<PAGE>


                                                                    EXHIBIT 10.4
                                   ADDENDUM TO

                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT ADDENDUM (the "Agreement") is made and
entered into this 7th day of June, 2000, by and between Polymer Solutions, Inc.,
a Nevada corporation (the "Company"), and Edward Laughlin Flanagan, a resident
of the State of California, as an individual ("Employee") to amend the
EMPLOYMENT AGREEMENT entered into on the 6th day of February, 1998 with Addendum
of 14th day of June, 1999.

WITNESSETH:

         WHEREAS. THE Company and the Employee entered into an Agreement on the
6th day of February, 1998, and,

         WHEREAS, the Company desires to continue to retain the services of
Employee, and Employee desires to continue to be employed by the Company for the
term of this Agreement.

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements set forth herein, the Company and Employee, intending
to be legally bound, hereby agree as follows:

         Employment/Position. The Company employs Employee as President and
              Chief Executive Officer of Polymer Solutions, Inc. and Employee
              accepts such employment and agrees to perform services for the
              Company, subject always to such resolutions or instructions as are
              established from time to time by the Board of Directors of the
              Company or its Chairman (or official delegate thereof), for the
              period and upon the other terms and conditions set forth in this
              Agreement for the period and upon the other terms and conditions
              set forth in this Agreement. The Company and Chairman of the Board
              of Directors of the Company also agree to have the Employee
              maintained as a Director of the Company during the term of this
              agreement.

      1. Term. The term of Employee's employment hereunder shall be for a period
of three (3) years, commencing on the original date of the Agreement. The term
of Employee's employment hereunder is subject to earlier termination as
hereafter specified, and will automatically renew on the first and each
subsequent anniversary of the original agreement until terminated as provided
herein.

      2. Duties.

              a)Job Description. During the term of this Agreement, Employee
         agrees to perform such employment duties as the Company's Board of
         Directors (the "Board") or Chairman (or official delegate thereof)
         shall reasonably assign to him from time to time.

              b)No Conflicting Duties. During the term hereof, Employee shall
         not serve as an officer, director, employee, consultant or advisor to
         any other business, which would constitute a conflict of interest. The
         Company consents to Employee providing services to other entities,
         provided such services do not interfere with Employee's duties and
         responsibilities to the Company. Employee shall notify the Company of
         any such non-conflicting duties and the Company shall have the right to
         consent that there is not a conflict of interest. The Company shall not
         unreasonably withhold consent. Employee hereby confirms that he is
         under no contractual commitments inconsistent with his obligations set
         forth in this Agreement, and that during the term of this

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         Agreement, he will not render or perform services, or enter into any
         contract to do so, for any other corporation, firm, entity or person
         which are inconsistent with the provisions of this Agreement.

      3. Compensation.

              a)Salary. As compensation for all services to be rendered by
         Employee under this Agreement, the Company shall pay to Employee a base
         monthly salary of Twelve Thousand Five Hundred Dollars ($12,500.00)
         (the "Base Salary"), all such compensation shall be paid in accordance
         with the Company's normal payroll procedures and policies. The Company
         shall also provide an annual performance bonus of 40% of the Base
         Salary, based upon the attainment of mutually agreed upon benchmarks
         established annually. For fiscal year ending March 31, 2001, the
         following performance measurement shall be used as a basis for the
         bonus calculation:

<TABLE>
<CAPTION>
                                          HIGH      MID-POINT       LOW
                                        -------     ---------       ---
<S>                                     <C>         <C>           <C>
PSI WITHOUT ADDITIONAL ACQUISITION:
Before-tax Profit/<Loss>                950,000      825,000      700,000
Bonus %                                    30.0%        15.0%         0.0%
</TABLE>

         An additional ten (10) percent will be allocated given that an
         acquisition bringing at least $2,000,000 sales to the Company is
         completed or substantially completed by May 1, 2001. The bonus may also
         be raised above the 30 percent in the event that profits exceed the 30
         percent bonus target set out above. The bonus will be calculated on a
         pro-rata basis of actual performance of Before-tax Profit to above on a
         sliding scale.

