target Company during such period. 

                    (10) Schedule 4.1(y)(10): 

                         (a)  All written contracts or arrangements for the
                              employment of any officer, employee, agent or
                              consultant of the Target Company.

                         (b)  A complete list of all permanent and
                              full-time employees of the Target Company,
                              their salaries and wage rates, their

                              positions and their length of service and
                              particulars of any Contracts, arrangements or
                              understandings, written or oral, with them. 

                         (c)  All bonus, deferred compensation, severance
                              or termination pay, insurance, medical,
                              dental, drug, profit sharing, pension,
                              retirement, stock option, stock purchase,
                              hospitalization insurance or other material
                              plans or arrangements providing employee
                              benefits to any current or former director,
                              officer, employee or consultant of the Target
                              Company and all relevant vacation policies. 


               (aa) Certain Contracts and Commitments.  Schedule 4.1 (aa)
                    ---------------------------------
                    sets forth a list and description of all contracts,
                    leases and licenses of the Target Company (the "Target
                    Company Contracts") not included on any other Schedule. 
                    The enforceability of the Target Company Contracts will
                    not be affected in any manner by the execution and
                    delivery of this Agreement or the consummation of the
                    Transaction.  The Target Company is not in default and
                    there does not exist any event that, with notice or
                    lapse of time or both, would constitute an event of

                    default by the Target Company under any of the Target
                    Company Contracts. None of the Shareholders has
                    knowledge of any breach or default by any other party
                    to the Target Company Contracts.  A true and complete
                    copy of each such Target Contract has been delivered to
                    ECO or will be delivered to ECO prior to the Closing
                    Date.

               (ab) No Other Contracts.  For greater certainty and without
                    ------------------
                    limitation, except as set forth in Schedule 4.1 (aa) or
                    otherwise herein, the Target Company is not a party to
                    or bound by any Contract which in any way has or could

                    have a Material Adverse Effect on the Target Company. 
                    The Contracts set forth in the Schedules hereto are not
                    subject to renegotiation or cancellation resulting from
                    the Transaction. Except as described in the Schedules,
                    the Target Company is not a party to or bound by: 

                    (1)  Any Contract for the purchase of materials,
                         supplies, equipment or services which involves the
                         payment of $1,000.00 or more. 

                    (2)  Any Contract for the sale, license or provision of
                         any assets or services which involve the receipt

                         of $1,000.00 or more. 

                    (3)  Any trust indenture, mortgage, promissory note,
                         loan agreement, guarantee or other Contract for
                         the borrowing of money or a leasing transaction of
                         the type required to be capitalized in accordance
                         with generally accepted accounting principles. 

                    (4)  Any Contract for charitable contributions in
                         excess of $500.00 in the aggregate. 

                    (5)  Any Contract relating to a distributorship, sales
                         representative or sales agency agreement. 


                    (6)  Any Contract which involves the sharing of
                         profits, a joint venture, partnership, joint
                         development or bidding arrangement or any material
                         advertising contracts. 

                    (7)  Any Contract not made in the ordinary course of
                         business. 

                    (8)  Any Contract restricting in any manner the conduct
                         of the Target Company or the ownership or use of
                         the assets thereof.


                    (9)  Any material warranties relating to products
                         distributed or services provided by the Target
                         Company. 

                    (10) Any Contract involving the payment or receipt of
                         $5,000.00 or more in any 12 month period. 

                    (11) Any Contract required to be disclosed on a
                         Schedule to this Agreement that is not so
                         disclosed. 

               (ac) Default of Contracts.  The Target Company has performed

                    --------------------
                    all of the obligations required to be performed by it
                    to the extent performance is due and is entitled to all
                    benefits under and is not in default or alleged to be
                    in default in respect of, any Contract to which it is a
                    party or by which it is bound.  No event, condition or
                    occurrence exists that, after notice or lapse of time
                    or both, would constitute a default under any of such
                    Contracts.  The Target Company has the capacity,
                    including the necessary personnel, equipment and
                    supplies, to materially perform all its obligations
                    under all such Contracts. 


