EXHIBIT 10.28.2

                               SECURITY AGREEMENT

         THIS SECURITY AGREEMENT ("Agreement"), dated as of July 13, 2001, is by
and among  Probex  Corp.,  a Delaware  corporation  ("Debtor"),  Falcon  Capital
Management,  LLC,  a  Texas  limited  liability  company  ("Collateral  Agent"),
Nicholas  W.  Hollingshad,  an  individual  resident  of the State of Texas,  H.
Reiffert  Hedgcoxe,  an  individual  resident  of the  State of  Texas,  Annette
Brewster,  an individual  resident of the State of Texas,  Mark C.  Stuckey,  an
individual resident of the State of Texas,  Kenneth R. Schroeder,  an individual
resident of the State of Texas, Timothy J. Prince, an individual resident of the
State of Texas, Shawn B. Doherty,  an individual resident of the State of Texas,
Lance  R.  Cooper,  an  individual  resident  of the  State  of  Texas,  General
Conference  Corporation  of  Seventh-day  Adventists,  a  District  of  Columbia
corporation,  Bischoff  Family  Partners,  Jerry H.  and  Margie  Sue  Jennings,
individual residents of the State of Maryland, John R. Minesinger, an individual
resident of the State of Maryland,  Charles M. Rampacek,  an individual resident
of the State of Texas,  David J. McNiel, an individual  resident of the State of
Texas,  the  Marcus  Blum and Gary L. Blum  Trust,  and E. Bruce  McClendon,  an
individual resident of the State of Texas (collectively, "Secured Parties").

                                    RECITALS:

         A. In  connection  with the  execution  of this  Agreement,  Debtor has
executed  those  certain  Secured  Promissory  Notes in the  original  aggregate
principal  amount of  $1,830,000.00,  in favor of Secured  Parties (as  amended,
restated or modified, the "Notes").

         B. The  execution  and  delivery of this  Agreement  is required by the
terms of the Notes and is a condition to their effectiveness.

         NOW  THEREFORE,  in  consideration  of the  premises and other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, the parties hereto agree as follows:

                          Security Interest and Pledge

         Section 1. Security Interest and Pledge. As collateral security for the
prompt payment in full, when due, of all of the  obligations,  indebtedness  and
liabilities of Debtor to Secured  Parties  arising  pursuant to or in connection
with the Notes or this  Agreement,  whether now existing or  hereafter  arising,
whether direct, indirect, fixed, contingent,  liquidated,  unliquidated,  joint,
several,  or joint and  several,  Debtor  hereby  pledges  and grants to Secured
Parties,  a second security interest in and to all of Debtor's right,  title and
interest in and to the following  (such  property  being  hereinafter  sometimes
called the "Collateral"):

         (a) all accounts, accounts receivable,  documents, instruments, chattel
paper, and general  intangibles of Debtor and all products and proceeds thereof;
and

         (b) all equipment, inventory, machinery, and fixtures of Debtor and all
accessions thereto and all products and proceeds thereof;

<PAGE>

provided, however, the Collateral shall exclude (i) all Intellectual Property of
Debtor and its  subsidiaries  (for  purposes  of this  Agreement,  "Intellectual
Property"  means,  with respect to any entity,  proprietary  information,  trade
secret or knowledge,  including,  without limitation,  confidential information,
patents, trademarks,  service marks, inventions,  products, designs, development
techniques,   methods,  know-how,   techniques,   systems,  processes,  software
programs, works of authorship, formulae and any other information of a technical
nature),  and (ii) all collateral  evidenced by that certain Security Agreement,
dated as of November 29,  2000,  by and between  Probex  Fluids  Recovery,  Inc.
("PFR"),  a wholly-owned  subsidiary of the Debtor, and Wilmington Trust Company
("WTC"),  as  collateral  agent  for the  holders  of  PFR's 7%  Senior  Secured
Convertible Notes Due November 2004, which includes,  but is not limited to, all
accounts, accounts receivable,  documents,  instruments,  chattel paper, general
intangibles,  equipment,  inventory,  machinery, and fixtures and all accessions
thereto and all products and proceeds  thereof of PFR, and all capital  stock of
PFR evidenced by that certain Pledge  Agreement,  dated as of November 29, 2000,
by and between the Debtor and WTC and  acknowledged  by PFR  (collectively,  the
"PFR Assets"), all of which are subject to a lien and security interest in favor
of the holders of PFR's 7% Senior Secured Convertible Notes Due November 2004.

