BASIC LEASE INFORMATION:

LEASE DATE:             July 12, 2004

LANDLORD:               F.G.B.P. L.L.C., A Utah Limited Liability Company

ADDRESS OF LANDLORD:    12185 So. Business Park Dr. 102 West, Utah 84020

TENANT:                 Flexpoint Sensor Systems, Inc.   [Initials] [9/13/04]
ADDRESS OF TENANT:      12200 So. Business Park Dr. 106 West, Utah 84020
CONTACT:                John Sindt, President
TELEPHONE:              801 568-5111

PREMISES:               Approximately 11,639 rentable square feet

LEASE TERM:             Five (5) years Commencing October 1, 2004 [Initials]
                        Terminating September 30, 2009  [Initials]
BASE RENT:              $  6,500.00  per month

BASE RENT ANNUAL INCREASE:  2% Per Year

ESTIMATED BASIC OPERATING COSTS:  $1,876.00  per month (assumes Tenant
                                   provides own janitorial services and pays
                                   own utilities, and own maintenance)

TOTAL RENT:             $ 8,376.00 per month

TENANT'S PERCENTAGE SHARE OF OPERATING COSTS:    33.50 %

LANDLORD'S WORK- (Tenant Improvement Allowance): $00.00 Per rentable sq. ft.

        The foregoing Basic Lease Information is hereby incorporated into and
made a part of this Lease. In the event of any conflict between any Basic
Lease Information and the Lease, the latter shall control.

LANDLORD:                         TENANT:

F.G.B.P. L.L.C.                   Flexpoint Sensor Systems, Inc. <Initials
                                                                  OK 9/13/04>

     /s/ Alan Wheatley                 /s/ John Sindt, President
By:______________________         By:_____________________________
         Alan Wheatley                    John Sindt

     /s/ Gary Deaton
By:______________________         By:_____________________________
     Gary Deaton

     /s/ Don Watkins
By:_______________________
     Don Watkins

    /s/ David Blake
By:_____________________________
    David Blake


<PAGE>


                         LEASE AGREEMENT

        THIS LEASE made as of this 12TH day ofJuly, 2004 Between F.G.B.P.
L.L.C. ("Landlord") and  FLEXPOINT SENSOR SYSTEMS, INC. ("Tenant").

        Landlord hereby leases to Tenant and Tenant hereby leases from
Landlord those Premises ("Premises") as shown on Exhibit A attached hereto and
made a part hereof, specified in the Basic Lease Information attached hereto.

    1.    Occupancy.  Tenant shall use and occupy the Premises for general
office, manufacturing, assembly, and storage  purposes and for no other use or
purpose without the prior written consent of Landlord.

    2.    Term and Possession.

          a.    The term of this Lease ("Lease Term") shall be for the period
specified in the Basic Lease Information commencing on the Commencement Date,
and ending thereafter as specified in the Basic Lease Information (or until
sooner terminated as herein provided).

    3.    Rent.

          a.    Tenant shall pay to Landlord throughout the term of this Lease
rent as specified in the Basic Lease Information, payable in monthly
installments in advance on the first day of each month during every year of
the term, without deduction or offset whatsoever, to Landlord at the address
specified in the Basic Lease Information, or to such other firm or to such
other place as Landlord may from time to time designate in writing.  Said
rental is subject to adjustment as provided in Paragraph 27 hereof.  If this
Lease commences on a day other than the first day of a calendar month or ends
on a day other than the last day of a calendar month, the monthly rental for
the fractional month shall be appropriately prorated.  Base Rent shall be
increased by 2% on the first day of each anniversary of the Commencement Date.

          b.     Tenant agrees that if rent or any other payment due hereunder
from Tenant to Landlord remains unpaid ten (10) days after said amount is due,
the amount of such unpaid rent or other payment shall be increased by a late
charge to be paid Landlord by Tenant in an amount equal to five percent (5%)
of the amount of the delinquent rent or other payment.

    4.    Restrictions on Use.  Tenant shall not do or permit anything to be
done in or about the Premises which will in any way obstruct or interfere with
the rights of other tenants or occupants of the building or injure or annoy
them.   Tenant shall not do nor permit anything to be done on or about the
Premises or bring or keep anything therein which will in any way increase the
rate of any insurance upon the building in which the Premises are situated or
any of its contents or cause a cancellation of said insurance.