               (ad) Compliance with Laws.  The Target Company has conducted
                    --------------------
                    and is now conducting business in compliance with all
                    statutes, regulations, by-laws, orders, covenants,
                    restrictions or plans of all federal, state or
                    municipal authorities, agencies or boards applicable to
                    such business.  The Target Company is not in default
                    under any such statutes, regulations, by-laws, orders,
                    covenants, restrictions or plans applicable to it. 
                    Neither the Target Company nor any of its directors,
                    officers, agents, employees or other Persons acting on
                    behalf of the Target Company have, directly or

                    indirectly, used any corporate funds of the Target
                    Company for unlawful contributions, gifts,
                    entertainment or other unlawful expenses relating to
                    political activity, made any unlawful payments on
                    behalf of the Target Company to foreign or domestic
                    government officials or employees or to foreign or
                    domestic political parties or campaigns from corporate
                    funds, knowingly made any false or fictitious entry on
                    the books or records of the Target Company or made any
                    bribe, rebate, payoff, influence payment, kickback or
                    other unlawful payment on behalf of the Target Company.


               (ae) Leased Premises.  The occupation and use to which the
                    ---------------
                    leased premises of the Target Company have been put by
                    the Target Company is not in breach of any applicable
                    statute, by-law, regulation, covenant or restriction
                    applicable to the leased premises.  The zoning by-laws
                    applicable to the leased premises of the Target Company
                    permit the operation of business and the intended use
                    to be made of the leased premises by the Target
                    Company.  There are no outstanding work orders against
                    the leased premises of the Target Company or any part
                    thereof nor are there any matters under discussion
                    between the Target Company and any governmental or

                    municipal authority which may give rise to work orders.

               (af) Environmental Matters.  To the Best Knowledge of the
                    ---------------------
                    Shareholders, the buildings and premises at which the
                    Target Company carries on business does not contain any
                    material quantities of noxious substances including
                    without limitation, urea formaldehyde foam insulation,
                    aluminum wiring, asbestos, materials containing
                    asbestos, polychlorinated byphenyls or substances
                    containing polychlorinated byphenyls or radon at levels
                    deemed unacceptable by any health, labor or

                    environmental authority or any federal, state or
                    municipal government. The operations of the Target
                    Company in all material respects complies with all
                    applicable environmental statutes, regulations and
                    decrees, whether federal, state or municipal.  The
                    Target Company has not received any notices to the
                    effect that the business carried on by the Target
                    Company is not in compliance with the requirements of
                    applicable environmental statutes, regulations or
                    decrees or is subject to any remedial control or action
                    or any investigation or evaluation as to whether any
                    remedial action is required to respond to a release or
                    threatened release of any contaminant into the

                    environment or into any facility or structure which
                    forms part of or is adjacent to the leased premises at
                    which the business is carried on. 

               (ag) Employee Plans and Arrangements.  All of the contracts,
                    -------------------------------
                    plans and arrangements referred to in Schedule
                    4.1(y)(10) are in good standing and the Target Company
                    has made all payments required to be made by it in
                    connection therewith.  All employee plans requiring
                    funding on the part of the Target Company are fully
                    funded.  The Target Company does not have any employees

                    receiving or claiming long term disability benefits or
                    workers' compensation benefits.  No notice has been
                    received by the Target Company of any complaints filed
                    by any employees claiming that the Target Company has
                    violated any applicable employee or human rights or
                    similar legislation in any other jurisdiction in which
                    the Target Company carries on business or of any
                    complaints or proceedings of any kind involving the
                    Target Company or any employees of the Target Company
                    before any labor relations board.  There are no
                    outstanding orders or charges against the Target
                    Company under any applicable heath and safety
                    legislation in the jurisdictions in which the Target

                    Company carries on business.  All levies, assessments
                    and penalties made against the Target Company pursuant
                    to any applicable workers' compensation legislation in
                    any jurisdictions in which any of the Target Company
                    carries on business have been paid by the Target
                    Company and the Target Company has been reassessed
                    under any such legislation during the past 3 years. 
                    The Target Company has not made any agreements with any
                    labor union or employee association or made commitments
                    to or conducted negotiations with any labor union or
                    employee association with respect to any future
                    agreements and none of the Shareholders is aware of any

                    current attempts to organize or establish any labor
                    union or employee association relating to the Target
                    Company.  The Target Company has not entered into any
                    agreement or made any arrangements with any employees
                    and consultants which would have the effect of
                    depriving the Target Company of the continued services
                    of any such employees and consultants following the
                    Closing.