         Section 1. 2  Obligations.  The  Collateral  shall secure the following
obligations,  indebtedness  and liabilities of Debtor (all such  obligations and
indebtedness being hereinafter sometimes called the "Obligations"):

         (a) the  obligations  and  indebtedness  of Debtor to  Secured  Parties
evidenced by the Notes;

         (b)  all  costs  and  expenses,   including,  without  limitation,  all
reasonable  attorneys' fees and legal expenses,  incurred by Collateral Agent to
preserve and maintain the Collateral,  collect the obligations herein described,
and enforce this Agreement;

         (c) all extensions, renewals and modifications of any of the foregoing.

                         Representations and Warranties

         To  induce  Secured  Parties  to  enter  into  this  Agreement,  Debtor
represents and warrants to Secured Parties that:

         Section 2.1 Title.  Except for the first security  interest  granted to
the secured parties named in that certain Security  Agreement dated February 20,
2001 (the "First Secured  Parties"),  and the security  interest granted herein,
Debtor owns, and with respect to the Collateral  acquired after the date hereof,
Debtor will own, the Collateral free and clear of any lien,  security  interest,
or other encumbrance.

         Section 2.2 Accounts.  Unless Debtor has given Collateral Agent written
notice  to the  contrary,  whenever  the  security  interest  granted  hereunder
attaches to an account, Debtor shall be deemed to have represented and warranted
to Secured  Parties as to each and all of its accounts  that (i) each account is
genuine and in all respects what it purports to be, (ii) each account represents

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the legal,  valid,  and  binding  obligation  of the account  debtor  evidencing
indebtedness  unpaid  and  owed  by  such  account  debtor  arising  out  of the
performance  of labor or  services  by  Debtor  or the sale or lease of goods by
Debtor,  (iii) the amount of each  account  represented  as owing is the correct
amount  actually and  unconditionally  owing  except for normal trade  discounts
granted in the ordinary  course of  business,  and (iv) no account is subject to
any offset, counterclaim, or other defense.

         Section 2.3  Financing  Statements.  No financing  statement,  security
agreement,  or other lien instrument  covering all or any part of the Collateral
is on file in any  public  office,  except  as may have  been  filed in favor of
Cambridge  Strategies,  LLC, collateral agent for the First Secured Parties, and
Collateral Agent pursuant to this Agreement.

         Section 2.4  Organization  and Authority.  Debtor is a corporation duly
organized, validly existing, and in good standing under the laws of its state of
incorporation. Debtor has the corporate power and authority to execute, deliver,
and perform this Agreement, and the execution, delivery, and performance of this
Agreement by Debtor has been authorized by all necessary corporate action on the
part of Debtor and does not and will not violate any law,  rule or regulation or
the certificate of  incorporation  or bylaws of Debtor and does not and will not
conflict  with,  result  in a breach  of,  or  constitute  a  default  under the
provisions of any indenture,  mortgage,  deed of trust,  security agreement,  or
other instrument or agreement pursuant to which Debtor or any of its property is
bound.

         Section  2.5  Principal  Place  of  Business.  The  principal  place of
business and chief executive office of Debtor, and the office where Debtor keeps
its books and records, is located at the address of Debtor shown beside its name
on the signature page hereof.

         Section 2.6  Location of  Collateral.  All  inventory,  machinery,  and
equipment of Debtor are located in Dallas County or Denton County, Texas.

                       Affirmative and Negative Covenants

         Debtor covenants and agrees with Secured Parties that:

         Section 3.1  Maintenance.  Debtor shall maintain the Collateral in good
operating  condition and repair and shall not permit any waste or destruction of
the  Collateral  or any  part  thereof.  Debtor  shall  not  use or  permit  the
Collateral to be used in violation of any law or  inconsistently  with the terms
of any policy of insurance.  Debtor shall not use or permit the Collateral to be
used in any  manner  or for any  purpose  that  would  impair  the  value of the
Collateral or expose the Collateral to unusual risk.

         Section 3.2 Encumbrances. Debtor shall not create, permit, or suffer to
exist, and shall defend the Collateral against, any lien, security interest,  or
other  encumbrance on the Collateral  except the pledge and security interest of
the First  Secured  Parties  and Secured  Parties  hereunder,  and shall  defend
Debtor's rights in the Collateral and Secured Parties'  security interest in the
Collateral against the claims of all others, except the First Secured Parties.