    5.    Compliance with Laws.  Tenant shall not use the Premises or permit
anything to be done in or about the Premises which will in any way conflict
with any law, or governmental rule now in force or which may hereafter be
enacted. Tenant shall at its sole cost promptly comply with all laws, and
governmental rules, now in force or which may hereafter be in force excluding
structural changes not related to alterations made by or for Tenant.

    6.    Alterations.  Tenant shall not make or suffer to be made any
alterations, to the Premises without the prior  written consent of Landlord.
Upon the expiration or sooner termination of the term herein provided, Tenant
shall upon demand by Landlord, at Tenant's sole cost remove all alterations,
made by  Tenant, designated by Landlord to be removed, and Tenant shall repair
and restore the Premises to their original condition.

    7.    Repair.  By signing this Lease, Tenant accepts the Premises as being
in the condition in which Landlord is obligated to deliver them. Tenant shall,
during the term hereof at Tenant's sole cost, keep the Premises in good
condition.

    8.    Liens.  Tenant shall keep the Premises free from any liens arising
out of any work performed, material furnished, or obligations incurred by
Tenant.  In the event that Tenant shall not, within twenty (20) days following
the imposition of any such lien, cause the same to be released of record by
payment or posting of a property bond, Landlord shall have, in addition to all
other remedies provided herein and by law, the right, but no obligation, to
cause the same to be released by such means as it shall deem proper, including
payment of the claim giving rise to such lien.  All such sums paid by Landlord
and all expenses incurred by it in connection therewith shall be considered
additional rent and shall be payable to it by Tenant on demand with interest
at the rate payable of eighteen percent (18%) per annum or two percent (2%)
above the prime rate of U. S. Bank, whichever is more. Tenant shall give
Landlord at least five (5) business days' prior notice of commencement of any
material construction on the Premises.

    9.    Assignment and Subletting.

          a.    Tenant shall not assign, encumber, or otherwise transfer  this
Lease or any interest herein, sublet the Premises or any part thereof without
the prior written consent of Landlord  which consent shall not be unreasonably
withheld.   A transfer by the present majority shareholders of ownership and
control of the voting stock of a corporate tenant, or a transfer of a
controlling interest in a partnership or proprietorship, as applicable, shall
be deemed an assignment for the purposes of this Paragraph.

          b.    Any subletting hereunder by Tenant shall not result in Tenant
being released or discharged from any liability under this Lease.

          c.    Landlord's consent to any assignment, encumbrances,
subletting, occupation, lien or other transfer shall not release Tenant from
any of Tenant's obligations hereunder or be deemed to be a consent to any
subsequent occurrence.

    10.   Insurance and Indemnification.

          a.    Landlord shall not be liable to Tenant and Tenant hereby
waives all claims against Landlord for any injury or damage to any person or
property in or about the Premises by any cause, other than Landlord's
negligence or willful acts.

          b.    Except for claims or liability resulting from the negligence
of Landlord, Tenant shall hold Landlord harmless from and defend Landlord
against any and all claims or liability for any injury or damage to any person
or property whatsoever:  (i) occurring in, on, or about the Premises, (ii)
occurring in, on, or about any facilities (including, without prejudice to the
generality of the term "facilities," elevators, stairways, passageways, or
hallways), the use of which Tenant may have in conjunction with other tenants
of the Building, when such injury or damage shall be caused in part or in
whole by the act, negligence, fault of, or omission of any duty with respect
to the same by Tenant, its agents, servants, employees, or invitees, and in
such case any action or proceeding brought against Landlord by reason of any
such claims or liability, Tenant agrees to defend such action or proceeding at
Tenant's sole expense by counsel reasonably satisfactory to Landlord.  The
provisions of this Paragraph 10 shall survive the expiration or termination of
this Lease with respect to any claims or liability occurring prior to such
expiration or termination.

          c.    Tenant agrees to purchase at its own expense and to keep in
force during the term of this Lease a policy or policies of worker's
compensation and comprehensive liability insurance, including personal injury
and property damage, in the amount of FIVE HUNDRED THOUSAND DOLLARS ($500,000)
for property damage and FIVE HUNDRED THOUSAND DOLLARS ($500,000) per person
and ONE MILLION DOLLARS  ($1,000,000) per occurrence for personal injuries or
deaths of person occurring in or about the Premises, or such other amount as
Landlord shall deem necessary, based on periodic insurance reviews in respect
to injury or damage to persons or property.  Said policies shall:  (i) name
Landlord as an additional insured and insure Landlord's contingent liability
under this Lease; (ii) be issued by an insurance company which is acceptable
to Landlord and licensed to do business in the state of Utah; and (iii)
provide that such insurance shall not be canceled unless thirty (30) days'
prior written notice shall have been given to Landlord.  Said policy or
policies or certificates thereof shall be delivered to Landlord by Tenant upon
commencement of the term of the Lease and upon each renewal of said insurance.