               (ah) No Brokers.  All negotiations relating to this
                    ---------
                    Agreement and the Transaction have been carried on by
                    the Shareholders directly with ECO without the

                    intervention of any other Person on behalf of the
                    Shareholders in such manner as to give rise to any
                    valid claim against ECO for a brokerage commission,
                    finder's fee or other like payment and the Shareholders
                    will indemnify and save harmless ECO of and from any
                    such claim. 

               (ai) Omissions and Misrepresentations.  None of the 
                    --------------------------------
                    foregoing covenants, representations and warranties
                    knowingly contains any untrue statement of material
                    fact or knowingly omits to state any material fact

                    necessary to make any such covenant, warranty or
                    representation not misleading to a prospective
                    purchaser of the Target Company Shares and the Assets
                    seeking full information as to the Target Company.

          5.   SURVIVAL OF COVENANTS, REPRESENTATIONS AND WARRANTIES
               -----------------------------------------------------

          5.1  Survival.  No investigations made by or on behalf of any
               --------
          Party at any time shall have the effect of waiving, diminishing
          the scope of or otherwise affecting any covenant, representation
          or warranty made by any Party.  No waiver by any Party of any

          condition, in whole or in part, shall operate as a waiver of any
          other condition.  The covenants, representations and warranties
          contained in Article 3 and 4 respectively or in any certificate
          or other document delivered in connection with the Closing shall
          survive the making of this Agreement and the Closing for a period
          of 2 years and only 2 years, except the representations and
          warranties set forth in Paragraphs (h) Reorganization of Section
          3.1 and Section 4.1(w) Taxes and Section 4.1(af) Environmental
          Matters, which representations and warranties shall survive the
          Closing for a period of 5 years and only 5 years (the applicable
          period of survival being herein referred to as the "Survival
          Period"); provided, however, that if a claim for a breach of any

          such covenant, representation or warranty is brought prior to the
          expiration of the applicable Survival Period such covenant,
          representation or warranty shall, for the purposes of such claim,
          survive the applicable Survival Period until such claim is
          finally resolved and all obligations with respect thereto have
          been fully satisfied. 

          6.   INDEMNITY
               ---------

          6.1  Indemnity by ECO.  ECO agrees to indemnify and save harmless
               ----------------
          the Shareholders from all Losses actually incurred by the

          Shareholders as a result of any breach by ECO or any inaccuracy
          of any covenant, representation or warranty contained in this
          Agreement. 

          6.2  Indemnity by the Shareholders.  Each of the Shareholders
               -----------------------------
          agree to jointly and severally indemnify and save harmless ECO
          from all Losses actually incurred by ECO as a result of: 

               (a)  Any breach by the Shareholders or any inaccuracy of any
                    covenant, representation or warranty contained in this
                    Agreement. 


               (b)  All debts and liabilities whatsoever (whether accrued,
                    absolute, contingent or otherwise) of the Target
                    Company as at the Reference Date which are not
                    disclosed on, provided for or included in the balance
                    sheets forming part of the Target Company Financial
                    Statements or which did not arise in the ordinary
                    course of business since the date of the Target Company
                    Financial Statements up to the Time of Closing. 

               (c)  Any assessment or reassessment of Taxes, interest
                    and/or penalties for any period up to the Reference
                    Date for which no adequate reserve has been provided

                    and disclosed in the Target Company Financial
                    Statements; 

          provided, however, that the liability of each of the Shareholders
          under this indemnity shall be limited to the value at Closing of
          the pro rata portion of the purchase price received by each
          Shareholder. 