              b)Performance-Based Incentive Plan. Company agrees to provide
         Employee with an Economic Value Added (EVA) stock option incentive
         compensation plan, similar to the Stern Stewart and Associates EVA
         Incentive Plan and agreed upon by Employee.

              c)Participation in Benefit Plans. Employee shall be included to
         the extent eligible thereunder in any and all plans of the Company
         providing general benefits for the Company's employees, including but
         not limited to Group Life Insurance, Hospitalization, Disability,
         Medical, Dental, Pension, Profit Sharing, and Savings Plans. Employee's
         participation in any such plan or program shall be subject to the
         provisions, rules and regulations applicable thereto. Notwithstanding
         the foregoing, Employee shall be eligible for four (4) weeks of
         vacation.

              d)Stock Options or Warrants to Purchase Shares. The Board of
         Directors will grant to Employee certain qualified stock options,
         incentive stock options, nonqualified stock options or Warrants to
         Purchase Shares. The number of such shares shall be 250,000. The
         exercise price of this initial allocation shall be Cdn$1.00 per share.
         Subsequent allocations shall be based on the "Ten (10) Day Volume
         Weighted Average Price as of the date of the allocation. It is
         understood that these will most likely be warrants recognized and
         exercisable under US securities laws. They will be allocated
         immediately but may not be exercisable until the Company de-lists from
         the Vancouver Stock Exchange (VSE), which is the intent of the Company.
         These options and/or warrants shall vest as follows:

                    i)       33.33%     February 1, 1999

                   ii)       33.33%     February 1, 2000

                  iii)       33.33%     February 1, 2001

              e)All options and/or warrants will immediately vest upon
         termination of this employment agreement pursuant to Section 9(e). Upon
         the sale of a controlling interest of the Company or any

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         change of control of the Company, one hundred percent (100%) of all
         options and/or warrants will vest immediately.

              f)Expenses. In accordance with the Company's policies established
         from time to time, the Company will pay or reimburse Employee for all
         reasonable and necessary out-of-pocket expenses.

      4. Compensation Upon the Termination of Employee's Employment by the
Company.

              a)In the event that Employee is terminated pursuant to Section
         9(c) (cause), or 9(d) (resignation), then Employee shall be entitled to
         receive Employee's then current monthly Base Salary through the date he
         is terminated, but no additional compensation.

              b)In the event that Employee is terminated pursuant to Section
         9(a) (disability), then Employee shall be entitled to receive
         Employee's then current monthly Base Salary for six (6) months after
         date of termination for disability.

              c)In the event Employee's employment is terminated pursuant to
         Section 9(b) (death), and in lieu of Company paid life insurance,
         Employee's beneficiary or a beneficiary designated by Employee in
         writing to the Company, or in the absence of such beneficiary,
         Employee's estate, shall be entitled to receive Employee's then current
         Base Salary for twelve (12) months after the date of death, but no
         additional compensation.

              d)In the event Employee is terminated by the Company pursuant to
         Section 9(e) (without cause), the Company shall pay to Employee his
         then current monthly Base Salary through the date his employment is
         terminated, and severance pay following the date of termination, plus
         the same employee benefits Employee received immediately prior to the
         termination, for the remaining period of this contract.

              e)All payments required to be made by the Company to Employee
         pursuant to this Section 4 shall be paid in the manner and at the times
         specified in Section 3(a) hereof.