    11.   Waiver of Subrogation.  Landlord and Tenant hereby waive any right
that each may have against the other on account of any loss or damage arising
in any manner which is covered by policies of insurance for fire and extended
coverage, theft, public liability, worker's compensation, or other insurance
now or hereafter existing during the term hereof, provided, however, the
parties each shall first have their respective insurance companies waive any
rights of subrogation that such companies may have against Landlord or Tenant,
as the case may be.

    12.   Services and Utilities.

          a.    Subject to paragraph c below, Landlord shall maintain the
landscaped areas of the Building, the exterior of the Building, and the
structure itself, in reasonably good order and condition except for damage
occasioned by the act of the Tenant, which damage shall be repaired by
Landlord at Tenant's expense.

          b.    Provided the Tenant shall not be in default hereunder,
Landlord agrees to furnish to the Premises during ordinary business hours of
generally recognized business days, to be determined by Landlord , water and
electricity suitable for the intended use of the Premises, Tenant agrees at
all times to cooperate fully with Landlord and to abide by all the regulations
and requirements which Landlord may prescribe for the proper functioning and
protection of the heating, ventilating, and air-conditioning system.  Landlord
shall in no event be liable for any interruption or failure of utility
services on the Premises for conditions beyond its control.

          c.    If Tenant shall require water or electric current or any other
resource in excess of that usually furnished or supplied for use of the
Premises as general office space,   Landlord may cause a special meter to be
installed in the Premises so as to measure the amount of water, electric
current, or other resource consumed.  The cost of any such meters and of
installation, maintenance, and repair thereof shall be paid for by Tenant, and
Tenant agrees to pay Landlord promptly upon demand by Landlord for all such
water, electric current, or other resource consumed, as shown by said meters,
at the rate charged by the local public utility, furnishing the same, plus any
additional expense incurred in keeping account of the water, electric current,
or other resource so consumed.

          d.    Any sums payable under this Paragraph 12 shall be considered
additional rent and may be added to any installment or rent thereafter
becoming due, and Landlord shall have the same remedies for a default in
payment of such sum as for a default in the payment of rent.

    13.   Estoppel Certificate.

          a.    Within ten (10) days following any written request which
Landlord may make from time to time, Tenant shall execute and deliver to
Landlord a certificate substantially in the form attached hereto as Exhibit C
and made a part hereof, indicating thereon any exceptions thereto which may
exist at that time.  Failure of the Tenant to execute and deliver such
certificate shall constitute an acceptance of the Premises and acknowledgment
by Tenant that the statements included in Exhibit C are true and correct
without exception.


    14.   Holding Over.

          a.    Any holding over after the expiration of the term of this
Lease with the written consent of Landlord shall be a tenancy from month to
month.  The terms, covenants, and conditions of such tenancy shall be the same
as provided herein, and the monthly rental shall be the current rate plus 10%.
Acceptance by Landlord of rent after such expiration shall not result in any
tenancy or any renewal of the term of this Lease, and the provisions of this
Paragraph are in addition to and do not affect Landlord's right of reentry or
other rights provided under this Lease or by applicable law.

          b.    If Tenant shall retain possession of the Premises or any part
thereof without Landlord's consent following the expiration or sooner
termination of this Lease for any reason, then Tenant shall pay to Landlord
for each day of such retention one-hundred and fifty percent (150%) of the
daily rental for the last period prior to the date of such expiration or
termination, subject to adjustment as provided in Paragraph 27.  Tenant shall
also indemnify and hold Landlord harmless from any loss or liability resulting
from delay by Tenant in surrendering the Premises including, without
limitation, any claims made by any succeeding tenant founded on such delay.
Acceptance of rent by Landlord following expiration or termination shall not
constitute a renewal of this Lease, and nothing contained in this Paragraph
shall waive Landlord's right of reentry or any other right.