          6.3  Notice of Claims
               ----------------

               (a)  In the event that a Party (the "Indemnified Party")

                    shall become aware of any Loss in respect of which
                    another Party (the "Indemnifying Party") agreed to
                    indemnify the Indemnified Party pursuant to this
                    Agreement (the "Indemnification Claim"), the
                    Indemnified Party shall promptly give written notice
                    thereof to the Indemnifying Party.  Such notice shall
                    specify whether the Indemnification Claim arises as a
                    result of a claim by a Person against the Indemnified
                    Party (a "Third Party Claim") or whether the Loss does
                    not so arise (a "Direct Claim") and shall also specify
                    with reasonable particularity (to the extent that the
                    information is available) the factual basis for the
                    Indemnification Claim and the amount of the Loss if

                    known.

               (b)  If through the fault of the Indemnified Party the
                    Indemnifying Party does not receive notice of any
                    Indemnification Claim in time to contest effectively
                    the determination of any liability susceptible of being
                    contested, the Indemnifying Party shall be entitled to
                    set off against the amount claimed by the Indemnified
                    Party the amount of any Losses incurred by the
                    Indemnifying Party resulting from the Indemnified
                    Party's failure to give such notice on a timely basis. 


          6.4  Investigation of Claims.  With respect to any Direct Claim,
               -----------------------
          following receipt of notice from the Indemnified Party of the
          Indemnification Claim, the Indemnifying Party shall have 60 days
          to make such investigation of the Indemnification Claim as is
          considered necessary or desirable.  For the purpose of such
          investigation, the Indemnified Party shall make available to the
          Indemnifying Party the information relied upon by the Indemnified
          Party to substantiate the Indemnification Claim, together with
          all such other information as the Indemnifying Party may
          reasonably request.  If all Parties agree at or prior to the
          expiration of such 60 day period (or any mutually agreed upon
          extension thereof) to the validity and amount of such

          Indemnification Claim, the Indemnifying Party shall immediately
          pay to the Indemnified Party the full agreed upon amount of the
          Indemnification Claim, failing which the matter shall be
          determined by a court of competent jurisdiction. 

          6.5  Supplemental Rights.  The rights and benefits provided in
               -------------------
          this Article are supplemental to and are without prejudice to any
          other rights, actions or causes of action which may arise
          pursuant to any other section of this Agreement or pursuant to
          applicable law. 


          7.   PRE-CLOSING COVENANTS 

          7.1  Operations Before Closing.  For greater certainty and
               -------------------------
          without limitation, without the prior written consent of ECO
          during the period commencing on the Reference Date and
          terminating at the close of business on the Closing Date, the
          Shareholders; (i) shall not make nor shall the Shareholders
          permit to be made any material change in the way the Target
          Company is being operated; and (ii) shall comply with all laws in
          connection with the business of the Target Company. 

          8.   CONDITIONS PRECEDENT TO THE SHAREHOLDERS' OBLIGATIONS AT

               --------------------------------------------------------
               CLOSING
               -------

          8.1  Conditions Precedent.  All obligations of the Shareholders
               --------------------
          to sell the Target Company Shares and the Assets at Closing under
          this Agreement are subject to the fulfillment (or waiver in
          writing by the Shareholders) prior to or at the Closing of each
          of the following conditions:

               (a)  Covenants, Representations and Warranties.  The

                    -----------------------------------------
                    covenants, representations and warranties made by ECO
                    in or under this Agreement shall be true in all
                    material respects on and as of the Closing Date and the
                    Shareholders shall have received from ECO a certificate
                    signed as of the Closing Date to such effect. 

               (b)  Actions, Etc.  All actions, proceedings, instruments
                    ------------
                    and documents required to carry out the Transaction
                    including without limitation the issue of the ECO
                    Shares as contemplated in this Agreement and all other
                    related legal matters shall have been approved by the

                    Shareholders and the Shareholders shall have been
                    furnished with such certified copies of actions and
                    proceedings and other such instruments and documents as
                    the Shareholders shall have requested. 