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<PAGE>

         Section 3.3  Modification  of  Collateral.  Debtor  shall do nothing to
impair the  rights of  Secured  Parties  in the  Collateral.  Without  the prior
written  consent of  Collateral  Agent,  Debtor shall not grant any extension of
time for any payment with respect to the Collateral, or compromise, compound, or
settle  any of the  Collateral,  or  release  in whole or in part any  person or
entity liable for payment with respect to the Collateral, or allow any credit or
discount  for payment  with  respect to the  Collateral  other than normal trade
discounts  granted in the  ordinary  course of  business,  or release  any lien,
security interest, or assignment securing the Collateral,  or otherwise amend or
modify any of the Collateral.

         Section  3.4 Sale of  Collateral.  Debtor  shall not sell,  assign,  or
otherwise  dispose  of the  Collateral  or any part  thereof  without  the prior
written  consent  of  Collateral  Agent,  other than in the  ordinary  course of
business of Debtor and its subsidiaries.

         Section 3.5 Further Assurances. At any time and from time to time, upon
the request of Collateral Agent, and at the sole expense of Debtor, Debtor shall
promptly execute and deliver all such further instruments and documents and take
such  further  action  as  Secured  Parties  may deem  reasonably  necessary  or
desirable to preserve and perfect their security  interest in the Collateral and
carry out the  provisions  and purposes of this  Agreement,  including,  without
limitation,  the execution and filing of such financing statements as Collateral
Agent  may  require.  A  carbon,  photographic,  or other  reproduction  of this
Agreement or of any  financing  statement  covering the  Collateral  or any part
thereof  shall be  sufficient  as a  financing  statement  and may be filed as a
financing statement.

         Section 3.6 Risk of Loss;  Insurance.  Debtor shall be responsible  for
any loss of or damage to the Collateral. Debtor shall maintain, with financially
sound and reputable  companies,  insurance  policies (i) insuring the Collateral
against loss by fire,  explosion,  theft, and such other risks and casualties as
are  customarily  insured  against by  companies  engaged in the same or similar
business,  and (ii)  insuring  Debtor,  the First  Secured  Parties  and Secured
Parties  against  liability for personal  injury and property damage relating to
the  Collateral and the operation of Debtor's  business,  such policies to be in
such  amounts and  covering  such risks as are  customarily  insured  against by
companies  engaged  in the same or  similar  business,  with  losses  payable to
Debtor,  the First  Secured  Parties  and  Secured  Parties as their  respective
priority  interests  may appear.  All insurance  with respect to the  Collateral
shall provide that no cancellation,  reduction in amount,  or change in coverage
thereof shall be effective unless Collateral Agent has received thirty (30) days
prior written notice thereof. Debtor shall deliver to Collateral Agent copies of
all insurance policies covering the Collateral or any part thereof upon request.
In  addition,  Debtor  shall cause  Probex  Fluids  Recovery,  Inc.,  a Delaware
corporation and Debtor's wholly-owned subsidiary, to maintain insurance policies
in such amounts and covering such risks as are  customarily  insured  against by
companies engaged in the same or similar business.

         Section 3.7 Warehouse  Receipts  Non-Negotiable.  Debtor agrees that if
any  warehouse  receipt,  or receipt in the nature of a  warehouse  receipt,  is
issued with respect to any of its inventory,  such warehouse receipt, or receipt
in the  nature  thereof,  shall  not be  "negotiable"  (as such  term is used in
Section 7-104 of the Uniform Commercial Code as adopted by the State of Texas).


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<PAGE>

         Section 3.8 Inspection Rights. Debtor shall permit Collateral Agent and
its representatives to examine or inspect the Collateral wherever located and to
examine, inspect, and copy Debtor's books and records at any reasonable time and
as often as Collateral Agent may desire.

         Section  3.9  Taxes.  Debtor  agrees  to  pay  or  discharge  prior  to
delinquency  all taxes,  assessments,  levies,  and other  governmental  charges
imposed on it or its  property,  except  Debtor  shall not be required to pay or
discharge any tax,  assessment,  levy, or other  governmental  charge if (i) the
amount or  validity  thereof  is being  contested  by  Debtor  in good  faith by
appropriate proceedings diligently pursued, (ii) such proceedings do not involve
any risk of sale, forfeiture, or loss of the Collateral or any interest therein,
and (iii) adequate  reserves  therefor have been  established in conformity with
generally accepted accounting principles.