    15.   Subordination.  Without the necessity of any additional document
being executed by Tenant for the purpose of effecting a subordination, this
Lease shall be subject and subordinate at all times to the lien of any
mortgage or deed of trust which may now exist or hereafter be executed in any
amount for which said Building, land, or Landlord's interest or estate in any
of said items, is specified as security.  Notwithstanding the foregoing,
Landlord shall have the right to subordinate or cause to be subordinated any
such ground leases or underlying leases to this Lease.  In the event that any
ground lease or underlying lease terminates for any reason or any mortgage or
deed of trust is foreclosed or a conveyance in lieu of foreclosure is made for
any reason, Tenant shall, notwithstanding any subordination, attorn to and
become the Tenant of the successor in interest to Landlord at the option of
such successor in interest.  Tenant covenants and agrees to execute and
deliver, upon demand by Landlord and in the form reasonably requested by
Landlord, any additional documents evidencing the priority or subordination of
this Lease with respect to any such ground leases or the lien of any such
mortgage or deed of trust.

    16.   Rules and Regulations.  Tenant shall faithfully observe and comply
with the rules and regulations printed on or annexed to this Lease and all
reasonable modifications thereof and additions thereto from time to time put
into effect by Landlord.  Landlord shall not be responsible for the
nonperformance by any other tenant or occupant of the Building of any said
rules and regulations.

    17.   Reentry by Landlord.  Landlord reserves and shall at all times have
the right to reenter the Premises to inspect the same, to supply janitor
service and any other service to be provided by Landlord to Tenant hereunder.
For each of the aforesaid purposes, Landlord shall at all times have and
retain a key with which to unlock all of the doors in, upon, and about the
Premises, excluding Tenant's vaults and safes, or special security areas
(designated in advance), and Landlord shall have the right to use any and all
means which Landlord may deem necessary or proper to open said doors in an
emergency, in order to obtain entry to any portion of the Premises, and any
entry to the Premises, or portions thereof obtained by Landlord by any of said
means, or otherwise, shall not under any circumstances be construed or deemed
to be a forcible or unlawful entry into, or a detainer of, the Premises, or an
eviction, actual or constructive, of Tenant from the Premises or any portions
thereof.  After reasonable notice to Tenant, Landlord shall also have the
right, and without incurring any liability to Tenant therefore, to change the
arrangement and/or location of passageways, corridors, stairs, toilets, or
other public parts of the Building and to change the name, by which the
Building is commonly known.

    18.   Insolvency or Bankruptcy.  The appointment of a receiver to take
possession of all or substantially all of the assets of Tenant, or an
assignment of Tenant for the benefit of creditors, or any action taken or
suffered by Tenant under any insolvency, bankruptcy, or reorganization act,
shall at Landlord's option constitute a breach of this Lease by Tenant.  Upon
the happening of any such event or at any time thereafter, this Lease shall
terminate five (5) days after written notice of termination from Landlord to
Tenant.  In no event shall this Lease be assigned or assignable by operation
of law or by voluntary or involuntary bankruptcy proceedings or otherwise and
in no event shall this Lease or any rights or privileges hereunder be an asset
of Tenant under any bankruptcy, insolvency, or reorganization proceedings.

    19.1   Default by Tenant.

           The failure to perform or honor any covenant, condition, or
representation made under this Lease shall constitute a default hereunder by
Tenant.  Except as provided in Paragraph 3 above, Tenant shall not have any
grace period within which to cure any default in the payment of rental or
adjustment thereto, and Landlord shall not be required to give any notice to
Tenant of any such default before exercising any remedies available to
Landlord.  Tenant shall have a reasonable time from the date of written notice
from Landlord within which to cure any default under this Lease other than a
default in the payment of rental or adjustments thereto. Upon a default under
this Lease by Tenant, and failure to cure the default by Tenant within the
permissible time period, if any, Landlord shall have the following rights and
remedies in addition to, or as an alternative to, any other rights or remedies
available to Landlord at law or in equity:

           a.    Re-enter the Premises, take possession thereof, eject all
persons therefrom, and with or without re-entry, declare this Lease
terminated, in which event Tenant shall immediately pay Landlord a sum of
money equal to the amount, if any, by which the then discounted value of the
rent reserved under this Lease for the balance of the Lease Term exceeds the
then discounted reasonable rental value of the Premises for the balance of the
Lease Term (discounted to the date of termination at the rate of six percent
(6%) per annum) plus costs, expenses and reasonable attorney's fees.