               (c)  Approvals.  ECO shall have received all requisite
                    ---------
                    regulatory approvals including approvals of the TSE and
                    board of director approvals in connection with the
                    Transaction. 

               (d)  Compliance with Covenants.  ECO shall have complied ---

                    ----------------------
                    with all covenants and agreements herein agreed to be
                    performed or caused to be performed by ECO. 

               (e)  Approvals and Consents.  At or before Closing there ---
                    -------------------
                    shall have been obtained from all appropriate federal,
                    state, provincial, municipal or other governmental or
                    administrative bodies all such approvals and consents,
                    if any, in form and on terms satisfactory to the
                    Shareholders as may be required in order to permit the
                    issue of the ECO Shares as provided in this Agreement. 


               (f)  Corporate Authorizations.  ECO shall have delivered to
                    ------------------------
                    the Shareholders evidence satisfactory to the
                    Shareholders that all necessary corporate
                    authorizations by ECO authorizing and approving the
                    Transaction have been obtained. The Closing ECO Shares
                    shall have been duly authorized, created and validly
                    issued as fully paid and non-assessable shares free and
                    clear of all Encumbrances and shall be listed and
                    posted for trading on the TSE and NASDAQ, subject only
                    to routine filings and subject to the matters contained
                    in this Agreement. 


               (g)  No Orders.  No order of any court or administrative
                    ---------
                    agency shall be in effect which restrains or prohibits
                    the Transaction and no suit, action, inquiry,
                    investigation or proceeding in which it will be or it
                    is sought to restrain, prohibit or change the terms of
                    or obtain damages or other relief in connection with
                    the Transaction and which in the reasonable judgment of
                    the Shareholders makes it inadvisable to proceed with
                    the consummation of the Transaction shall have been
                    made, instituted or threatened by any Person. 


               (h)  Employment Agreement - Jim Wright.  EEI shall have
                    ---------------------------------
                    entered into an employment agreement with Jim Wright in
                    the form set out in Schedule 8.1(h).

               (i)  Employment Agreement - Mark Crawford.  EEI shall have
                    ------------------------------------
                    entered into an employment with Mark Crawford in the
                    form set out in Schedule 8.1(i).

               (j)  Employment Agreement - Aaron Fine.  EEI shall have
                    ---------------------------------

                    entered into an employment agreement with Aaron Fine in
                    the form set out in Schedule 8.1(j). 

               In case any of the foregoing conditions cannot be fulfilled
          at or before the Time of Closing to the reasonable satisfaction
          of the Shareholders, the Shareholders may rescind this Agreement
          by notice to ECO and in such event all of the Parties shall be
          released from all obligations hereunder.  Provided however that
          any such conditions may be waived in whole or in part by the
          Shareholders without prejudice to the Shareholders' rights of
          rescission in the event of the non-fulfillment of any other
          condition or conditions, any such waiver to be binding on the
          Shareholders only if the same is in writing. 


          9.   CONDITIONS PRECEDENT TO ECO'S OBLIGATIONS AT CLOSING
               ----------------------------------------------------

          9.1  Conditions Precedent.  All obligations of ECO to purchase
               --------------------
          the Target Company Shares this Agreement are subject to the
          fulfillment (or waiver in writing by ECO) prior to or at the
          Closing of each of the following conditions: 

               (a)  Actions, Etc.  All actions, proceedings, instruments
                    ------------

                    and documents required to carry out the Transaction
                    including without limitation, the transfer of the
                    Target Company Shares and all other related legal
                    matters shall have been approved by ECO and ECO shall
                    have been furnished with such certified copies of
                    actions and proceedings and other such instruments and
                    documents as ECO shall have requested.

               (b)  Covenants, Representations and Warranties.  The
                    -----------------------------------------
                    covenants, representations and warranties made by the
                    Shareholders in or under this Agreement shall be true
                    in all material respects on and as of the Closing Date

                    and ECO shall have received from the Shareholders a
                    certificate signed as of the Closing Date and to such
                    effect. 