      5. Confidential Information. Except as permitted or directed by the
Company's Board, Employee shall not during the term of his employment under this
Agreement or at any time thereafter divulge, furnish, disclose or make
accessible (other than in the ordinary course of the business of the Company) to
anyone for use in any way any confidential or secret knowledge or information of
the Company which Employee has acquired or become acquainted with or will
acquire or become acquainted with prior to the termination of the period of his
employment by the Company (including employment by, or association with, the
Company prior to the date of this Agreement), whether developed by himself or by
others, concerning any trade secrets, confidential or secret designs, processes,
formulae, software or computer programs, plans, devices or material (whether or
not patented or patentable, copyrighted or copyrightable) directly or indirectly
useful in any aspect of the business of the Company, any confidential customer
or supplier lists of the Company, any confidential or secret development or
research work of the Company, or any other confidential, secret or nonpublic
aspects of the business of the Company. Employee acknowledges that the
above-described knowledge or information constitutes a unique and valuable asset
of the Company acquired at great time and expense by the Company, and that any
disclosure or other use of such knowledge or information other than for the sole
benefit of the Company would be wrongful and would cause irreparable harm to the
Company. Both during and after the term of this Agreement, Employee will refrain
from any acts or omissions that would reduce the value of the use of such
knowledge or information to the Company. The foregoing obligations of
confidentiality, however, shall not apply to any knowledge or information which
is now published or which subsequently becomes generally publicly known, other
than as a direct or indirect result of the breach of this Agreement by Employee,
or which Employee possessed

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prior to his consulting or employment relationship with the Company, or which
was received by Employee from a source other than the Company without
contractual restriction on disclosure or use.

      6. Patent and Related Matters.

              a)Disclosure and Assignment. Employee will promptly disclose in
         writing to the Company complete information concerning each and every
         invention, improvement, device, design, apparatus, practice, process,
         software or computer program, method or product, whether or not
         patentable or copyrightable, made, developed, perfected, devised,
         conceived or first reduced to practice by Employee, either solely or in
         collaboration with others, during Employee's employment under this
         Agreement, or for the period in which a covenant not to compete is in
         effect hereunder as to Employee, whether or not during regular working
         hours, relating either directly or indirectly to the business, products
         or practices of the Company (hereinafter referred to as the
         "Inventions"). Employee, to the extent that he has the legal right to
         do so, hereby acknowledges that any and all of the Inventions are the
         property of the Company and hereby assigns and agrees to assign to the
         property of the Company any and all of Employee's right, title and
         interest in and to any and all of the Inventions without further
         payment.

              b)Future Inventions. As to any future Inventions made by Employee
         which relate to the business, products or practices of the Company and
         which are first conceived or reduced to practice during the term of
         this Agreement, or for the period in which a covenant not to compete is
         in effect hereunder as to Employee, but which are claimed for any
         reason to belong to an entity or person other than the Company,
         Employee will promptly disclose the same in writing to the Company and
         shall not disclose the same to others if the Company, within twenty
         (20) days thereafter, shall claim ownership of such Inventions under
         the terms of the Agreement.

           c) Limitations of Sections 6(a) and 6(b). The provisions of Sections
6(a) and 6(b) shall not apply to any Invention meeting the following conditions
(an "Excluded Invention"):

         i) such Invention was developed entirely on Employee's own time; and

                           ii) such Invention was made without the use of any
                  Company equipment, supplies, facilities or trade secret
                  information; and

         iii) such Invention does not relate (i) directly to the business of the
Company, or (ii) to the Company's actual or demonstrably anticipated research or
development; and

         iv) such Invention does not result from any work performed by Employee
for the Company; and

         v) Employee informs the Company in writing within one month after
commencing work on any Invention that is to be an Excluded Invention and again
informs the Company in writing that such Invention has been developed within one
(1) month of the date when development of such Invention is complete.

              d)Assistance of Employee. Upon the request of the Company and
         without further compensation therefore, but at no expense to Employee,
         and whether during the term of this Agreement or thereafter, Employee
         will do all lawful acts, including, but not limited to, the execution
         of papers and lawful oaths and the giving of testimony, that in the
         opinion of the Company, its successors and assigns, may be necessary or
         desirable in obtaining, sustaining, reissuing, extending and enforcing
         United States and foreign Letters Patents, including, but not limited
         to, design patents, on any and all of the Inventions, and for
         perfecting, affirming and

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         recording the Company's complete ownership and title thereto, and to
         cooperate otherwise in all proceedings and matters relating thereto.