         Section  3.10  Obligations.  Debtor shall duly and  punctually  pay and
perform the Obligations.

         Section 3.11  Notification.  Debtor shall  promptly  notify  Collateral
Agent  of (i)  any  lien,  security  interest,  encumbrance,  or  claim  made or
threatened  against the Collateral,  (ii) any material change in the Collateral,
including, without limitation, any material damage to or loss of the Collateral,
and (iii) the occurrence or existence of any Event of Default (as defined in the
Notes) or the  occurrence or existence of any condition or event that,  with the
giving of notice or lapse of time or both, would be an Event of Default.

         Section  3.12  Corporate  Changes.  Debtor  shall not  change its name,
identity,  or corporate  structure  in any manner that might make any  financing
statement filed in connection with this Agreement  seriously  misleading  unless
Debtor shall have given  Collateral  Agent thirty (30) days prior written notice
thereof and shall have taken all action deemed reasonably necessary or desirable
by Collateral Agent to make each financing  statement not seriously  misleading.
Debtor shall not change its principal place of business, chief executive office,
or the place  where it keeps its books and  records  unless it shall  have given
Collateral  Agent thirty (30) days prior written  notice  thereof and shall have
taken all action deemed reasonably necessary or desirable by Collateral Agent to
cause the security  interest in the Collateral to be perfected with the priority
required by this Agreement.

         Section 3.13 Books and Records; Information. Debtor shall keep accurate
and  complete  books and records of the  Collateral  and  Debtor's  business and
financial condition in accordance with generally accepted accounting  principles
consistently  applied.  Debtor  shall  from  time  to  time  at the  request  of
Collateral  Agent deliver to  Collateral  Agent such  information  regarding the
Collateral and Debtor, to the extent publicly disclosed, as Collateral Agent may
reasonably request, including, without limitation, lists and descriptions of the
Collateral and evidence of the identity and existence of the Collateral.  Debtor
shall mark its books and  records to reflect  the  security  interest of Secured
Parties under this Agreement.

         Section 3.14  Compliance  with  Agreements.  Debtor shall comply in all
material  respects with all mortgages,  deeds of trust,  instruments,  and other
agreements binding on it or affecting its properties or business.

         Section  3.15  Compliance  with  Laws.  Debtor  shall  comply  with all
applicable  laws,  rules,  regulations,  and orders of any court or governmental
authority.

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<PAGE>


         Section 3.16 Location of  Collateral.  Debtor shall not move any of its
equipment,  machinery,  or inventory from the locations specified herein without
the prior written consent of Collateral Agent.

         Section 3.17 Intellectual  Property.  So long as any of the Obligations
remain  outstanding,  Debtor shall not create,  permit,  or suffer to exist, any
lien, security interest, or other encumbrance on, and shall not sell, assign, or
otherwise dispose of, the Intellectual  Property, in any case, without the prior
written consent of Collateral Agent; provided,  however, the foregoing shall not
limit  the  Debtor's  or its  subsidiaries'  ability  to  license  or  otherwise
distribute  the  Intellectual  Property while  retaining its ownership  interest
therein.

                      Rights of Secured Parties and Debtor

         Section 4.1 Power of Attorney.  DEBTOR HEREBY  IRREVOCABLY  CONSTITUTES
AND APPOINTS COLLATERAL AGENT AND ANY OFFICER OR AGENT THEREOF,  WITH FULL POWER
OF SUBSTITUTION,  AS ITS TRUE AND LAWFUL  ATTORNEY-IN-FACT WITH FULL IRREVOCABLE
POWER AND  AUTHORITY  IN THE PLACE AND STEAD AND IN THE NAME OF DEBTOR OR IN ITS
OWN NAME, FROM TIME TO TIME IN COLLATERAL  AGENT'S  DISCRETION,  TO TAKE ANY AND
ALL ACTION AND TO EXECUTE ANY AND ALL  DOCUMENTS  AND  INSTRUMENTS  WHICH MAY BE
NECESSARY OR DESIRABLE TO ACCOMPLISH THE PURPOSES OF THIS AGREEMENT.  THIS POWER
OF  ATTORNEY  IS A POWER  COUPLED  WITH AN  INTEREST  AND SHALL BE  IRREVOCABLE.
Collateral  Agent  shall  not be under  any duty to  exercise  or  withhold  the
exercise of any of the rights,  powers,  privileges,  and options  expressly  or
implicitly granted to Secured Parties in this Agreement, and shall not be liable
for any failure to do so or any delay in doing so. Collateral Agent shall not be
liable for any act or  omission  or for any error of  judgment or any mistake of
fact or law in its  individual  capacity or in its capacity as  attorney-in-fact
except acts or omissions  resulting from its willful  misconduct.  This power of
attorney is  conferred on  Collateral  Agent  solely to protect,  preserve,  and
realize upon Secured Parties' security interest in the Collateral.