               (c)  Approvals.  ECO shall have received all requisite
                    ---------
                    regulatory approval including without limitation
                    approvals of TSE and board of director approvals in
                    connection with the Transaction. 

               (d)  Resignations.  All of the directors and officers of the
                    ------------
                    Target Company shall have resigned as directors and

                    officers of the Target Company in favor of nominees of
                    ECO and the resigning directors and officers of the
                    Target Company shall have delivered releases to the
                    Target Company and ECO in form and substance.

               (e)  Compliance with Covenants.  The Shareholders shall have
                    -------------------------
                    complied with all covenants and agreements herein
                    agreed to be performed or caused to be performed by the
                    Shareholders. 

               (f)  Approvals and Consents.  At or before Closing there ---
                    -------------------

                    shall have been obtained from all appropriate federal,
                    state, municipal or other governmental or
                    administrative bodies all such approvals and consents,
                    if any, in form and on terms reasonably satisfactory to
                    ECO as may be required in order to transfer the Target
                    Company Shares at Closing as herein provided. 

               (g)  Permits and Licenses. ECO shall have been furnished 
                    --------------------
                    with evidence that the Target Company holds all valid
                    permits and licenses as may be requisite for carrying
                    on business.


               (h)  Corporate Authorizations. The Shareholders shall have
                    ------------------------
                    delivered to ECO evidence satisfactory to ECO that all
                    necessary corporate authorizations by the Shareholders
                    and the Target Company authorizing and approving the
                    Transaction have been obtained.

               (i)  No Orders. No order of any court or administrative 
                    ---------
                    agency shall be in effect which restrains or prohibits
                    the Transaction and no suit, action, inquiry,
                    investigation or proceeding in which it will be or it

                    is sought to restrain, prohibit or change the terms of
                    or obtain damages or other relief in connection with
                    the Transaction and which in the judgment of ECO makes
                    it inadvisable to proceed with the consummation of the
                    Transaction shall have been made, instituted or
                    threatened by any Person. 

               (j)  Undertaking.  The Shareholders shall have executed and
                    -----------
                    delivered to ECO an undertaking concerning those
                    matters to which the Shareholders covenanted in the
                    Five Year Gain Recognition Agreement in the form set

                    out in Schedule 9.1(k).

               (k)  Employment Agreement - Jim Wright.  EEI shall have
                    ---------------------------------
                    entered into a 36-month employment agreement with Jim
                    Wright in the form set out in Schedule 8.1(h).

               (l)  Employment Agreement - Mark L. Crawford.  EEI shall
                    ---------------------------------------
                    have entered into a 36-month employment with Mark L.
                    Crawford in the form set out in Schedule 8.1(i).

               (m)  Employment Agreement - Aaron Fine.  EEI shall have

                    ---------------------------------
                    entered into a 36-month employment contract with Aaron
                    Fine in the form set out in Schedule 8.1(j).

               In case any of the foregoing conditions cannot be fulfilled
          at or before the Time of Closing to the satisfaction of ECO, ECO
          may rescind this Agreement by notice to the Shareholders and in
          such event the Parties shall be released from all obligations
          hereunder. Provided however that any such conditions may be
          waived in whole or in part by ECO without prejudice to ECO's
          rights of rescission in the event of the non-fulfillment of any
          other condition or conditions, any such waiver to be binding on

          ECO only if the same is in writing.

          10.  MISCELLANEOUS
               --------------

          10.1 Tender.  Any tender of documents or money hereunder may be
               ------
          made upon the Parties or upon their respective solicitors as set
          forth herein. 