              e)Records. Employee will keep complete, accurate and authentic
         accounts, notes, data and records of all of the Inventions in the
         manner and form requested by the Company. Such accounts, notes, data
         and records shall be the property of the Company, and, upon its
         request, Employee will promptly surrender the same to it or, if not
         previously surrendered upon its request or otherwise, Employee will
         surrender the same, and all copies thereof, to the Company upon the
         conclusion of his employment.

              f)Obligations, Restrictions and Limitations. Employee understands
         that the Company may enter into agreements or arrangements with
         agencies of the United States Government, and that the Company may be
         subject to laws and regulations which impose obligations, restrictions
         and limitations on it with respect to inventions and patents which may
         be acquired by it or which may be conceived or developed by employees,
         consultants or other agents rendering services to it. Employee agrees
         that he shall be bound by all such obligations, restrictions and
         limitations applicable to any said invention conceived or developed by
         him during the term of this Agreement and shall take any and all
         further action which may be required to discharge such obligations and
         to comply with such restrictions and limitations.

      7. Ventures. If, during the term of this Agreement, Employee is engaged in
or associated with the planning or implementing of any project, program or
venture involving the Company and a third party or parties, all rights in the
project, program or venture shall belong to the Company and shall constitute a
corporate opportunity belonging exclusively to the Company. Except as approved
by the Company's Board of Directors, Employee shall not be entitled to any
interest in such project, program or venture or to any commission, finder's fee
or other compensation in connection therewith other than the salary to be paid
to Employee as provided in this Agreement, unless agreed to in writing by the
Board of Directors beforehand.

      8. Non-Competition; Solicitation of Customers and Solicitation of
Employees.

                    a) Non-Competition.

              i) Employee agrees that, during the period of his employment
         hereunder and for a period of six (6) months following the termination
         of his employment with the Company for any reason, he shall not
         directly or indirectly, engage in competition with the Company within
         any State in the United States in which the Company does business (the
         "Territory") in any manner or capacity (e.g., as a management
         consultant, principal, partner, officer, director, stockholder or
         management employee) in any phase of the Company's business as then
         being conducted.

              ii) Ownership by Employee, as a passive investment, of less than 2
         1/2% of the outstanding shares of capital stock of any corporation
         listed on a national securities exchange or publicly traded in the
         over-the-counter market shall not constitute a breach of this Section
         8.

              iii) Employee further agrees that, during the term of this
         Agreement, he will not, directly or indirectly, assist or encourage any
         other person in carrying out, directly or indirectly, any activity that
         would be prohibited by the above provisions of this Section 9 if such
         activity were carried out by Employee, either directly or indirectly,
         and in particular Employee agrees that he will not, directly or
         indirectly, induce any employee of the Company to carry out, directly
         or indirectly, any such activity.

                    b)Agreement Not to Solicit Customers. Employee agrees that
         during his employment by the Company hereunder and for the period in
         which a covenant not to compete is in effect

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         hereunder as to Employee, he will not, either directly or indirectly,
         on his own behalf or in the service or on behalf of others, solicit,
         divert or appropriate, or attempt to solicit, divert or appropriate, to
         any competing business (i) any person or entity whose account with the
         Company was sold or serviced by or under the supervision of Employee
         during the year preceding the termination of such employment, or (ii)
         any person or entity whose account with the Company has been directly
         solicited at least twice by the Company within the eighteen (18) month
         period prior to the date of termination of employment.

              c)Agreement Not to Solicit Employees. Employee agrees that during
         his employment by the Company hereunder and for the three (3) year
         period following the termination of such employment for any reason, he
         will not, either directly or indirectly, on his own behalf or in the
         service or on the behalf of others solicit, divert or hire away, or
         attempt to solicit, divert or hire away any person then employed by the
         Company or then serving as a sales representative of the Company.

              d)Reasonableness. The restrictions contained in this Agreement are
         considered by Employee to be fair and reasonable and necessary for the
         protection of the legitimate business interests of the Company, and it
         is Employee's intent that such restrictions be enforceable and enforced
         to their fullest extent. Employee acknowledges that Employee can earn a
         livelihood without violating any of the undertakings contained in this
         Agreement.