         Section 4.2 Secured  Parties' Duty of Care.  Other than the exercise of
reasonable care in the physical  custody of the Collateral while held by Secured
Parties  hereunder,  Secured  Parties shall not have any  responsibility  for or
obligation  or duty with  respect  to all or any part of the  Collateral  or any
matter or  proceeding  arising out of or relating  thereto,  including,  without
limitation, any obligation or duty to collect any sums due in respect thereof or
to protect or preserve  any rights  against  prior  parties or any other  rights
pertaining  thereto;  it  being  understood  and  agreed  that  Debtor  shall be
responsible for  preservation of all rights in the Collateral.  Without limiting
the generality of the foregoing, Secured Parties shall be conclusively deemed to
have  exercised  reasonable  care in the custody of the  Collateral,  if Secured
Parties take such action,  for purposes of preserving  rights in the Collateral,
as Debtor may reasonably request in writing, but no failure or omission or delay
by Secured Parties in complying with any such request by Debtor,  and no refusal
by Secured Parties to comply with any such request by Debtor, shall be deemed to
be a failure to exercise reasonable care.


                                       6

<PAGE>



                                     Default

         Section 5.  Rights and  Remedies.  If any event of default  shall occur
under either the Notes or this Agreement,  Secured Parties shall have all of the
rights and  remedies of secured  parties  under the Uniform  Commercial  Code as
adopted by the State of Texas as well as any other rights and remedies permitted
under or provided by applicable law.

                         Agreement Among Secured Parties

         Section 6.1 Financing Statement. Secured Parties together will file one
financing statement covering all of the Collateral in the name of the Collateral
Agent  in  order  to  simultaneously  perfect  their  security  interest  in the
Collateral.

         Section 6.2 Appointment of Collateral Agent. Collateral Agent is hereby
appointed, empowered and authorized to act as the agent-in-fact for each Secured
Party for the sole  purpose of filing the  financing  statements  and  enforcing
Secured Parties' rights under their  respective  Notes and this Agreement.  Each
Secured  Party hereby  appoints  and  authorizes  Collateral  Agent to take such
action as agent on its behalf and to exercise  such powers under this  Agreement
as are  delegated to Collateral  Agent by the terms  hereof,  together with such
powers as are  reasonably  incidental  thereto.  As to any matters not expressly
provided for by this  Agreement and the Notes,  Collateral  Agent may, but shall
not be  required  to,  exercise  discretion  or to take any action that it deems
reasonable,  but shall be  required  to act or to refrain  from  acting upon the
written  instructions  of  all  of  Secured  Parties;  provided,  however,  that
Collateral  Agent  shall not be  required to take any action that is contrary to
this Agreement, the Notes or applicable law.

         Section 6.3 Duties. Collateral Agent shall have the exclusive authority
to seek  administration,  enforcement and collection of the Debtor's obligations
under  each of the  Notes  and  this  Agreement.  Absent  the  unwillingness  of
Collateral  Agent to enforce  Secured  Parties'  rights  under  this  Agreement,
Secured  Parties  shall  refrain  from  independently   seeking  collection  and
enforcement of the obligations  under this Agreement.  If one of Secured Parties
shall obtain any payment or funds,  except as otherwise  expressly  provided for
herein  (whether  voluntary,  involuntary,  through the exercise of any right of
set-off  or  otherwise),  in  excess  of its pro rata  share of  payments,  such
recipient  Secured Party shall pay to the Collateral Agent its pro rata share of
such excess payment or funds,  and Collateral  Agent shall reallocate such funds
pro rata  among  all of  Secured  Parties.  If all or a portion  of any  payment
received  by one of  Secured  Parties  is held to  constitute  a  preference  or
otherwise  recovered under the bankruptcy  laws, or if for any other reason such
Secured  Party is required to refund such  payment or pay the amount  thereof to
Debtor or any third party, the Collateral Agent shall pay such Secured Party its
pro rata share of such recovered payment.