           b.    Re-enter the Premises, take possession thereof, eject all
persons therefrom, and with or without terminating this Lease, relet the
Premises or any part thereof, for the account of Tenant upon such terms and
conditions as Landlord deems advisable, in which event the rents received from
such reletting shall be applied first to the expenses of such reletting and
collection, including clean-up, repair, and renovation or alteration of the
Premises, reasonable attorneys' fees, and real estate commissions paid, and
thereafter to payment of all sums due or to become due landlord under this
Lease.   Tenant shall pay landlord monthly, on or before the first day of each
month, any deficiency between the rent due under this Lease and the rent
received from such reletting less Landlord's expenses as set forth above in
subparagraph (a).

           c.    After terminating or without terminating this Lease, Landlord
may re-enter the Premises and take possession of any and all property
whatsoever found there and place such property in a public warehouse or
elsewhere for the account  and at the expense of Tenant. In the event of
default Tenant hereby grants Landlord a lien upon all  of Tenant's property in
the Premises.  Landlord may thereafter sell any or all of such property at
public or private sale in such manner and at such times and places as Landlord
in its sole discretion may deem proper, and shall apply the proceeds of such
sale; first, to the cost  and expenses of such sale, including reasonable
attorneys' fees; second, to the payment of the costs of or charges for storing
any such property; third, to the payment of any other sums of money which may
then or thereafter be due to Landlord from Tenant under any of the provisions
of this Lease; and fourth, the balance, if any, to Tenant.  Tenant hereby
waives all claims for damages that may be caused by Landlord's reentering and
taking possession of the Premises and/or removing, storing and disposing of
any property therein, and will hold Landlord harmless from all loss, costs
and/or damages occasioned thereby.

           d.    All of Landlord's rights and remedies are cumulative and not
exclusive, and the exercise of any right or remedy at any one time shall not
preclude the exercise of the same or any other right or remedy at any other
time.  No re-entry or taking possession of the Premises or any property
therein shall be construed as an election on Landlord's part to terminate this
Lease.
Termination of this Lease may only be by written notice of termination given
by Landlord to Tenant.  Landlord may, in its sole discretion, sue periodically
to recover damages, and  no action for damages shall bar a later action for
damages or any other remedy.  Unless and until this Lease is terminated as
provided in subparagraph (a) above, Tenant shall continue to be liable to
Landlord for rent and all other amounts owing under this Lease when and as
they become due, whether or not Tenant's possessions of the Premises has been
terminated, and whether or not the Premises are sublet by Landlord.

    19.2   Default by Landlord

           Landlord shall not be in default unless Landlord fails to perform
obligations of Landlord required under this Lease within a reasonable time,
but not less than thirty (30) days after written notice by Tenant to Landlord
and to the holder of any mortgage or deed of trust covering the Premise or
building in which the Premises is located whose name and address shall have
been furnished to Tenant.  Such notice must specify wherein Landlord has
failed to perform such obligation.  Notwithstanding the foregoing or any thing
herein to the contrary, if the nature of Landlord's obligation is such that
more than thirty (30) days are required for performance, then Landlord shall
not be in default if Landlord commences performance within such thirty (30)
day period and thereafter diligently prosecutes the same to completion.

    19.3  Consent to Notice Being Given to Principal of Tenant Affiliated
          With Landlord

            Tenant hereby consents that Landlord may, but shall not be
obligated to, give any notice required or permitted to be given to Tenant
pursuant to this Lease to any principal of Tenant who is also  affiliated,
directly or indirectly, in any way with Landlord, including Guarantors of this
Lease, and Members of F.G.B.P., LLC, and Tenant hereby releases Landlord, and
agrees to hold Landlord harmless from, any and all liability of any kind or
nature in any way arising out of or connected with giving such notice.

    20.   Damage by Fire, Etc.

          a.    If the Premises or the Building are damaged by fire or other
casualty, Landlord shall forthwith repair the same as speedily as possible as
possible at the expense of Landlord, unless Landlord shall elect not to
rebuild, as hereinafter provided and an equitable part of the rent shall be
abated until so repaired, based upon the time and to the extent the leased
premises are untenantable.

          b.    In case the Premises or the Building shall be destroyed or so
damaged by fire or other casualty, as to render more than twenty five percent
(25%) thereof untenantable, or in the event of any uninsured loss, or if the
unexpired term of this Lease is one and one-half (1-1/2) years or less on the
date of any destruction or damage, then either party may, if it so elects, by
notice in writing to the other party, within thirty (30) days after such
destruction or damage, terminate this Lease.

          c.    Landlord's obligation to repair or rebuild shall be limited to
basic building and the replacement of any original installations as Landlord's
Work.  In no event, in the case of any such destruction, shall Landlord be
required to repair or replace Tenant's inventory or Tenant Nonstandard Work.
Tenant covenants to make such repairs and replacements and to furnish
Landlord, on demand, evidence of insurance assuring its ability to do so.