              e)Notice to Future Employers. For the period of six (6) months
         following the termination of Employee's employment with the Company,
         Employee shall provide a copy of this Agreement to any future or
         prospective employer of Employee and agrees that the Company also may
         do so.

              f)Voluntary Reduction of Scope. The Company shall have the right,
         but not the obligation, to reduce the geographical scope, duration or
         coverage of the foregoing covenants and provisions, in its sole
         discretion, either before or after any determination of their
         enforceability, and such covenants and provisions, as so reduced, shall
         be binding on the parties.

              g)Reformation. In the event that any provision in this Section 8
         is held to be overbroad as written, such provision shall be deemed
         amended to narrow its application to the extent necessary to make the
         provision enforceable to the fullest extent allowable. The parties
         hereby agree that such amendment shall be accomplished as follows:

         i)  In the case of duration, the length of the covenant or provision
shall be reduced in increments of one (1) month each until it is of the greatest
duration as is enforceable under applicable law.

         ii) In the case of geographic scope, the geographic scope of the
covenant or provision shall be reduced until it is of the greatest geographic
scope as may be enforceable under applicable law, which reduction shall be
effected by eliminating in the following order, one by one, the individual
States within the Territory, beginning with the State in which the Company had
the lowest gross sales within the prior twelve (12) months according to the
Company's records, and continuing in the inverse order ranked by the Company's
gross sales over the prior twelve (12) months until the geographic scope of the
covenant or provision is determined to be enforceable, and then, if necessary,
by eliminating in the following order, one by one, the counties in the State of
California, beginning with the county furthest from Butte County and continuing
in the inverse order of proximity to Butte County until such scope is
enforceable.

      9. Termination Prior to Expiration of the Term.

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              a)Disability. Employee's employment shall terminate upon the
         Employee becoming totally or permanently disabled for a period of six
         (6) months. For purposes of this Agreement, the term "totally or
         permanently disabled" or "total or permanent disability" means
         Employee's inability on account of sickness or accident, whether or not
         job-related, to engage in regularly or to perform adequately his
         assigned duties under this Agreement. A reasonable determination by the
         Board of Directors of the existence of a disability shall be conclusive
         for all purposes hereunder. In making such determination of disability,
         the Board of Directors may utilize such advice and consultation as the
         Board of Directors deems appropriate, but there is no requirement of
         procedure or formality associated with the making of a determination of
         disability.

              b) Death of Employee. Employee's employment shall terminate
         immediately upon the death of Employee.

              c)Termination for Cause. The Company may terminate Employee's
         employment at any time for "Cause" (as hereinafter defined) immediately
         upon written notice to Employee. Such written notice shall set forth
         with reasonable specificity the Company's basis for such termination.
         As used herein, the term "Cause" shall mean (i) conviction of any
         felonious crime, (ii) non compliance, in a reasonable manner and in a
         reasonable time period, with reasonable directives of the Board or the
         Chairman communicated to Employee, or (iii) serious violation of
         Company rules, policies, or procedures, or breach of this Agreement or
         any other agreement with the Company; provided that "Cause" shall exist
         with respect to a breach under either subsection (ii) or (iii) hereof
         only if Employee fails to cure such breach within ten (10) calendar
         days after written notice from the Company of such breach.

              d) Resignation. Employee's employment shall be terminated on the
         date that is two (2) months following the written submission of
         Employee's resignation to the Board.

              e)Termination Without Cause. The Company may terminate Employee's
         employment without cause upon written notice to Employee. Termination
         "without cause" shall mean termination of employment on any basis other
         than termination of Employee's employment hereunder pursuant to
         Sections 9(a), 9(b), 9(c) or 9(d). The restructuring or reduction of
         Employee's duties and responsibilities shall be deemed, at Employee's
         discretion, as termination without cause.