          10.2 Notice.  All notices, requests, demands or other
               ------
          communications by the Parties required or permitted to be given

          by one Party to another shall be given in writing by personal
          delivery, telecopy or by registered or certified mail, postage
          prepaid, addressed, telecopied or delivered to such other Party
          as follows: 


               (a)  if to the Shareholders, to:

                    (1)  Jim Wright
                         11618 Caliche Creek
                         Corpus Christi, TX 78410


                    (2)  Mark L. Crawford
                         P. O. Box 23005
                         Corpus Christi, TX 78403

                    (3)  Aaron Fine
                         P. O. Box 1376
                         Orange Grove, TX 78372

               (b)  if to ECO, to:

                         1325 South Creek
                         Suite 100
                         Houston, Texas

                         77084

                         Attention: Michael E. McGinnis, President

                         Telefax No.: 713-647-0080
                         Telephone No.: 713-647-0505

          or at such other address or telecopier number as may be given by
          any of them to the others in writing from time to time and such
          notices, requests, demands or other communications shall be
          deemed to have been received when delivered, if personally
          delivered, on the date telecopied (with receipt confirmed) if

          telecopied and received at or prior to 5:00 p.m. local time and,
          if not, on the next Business Day, and if mailed, on the date
          received as certified. 

          10.3 Further Assurances. The Parties shall sign such other 
               ------------------
          papers, cause such meetings to be held, resolutions passed and
          by-laws enacted and exercise their vote and influence, do and
          perform and cause to be done and performed such further and other
          acts and things as may be necessary or desirable in order to give
          full effect to this Agreement and every part hereof. 

          10.4 Laws.  This Agreement shall be governed by the laws of Texas

               ----
          and the Parties hereby irrevocably attorn to the Courts of Harris
          County, Texas. 

          10.5 Expenses.  All out-of-pocket expenses (including legal and
               --------
          accounting expenses) incurred in connection with the Transaction
          shall be borne by the respective Parties. 

          10.6 Time of the Essence.  Time shall be of the essence of this
               -------------------
          Agreement and of every part hereof and no extension nor variation
          of this Agreement shall operate as a waiver of this provision. 


          10.7 Entire Agreement.  This Agreement constitutes the entire
               ----------------
          agreement between the Parties with respect to all of the matters
          herein. This Agreement supersedes any and all agreements,
          understandings and representations made between the Parties prior
          to the date hereof including without limitation, that certain
          letter of intent dated February 1, 1996.  This Agreement shall
          not be amended except by a memorandum in writing signed by all of
          the Parties and any amendment hereof shall be null and void and
          shall not be binding upon any Party which has not given its
          consent as aforesaid. 


          10.8 Assignment.  No Party may assign this Agreement or any part
               ----------
          hereof without the prior written consent of the other Parties
          which consent may be unreasonably withheld.  Subject to the
          foregoing, this Agreement shall enure to the benefit of and be
          binding upon the Parties and their respective successors and
          permitted assigns, but no other Person. 

          10.9 Invalidity.  In the event that any of the covenants,
               ----------
          representations and warranties or any portion of them contained
          in this Agreement are unenforceable or are declared invalid for

          any reason whatsoever, such unenforceability or invalidity shall
          not affect the enforceability or validity of the remaining terms
          or portions thereof contained in this Agreement and such
          unenforceable or invalid covenant, representation and warranty or
          covenant or portion thereof shall be severable from the remainder
          of this Agreement.

          10.10     Counterpart.  This Agreement may be executed in several
                    -----------
          counterparts, each of which so executed shall be deemed to be an
          original and such counterparts when taken together shall
          constitute one and the same original agreement which shall be
          binding on the Parties hereto.


          10.11     Schedules.  The parties acknowledge that as of the
                    ---------
          Closing Date, all of the Schedules and exhibits referred to in
          this Agreement have been approved by the parties and are attached
          to this Agreement.


     <PAGE> 

                    IN WITNESS WHEREOF the Parties have duly executed this
          Agreement, in multiple counterparts, as of the date and year

          first above written.