    21.   Eminent Domain.

          a.    If the whole of the Premises shall be taken under the power of
eminent domain, then the term of this Lease shall cease as of the day
possession shall be taken and the rent shall be paid up to that date.

          b.      In the event more than forty percent (40%) of the Premises
shall be so taken, either party shall have the right to terminate this Lease
effective at the time provided in Subsection A above  upon giving the other
party written notice of termination within sixty (60)
days after the taking of possession by such authority.

          c.    If any of the floor area of the Premises shall be so taken,
then Tenant shall have the right either to terminate this Lease or, subject to
Landlord's right to termination as set forth in Subsection B above, to
continue in possession of the remainder of the Premises
upon notice in writing to landlord of Tenant's intention given within thirty
(30) days after such taking of possession, and if Landlord does not terminate,
all of the terms herein provided shall continue in effect except that the rent
shall be equitably abated as to any portion of the Premises so taken and
Landlord shall restore the Premises to a complete architectural unit but shall
not be required to expend any amounts in excess of its award nor be obligated
for any work excluded pursuant to this Lease.

          d.      All damages awarded for such taking under the power of
eminent domain, whether for the whole or part of the Premises, shall be the
property of Landlord, whether such damages shall be awarded as compensation
for diminution in value of the leasehold or to the fee of the Premises;
provided, however, that Landlord shall not be entitled to any separate award
made to Tenant for loss of business, depreciation to and cost of removal of
inventory, or to other separate awards payable to Tenant.

     22.  Sale by Landlord.  In the event of a sale or conveyance by Landlord
of the Building, the same shall operate to release Landlord from any future
liability upon any of the covenants or conditions, express or implied, herein
contained in favor of Tenant, and in such event Tenant agrees to look solely
to the responsibility of the successor in interest of Landlord in and to this
Lease.  This Lease shall not be affected by any such sale, and Tenant agrees
to attorn to the purchaser or assignee.

    23.   Right of Landlord to Perform.    If Tenant shall fail to pay any sum
of money, other than rent, required to be paid by it thereunder or shall fail
to perform any other act on its part to be performed hereunder, and such
failure shall continue for thirty (30) days after notice thereof by Landlord,
Landlord may, without thereby waiving or curing such failure and without
waiving or releasing Tenant from any obligation of Tenant, make any such
payment or perform any such act for the account of Tenant.

    24.   Surrender of Premises.

          a.    Tenant shall, at least thirty (30) days before the last day of
the term hereof, give to Landlord a written notice of intention to surrender
the Premises on that date, but nothing contained herein shall be construed as
an extension of the term hereof or as consent of Landlord to a holding over by
Tenant.

          b.    At the end of the term or any renewal thereof, or upon
termination of Tenant's right to possession, Tenant will deliver up to
Landlord possession of the Premises in good condition reasonable wear and tear
excepted. Tenant shall, prior to the termination of this Lease or termination
of Tenant's right to possession, remove all movable furniture and equipment
belonging to Tenant, at Tenant's sole cost, title to which shall be in Tenant
until such termination, repairing any damage caused by such removal.  Property
not so removed upon the termination of this Lease or upon termination of
Tenant's right to possession shall be deemed abandoned by Tenant, and title to
the same shall thereupon pass to Landlord.  Upon request by Landlord, unless
otherwise agreed to in writing by Landlord, Tenant shall remove, at Tenant's
sole cost, any or all permanent improvements or additions to the Premises
installed by or at the expense of Tenant.


    25.  Waiver.  If either Landlord or Tenant waives the performance of any
term, covenant, or condition contained in this Lease, such waiver shall not be
deemed to be a waiver of any subsequent breach of the same or any other term,
covenant, or condition contained herein.  Furthermore, the acceptance of rent
by Landlord shall not constitute a waiver of any preceding breach by Tenant of
any term, covenant, or condition of this Lease, regardless of Landlord's
knowledge of such preceding breach at the time Landlord accepted such rent.
Failure by Landlord to enforce any of the terms, covenants, or conditions of
this Lease for any length of time shall not be deemed to waive or to decrease
the right of Landlord to insist thereafter upon strict performance by Tenant.
Waiver by Landlord of any term, covenant, or condition contained in this Lease
may only be made by a written document signed by Landlord.

