Exhibit 10.37


Neither this Option nor the shares of Common Stock  issuable on exercise of this
Option have been  registered  under the  Securities Act of 1933, as amended (the
"Act").   None  of  such  securities  may  be  transferred  in  the  absence  of
registration  under the Act or an opinion  of  counsel  to the effect  that such
registration is not required.

                             IDM ENVIRONMENTAL CORP.

                               Stock Option Grant

     This Non-Qualified  Stock Option Agreement ("Option  Agreement") is between
IDM  Environmental  Corp., a New Jersey  corporation (the "Company"),  and Aaron
Lehman, ("Optionee"), who agree as follows:

     1.  This  certifies  that  the  Optionee,   in  consideration  of  valuable
consulting  services  rendered to the Company,  is entitled to purchase from the
Company  twenty  thousand  (20,000)  shares of the  Company's  common stock (the
"Common Stock") at an exercise price equal to $4.813 per share.

     2. All rights granted under this Option shall expire on February 5, 2000.

     3.  Notwithstanding  anything  to the  contrary  contained  herein,  Holder
(defined  below) shall not have the right to exercise this Option so long as and
to the extent that at the time of such  exercise,  such exercise would cause the
Holder then to be the  "beneficial  owner" of five  percent  (5%) or more of the
Company's  then  outstanding   Common  Stock.  For  purposes  hereof,  the  term
"beneficial owner" shall have the meaning ascribed to it in Section 13(d) of the
Securities  Exchange Act of 1934,  as amended.  The opinion of legal  counsel to
Holder,  in form and  substance  satisfactory  to the Company and the  Company's
counsel shall prevail in all matters relating the amount of Holder's  beneficial
ownership.

     4. This  Option and the Common  Stock  issuable  on exercise of this Option
(the "Underlying  Shares") may be transferred,  sold,  assigned or hypothecated,
only if  registered  by the Company under the Act or if the Company has received
from counsel to the Company a written opinion to the effect that registration of
the Option or the  Underlying  Shares is not necessary in  connection  with such
transfer,  sale,  assignment  or  hypothecation.  The Option and the  Underlying
Shares  shall be  appropriately  legended to reflect this  restriction  and stop
transfer  instructions shall apply. The Holder shall through its counsel provide
such information as is reasonably necessary in connection with such opinion.

     5. This Option may only be assigned to entities controlled by the Optionee.
Any  permitted  assignment of this Option shall be effected by the Holder by (I)
executing a letter of  assignment  (in a form  acceptable to the Company and its
counsel);  (ii)  surrendering  the Option for  cancellation at the office of the
Company, accompanied by the opinion of counsel to the Company referred to above;
and (iii)  delivery  to the  Company  of a  statement  by the  Holder (in a form
acceptable to the Company and its counsel) that such Option is being acquired by
the Holder for  investment  and not with a view to its  distribution  or resale;
whereupon the Company shall issue,  in the name or names specified by the Holder
(including  the Holder)  new Options  representing  in the  aggregate  rights to
purchase  the same  number of  Underlying  Shares as are  purchasable  under the
Option surrendered.  Such Options shall be exercisable immediately upon any such
assignment  of the  number of  Options  assigned.  The  transferor  will pay all
relevant  transfer taxes.  Replacement  options shall bear the same legend as is
borne by this Option.


<PAGE>


     6. The term  "Holder"  should be deemed to  include  any  permitted  record
transferee of this Option.

     7. The Company  covenants  and agrees that all shares of Common Stock which
may be issued upon  exercise  hereof will,  upon  issuance,  be duly and validly
issued,  fully paid and  non-assessable and no personal liability will attach to
the holder thereof.  The Company further  covenants and agrees that,  during the
periods within which this Option may be exercised, the Company will at all times
have  authorized and reserved a sufficient  number of shares of Common Stock for
issuance upon exercise of this Option and all other options.

     8. This Option  shall not entitle the Holder to any voting  rights or other
rights as a stockholder of the Company.

     9. In the event that as a result of reorganization,  merger, consolidation,
liquidation,  recapitalization,  stock  split,  combination  of  shares or stock
dividends  payable with respect to such Common Stock, the outstanding  shares of
Common  Stock of the Company are at any time  increased  or decreased or changed
into or exchanged for a different  number or kind of share or other  security of
the  Company or of another  corporation,  then  appropriate  adjustments  in the
number and kind of such  securities  then  subject to this Option  shall be made
effective as of the date of such  occurrence  so that the position of the Holder
upon  exercise  will be the same as it would have been had it owned  immediately
prior to the  occurrence of such events the Common Stock subject to this Option.
Such adjustment shall be made successively whenever any event listed above shall
occur and the  Company  will  notify  the  Holder of each such  adjustment.  Any
fraction of a share  resulting from any  adjustment  shall be eliminated and the
price  per  share  of the  remaining  shares  subject  to this  Option  adjusted
accordingly.

     10. The Option herein granted may be exercised by the delivery by Holder of
written  notice to the  Secretary  of the  Company  setting  forth the number of
shares of Common Stock with respect to which the Option is being exercised.  The
notice shall be  accompanied by payment to the Company of the exercise price for
the number of  Underlying  Shares  specified  in the Notice.  Notice may also be
delivered  by  telecopy  provided  that the  exercise  price of such  shares  is
received  by the  Company.  The notice  shall  specify  the address to which the
certificates for such shares are to be mailed.


<PAGE>

 
     11. Within five business days  following each receipt by the Company of the
documents  required  to  exercise  all or any part of this Option as provided in
Section 10, the Company shall deliver  irrevocable  instruction  to its transfer
agent (with a copy to Holder) to issue  certificates  evidencing  the Underlying
Shares so  purchased.  Such  certificates  shall  bear  appropriate  legends  in
accordance with applicable securities laws.

     12. This Option shall be governed by and construed in  accordance  with the
laws of the State of New Jersey.  The  federal  and state  courts in the city of
Newark,  New Jersey shall have exclusive  jurisdiction  over this instrument and
the  enforcement  thereof.  Service of  process  shall be  effective  if sent by
certified mail,  return receipt  requested.  All notices shall be in writing and
shall  be  deemed  given  upon  receipt  by the  party to whom  addressed.  This
instrument  shall be enforceable  by decrees of specific  performance as well as
other remedies.

     IN WITNESS WHEREOF,  IDM  Environmental  Corp. has caused this Option to be
signed by its duly authorized  officer under its corporate seal, and to be dated
February 5, 1998.
 
                                                 IDM ENVIRONMENTAL CORP.



                                                 By: /S/  Joel Freedman
                                                   -----------------------------
                                                     Joel Freedman, President