              f)Surrender of Records and Property. Upon termination of his
         employment with the Company, Employee shall deliver promptly to the
         Company all computer equipment, computer software, keys, records,
         manuals, books, blank forms, documents, letters, memoranda, notes,
         notebooks, reports, data, tables, calculations or copies thereof, which
         are the property of the Company and which relate in any way to the
         business, products, practices or techniques of the Company, and all
         other property, trade secrets and confidential information of the
         Company, including, but not limited to, all documents which in whole or
         in part contain any trade secrets or confidential information of the
         Company, which in any of these cases are in his possession or under his
         control.

      g) Assignment. This Agreement shall not be assignable, in whole or in
part, by either party without the written consent of the other party, except
that the Company may, without the consent of Employee, assign its rights and
obligations under this Agreement to any corporation, firm or other business
entity (i) with or into which the Company may merge or consolidate, or (ii) to
which the Company may sell or transfer all or substantially all of its assets or
of which 50% or more of the equity investment and of the voting control is
owned, directly or indirectly, by, or is under common ownership with, the
Company. Upon such assignment by the Company, the Company shall obtain the
assignees'

                                     Page 81

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written agreement enforceable by Employee to assume and perform, from and after
the date of such assignment, the terms, conditions, and provisions imposed by
this Agreement upon the Company. After any such assignment by the Company and
such written agreement by the Assignee, the Company shall be discharged from all
further liability hereunder and such assignee shall thereafter be deemed to be
the Company for the purposes of all provisions of this Agreement including this
Section 9.

      h) Injunctive Relief. Employee agrees that it would be difficult to
compensate the Company fully for damages for any violation of the provisions of
this Agreement, including without limitation the provisions of Sections 5, 6, 8
and 9. Accordingly, Employee specifically agrees that the Company shall be
entitled to temporary and permanent injunctive relief to enforce the provisions
of this Agreement. This provision with respect to injunctive relief shall not,
however, diminish the right of the Company to claim and recover damages in
addition to injunctive relief.

      10. Miscellaneous.

              a) Governing Law. This Agreement is made under and shall be
         governed by and construed in accordance with the laws of the State of
         California.

              b)Prior Agreements. This Agreement contains the entire agreement
         of the parties relating to the subject matter hereof and supersedes all
         prior agreements and understanding with respect to such subject matter,
         and the parties hereto have made no agreements, representations or
         warranties relating to the subject matter of this Agreement which are
         not set forth herein.

              c) Withholding Taxes. The Company may withhold from any benefits
         payable under this Agreement all federal, state, city or other taxes as
         shall be required pursuant to any law or governmental regulation or
         ruling.

              d) Amendments. No amendment or modification of this Agreement
         shall be deemed effective unless made in writing signed by the parties
         hereto.

              e)No Waiver. No term or condition of this Agreement shall be
         deemed to have been waived nor shall there be any estoppel to enforce
         any provisions of this Agreement, except by a statement in writing
         signed by the party against whom enforcement of the waiver or estoppel
         is sought. Any written waiver shall not be deemed a continuing waiver
         unless specifically stated, shall operate only as to the specific term
         or condition waived and shall not constitute a waiver of such term or
         condition for the future or as to any act other than that specifically
         waived.

              f)Severability. If, after application of any provision of this
         Agreement specifying how reformation shall be accomplished, including
         Section 10(g), any provision of this Agreement or portion thereof is
         determined by a court of competent jurisdiction to be wholly or
         partially unenforceable for any reason, such provision or portion
         thereof shall be considered separate from the remainder of this
         Agreement, which shall remain in full force and effect.

              g) Survival. Sections 4, 5, 6, 7, and 8 shall survive termination
         of this Agreement.

         IN WITNESS WHEREOF, the parties have executed and sealed this Agreement
as of the day and year set forth above.

Signed: /s/ E. Laughlin Flanagan           Signed: /s/ Gordon Ellis
            ---------------------                      -------------------------
Date:   June 14, 2000                      Date:   July 31, 2000
        Edward Laughlin Flanagan                         Gordon Ellis, Chairman
                                                         Polymer Solutions, Inc.

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