         Section  6.4  Enforcement.  Upon  enforcement  and  collection  of  the
obligations in whole or in part under this Agreement, Secured Parties will share
pro rata in the proceeds resulting from such collections based upon the ratio of
the amount due and owing to Secured Parties under their  respective Notes to the
aggregate amount due and owing under all of the Notes.

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<PAGE>


                                  Miscellaneous

         Section 7.1 No Waiver;  Cumulative Remedies.  No failure on the part of
Secured Parties to exercise and no delay in exercising, and no course of dealing
with respect to, any right,  power,  or  privilege  under this  Agreement  shall
operate as a waiver  thereof,  nor shall any single or partial  exercise  of any
right,  power, or privilege under this Agreement  preclude any further  exercise
thereof or the exercise of any other right, power, or privilege.  The rights and
remedies  provided for in this Agreement are cumulative and not exclusive of any
rights and remedies provided by law.

         Section 7.2  Successors and Assigns.  This  Agreement  shall be binding
upon and inure to the benefit of Debtor and Secured Parties and their respective
heirs, personal representatives,  successors and assigns, except that Debtor may
not assign any of its rights or  obligations  under this  Agreement  without the
prior written consent of Secured Parties.

         Section 7.3 Amendment;  Entire Agreement.  THIS AGREEMENT  EMBODIES THE
FINAL,  ENTIRE  AGREEMENT  AMONG THE PARTIES  HERETO AND  SUPERSEDES ANY AND ALL
PRIOR COMMITMENTS,  AGREEMENTS,  REPRESENTATIONS,  AND  UNDERSTANDINGS,  WHETHER
WRITTEN  OR  ORAL,  RELATING  TO  THE  SUBJECT  MATTER  HEREOF  AND  MAY  NOT BE
CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OR DISCUSSIONS OF THE PARTIES  HERETO.  THERE ARE NO ORAL  AGREEMENTS
AMONG THE PARTIES  HERETO.  The  provisions of this  Agreement may be amended or
waived only by an instrument in writing signed by the parties hereto.

         Section 7.4 Notices. All notices and other communications  provided for
in this Agreement  shall be given or made in writing and  telecopied,  mailed by
certified mail return receipt requested,  or delivered to the intended recipient
at the "Address for Notices"  specified  beside its name on the signature  pages
hereof; or, as to any party at such other address as shall be designated by such
party in a notice to the other  party  given in  accordance  with this  Section.
Except as otherwise provided in this Agreement, all such communications shall be
deemed to have  been  duly  given  when  transmitted  by  telecopy,  subject  to
telephone  confirmation of receipt, or when personally delivered or, in the case
of a mailed notice,  three (3) days business days after deposit in the mails, in
each case given or addressed as aforesaid.

         Section 7.5 Applicable Law; Venue;  Service of Process.  This Agreement
shall be governed by and construed in  accordance  with the laws of the State of
TEXAS and the applicable laws of the United States of America.

         Section 7.6 Counterparts.  This Agreement may be executed in any number
of  counterparts,  each of which shall be deemed an  original,  but all of which
together shall constitute one and the same agreement.

         Section 7.7  Severability.  Any  provision of this  Agreement  which is
prohibited or unenforceable in any jurisdiction  shall, as to such jurisdiction,
be ineffective to the extent of such  prohibition  or  unenforceability  without
invalidating  the  remaining   provisions  of  this  Agreement,   and  any  such

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<PAGE>

prohibition  or  unenforceability  in any  jurisdiction  shall not invalidate or
render unenforceable such provision in any other jurisdiction.

         Section 7.8 Headings.  The headings,  captions and arrangements used in
this Agreement are for convenience only and shall not affect the  interpretation
of this Agreement.

         Section 7.9 Construction.  Debtor and Secured Parties  acknowledge that
each of them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Agreement with its legal counsel and that
this  Agreement  shall be construed as if jointly  drafted by Debtor and Secured
Parties.



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         IN  WITNESS  WHEREOF,  the  parties  hereto  have  duly  executed  this
Agreement as of the day and year first written above.