                                        /s/ Jim Wright
                              _____________________________________
                                             JIM WRIGHT



                                             /s/ Mark L. Crawford  
                                        __________________________________
                                             MARK L. CRAWFORD




                                        /s/ Aaron Fine 
                                   _____________________________________
                                             AARON FINE



                                        AMERICAN ECO CORPORATION

                                        BY: /s/ Michael E. McGinnis 

                                   _____________________________________
                                        ITS: President                     

     <PAGE> 



                       FIRST AMENDMENT TO ACQUISITION AGREEMENT
                      __________________________________________

          This First Amendment to Acquisition Agreement (the "First
          Amendment") is made and entered into by and between American Eco
          Corporation, an Ontario corporation ("Eco") and Jim Wright, Mark

          L. Crawford and Aaron Fine, residents of the State of Texas
          (collectively, the "Shareholders").

          WHEREAS, Eco and the Shareholders have heretofore entered into a
          certain Acquisition Agreement and Plan of Reorganization (the
          "Agreement"), as of the Reference Date, whereby Eco exchanged
          400,000 shares of its common stock to the Shareholders for 100%
          of the issued and outstanding stock of Environmental Evolutions,
          Inc., a Texas corporation (the "Target Company"); and 

          WHEREAS, the parties desire to amend and supplement the
          Acquisition Agreement, in the manner hereinafter set forth. 


          NOW, THEREFORE, in consideration of the covenants, agreements and
          premises herein contained and other good and valuable
          consideration, the receipt and sufficiency of which is hereby
          acknowledged by each party, the parties hereto do hereby agree
          that the Agreement shall be amended and modified in the following
          respects: 

          1.    Section 3.1 of the Agreement shall be amended and
          supplemented by the addition of the following sub-paragraphs: 

               (i)  ECO CAPITALIZATION.  Immediately after the closing of
               the acquisition of the Target Company, Eco will have only

               one class of stock outstanding, all such shares of
               outstanding stock will have the same voting rights and the
               total number of issued and outstanding shares of stock of
               Eco, after giving effect to the transaction described in
               this Agreement, will be at least 9,300,000 shares. 

               (j)  ACTIVE TRADE OR BUSINESS.  Eco or one of its affiliates
               (as defined in Section 1504(a) of the Internal Revenue code
               of 1986, as amended, without regard to Section 1504(b)(3))
               has been engaged in the active conduct of a trade or
               business, within the meaning of Section 1.367(a)-2T(b)(2)
               and (3) of the Income Tax Regulations (the "Regulations")

               promulgated by the U.S.  Treasury Department, that is
               substantial in comparison to the trade or business of the
               Target Company, for the entire 36-month period immediately
               preceding the date of the closing of the acquisition of the
               Target Company. 

               (k)  COMPLIANCE WITH REGULATIONS.  Eco shall cause the
               Target Company to comply with the reporting requirements
               contained in Regulations Section 1.367(a)-3T(c)(4). 

          2.   All reference in the Agreement and the Schedules to a Five
          Year Gain Recognition Agreement are hereby deleted, and said
          Agreement shall be read and construed as if said reference were

          not contained therein. 

          3.   Unless otherwise defined herein, all capitalized terms used
          herein shall have the same meanings ascribed to them in the
          Agreement. 

          4.   Except as specifically amended, modified and supplemented by
          this First Amendment, all of the provisions of the Agreement are
          incorporated herein by reference and are hereby reaffirmed as
          being fully binding and in full force and effect with respect to
          each of the parties hereto.
           

          IN EVIDENCE WHEREOF, the parties have caused this First Amendment
          to be duly executed on the date set forth opposite each party's
          signature hereto, but effective as of the Reference Date. 

                                                  AMERICAN ECO CORPORATION



          DATED: March 15, 1996              BY: /s/ Michael E. McGinnis    
                                                 ________________________
                                                       MICHAEL E. MCGINNIS
                                                  ITS: PRESIDENT AND CHIEF
                                                       EXECUTIVE OFFICER


                                                  SHAREHOLDERS:



          DATED: March 15, 1996                   /s/ Jim Wright            
                                                  ________________________
                                                  JIM WRIGHT



          DATED: March 15, 1996                   /s/ Aaron Fine        

                                                  ________________________
                                                  AARON FINE


          DATED: March 15, 1996                   /s/ Mark L. Crawford      
                                                  _________________________
                                                  MARK L. CRAWFORD