                                     DEBTOR:


                                     PROBEX CORP.,
                                     a Delaware corporation
Address:

13355 Noel Road, Suite 1200          By:_____________________________
Dallas, Texas 75240                  Name:___________________________
Attn: Charles M. Rampacek, CEO       Title:__________________________
Facsimile:  (972) 980-8545















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<PAGE>



                                            COLLATERAL AGENT:
                                            ----------------

Address:                                    Falcon Capital Management, LLC

3204 Long Prairie Road, Suite C             By:      ______________________
Flower Mound, Texas 75022                   Name:    ______________________
Attn:  Nicholas W. Hollingshad              Title:   ______________________
Facsimile:  (972) 355-7204


                                            SECURED PARTIES:
                                            ---------------


Address:
                                            -------------------------------
ERM-Southwest, Inc.                         Nicholas W. Hollingshad
3204 Long Prairie Road, Suite C
Flower Mound, Texas 75022
Attn: Nicholas W. Hollingshad
Facsimile: (972) 355-7204

Address:
                                            -------------------------------
ERM-Southwest, Inc.                         H. Reiffert Hedgcoxe
16300 Katy Freeway, Suite 300
Houston, Texas 77094
Attn: H. Reiffert Hedgcoxe
Facsimile: (281) 600-1001

Address:
                                            -------------------------------
ERM-Southwest, Inc.                         Annette Brewster
16300 Katy Freeway, Suite 300
Houston, Texas 77094
Attn: Annette Brewster
Facsimile: (281) 600-1001

Address:
                                            -------------------------------
ERM-Southwest, Inc.                         Mark C. Stuckey
7700 Chevy Chase Drive, Suite 110
Austin, Texas 78752
Attn: Mark C. Stuckey
Facsimile: (512) 459-4711

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<PAGE>



Address:
                                            -------------------------------
ERM-Southwest, Inc.                         Kenneth R. Schroeder
16300 Katy Freeway, Suite 300
Houston, Texas 77094
Attn: Kenneth R. Schroeder
Facsimile: (281) 600-1001

Address:
                                            -------------------------------
ERM-Southwest, Inc.                         Timothy J. Prince
7700 Chevy Chase Drive, Suite 110
Austin, Texas 78752
Attn: Timothy J. Prince
Facsimile: (512) 459-4711

Address:
                                            -------------------------------
ERM-Southwest, Inc.                         Shawn B. Doherty
16300 Katy Freeway, Suite 300
Houston, Texas 77094
Attn: Shawn B. Doherty
Facsimile: (281) 600-1001

Address:
                                            -------------------------------
ERM-Southwest, Inc.                         Lance R. Cooper
3204 Long Prairie Road, Suite C
Flower Mound, Texas 75022
Attn: Lance R. Cooper
Facsimile: (972) 355-7204


Address:
                                            General Conference of Seventh-day
                                            Adventists - Micro Cap Fund
General Conference Corporation
of Seventh-day Adventists
12501 Old Columbia Pike
Silver Spring, Maryland 20804               By:   _________________________
Attn: ____________________                  Name: _________________________
Facsimile: ________________                 Title:_________________________



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<PAGE>



Address:
                                            Bischoff Family Partners
5000 Battery Lane #1006
Bethesda, MD 20814                          By:      _________________________
Attn: _______________                       Name:    _________________________
Facsimile:____________                      Title:   _________________________


Address:
                                            -------------------------------
6902 Sycamore Ave.                          Jerry H. Jennings
Takoma Park, Maryland 20912
Attn: Jerry H. Jennings                     _______________________________
Facsimile: ______________                   Margie Sue Jennings

Address:
                                            -------------------------------
7803 Cole Ave.                              John R. Minesinger
Takoma Park, Maryland 20912
Attn: John R. Minesinger
Facsimile: ______________

Address:
                                            -------------------------------
Probex Corp.                                Charles M. Rampacek
13355 Noel Road, Suite 1200
Dallas, Texas 75240
Attn: Charles M. Rampacek
Facsimile: (972) 980-7068

Address:
                                            -------------------------------
Probex Corp.                                David J. McNiel
13355 Noel Road, Suite 1200
Dallas, Texas 75240
Attn: David J. McNiel
Facsimile: (972) 980-7068






                                       13
<PAGE>



Address:
                                            Marcus Blum and Gary L. Blum Trust
Pamaco, Inc.
3401 Oak Lane                               By:      ________________________
Dallas, Texas 75226                         Name:    ________________________
Attn: _________________                     Title:   ________________________
Facsimile: _____________

Address:
                                            -------------------------------
54 Palmer Woods                             E. Bruce McClendon
The Woodlands, Texas 77381
Attn: E. Bruce McClendon
Facsimile:
           ------------------------



















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