    26.   Notices.  All notices and demands which may be or are required to be
given by either party to the other hereunder shall be in writing.  All notices
and demands by Landlord to Tenant shall be sent by United States certified or
registered mail, postage prepaid, addressed to Tenant at the Premises, or to
such other place as Tenant may from time to time designated in a notice to
Landlord.  All notices and demands by Tenant to Landlord shall be sent by
United States certified or registered mail, postage prepaid, addressed to
Landlord at the address specified in the Basic Lease Information, or to such
other firm or to such other place as Landlord may from time to time designate
in a notice to Tenant.  All notices and demands shall be deemed given on the
date personally delivered to the address designated above or on the date
mailed as provided above.

    27.   Rental Adjustments.  In addition to Basic Rent provided to be paid
hereunder, Tenant shall pay, as Rent, Tenant's Proportionate Share of Basic
Operating Cost in the manner set forth below.

          a.    Definition:  For purposes hereof, the terms used in this
Paragraph 27 shall have the following meanings:

            (1)    "Basic Operating Cost" shall mean all expenses and costs of
every kind and nature which Landlord shall pay or become obligated to pay
because of or in connection with the operation of the Building:

                (i)    All wages of all employees engaged directly in the
operation, management, maintenance, engineering, and security of the Building;
provided, however, that Basic Operating Cost shall not include leasing
commissions paid to any real estate broker, salesperson, or agent.

                (ii)   Supplies, materials, tools, and rental of equipment
used in the operation, management, and maintenance of the Building.

                (iii)  Utilities, including water and power, gas, sewer,
heating, lighting, air conditioning and ventilating servicing the Building.

                (iv)   All maintenance, janitorial, and service agreements for
the Building and the equipment therein, including without limitation, alarm
services, garbage and waste disposal, security service, water treatment,
facade maintenance, roof maintenance, landscaping, window cleaning, and
heating and air conditioning equipment maintenance.

                (v)    A management cost recovery equal to five percent (5%)
of Gross Rent derived from the Building.

                (vi)   Legal expenses, accounting expenses, and the cost of
audits by certified public accountants:  provided, however, that legal
expenses chargeable as Basic Operating Cost shall not include the cost of
negotiating leases, collecting rents, evicting tenants, nor shall it include
costs incurred in legal proceedings with or against any tenant or to enforce
the provisions of any lease.

                (vii)  All insurance premiums and costs including, but not
limited to, the premiums and cost of fire, casualty and liability coverage and
rental abatement and earthquake insurance (if Landlord elects to provide such
coverage) applicable to the Building and Landlord's personal property used in
connection therewith.

                (viii) Repairs, replacements, and general maintenance
(excluding repairs and general maintenance paid by proceeds of insurance or by
Tenant or other third parties, and the alterations attributable solely to
tenants of the Building other than Tenant).

                (ix)   All maintenance costs relating to public and service
areas of the Building including (but without limitation) sidewalks,
landscaping, service areas, mechanical rooms, and Building exteriors.

                (x)    All taxes and assessments and governmental charges,
whether federal, state, county, or municipal, and whether by taxing districts
or authorities presently taxing the Building or by others, whether
subsequently created or otherwise.

                (xi)   Amortization (together with reasonable financing
charges) of capital improvements made to the Building subsequent to the Term
Commencement Date which will improve the operating efficiency of the Building
or which may be required to comply with laws, ordinances, rules or regulations
promulgated, adopted, or enforced after completion of the initial construction
of the Building and improvements of the Premises pursuant to the Office Lease
Improvement Agreement.

                (xii)  All costs of contesting any law applicable to the
Building or the amount of any taxes affecting the Building.

         Notwithstanding anything to the contrary herein contained, Basic
Operating Cost shall not include (aa) the initial construction cost of the
Building; (bb) depreciation on the initial construction of the Building; (cc)
the cost of providing Tenant Improvements to Tenant or any other tenant; (dd)
debt service (including, but without limitation, interest, principal, and any
impound payments) required to be made on any mortgage or deed of trust
recorded with respect to the Building and/or the real property on which the
Building is located other than debt service and financing charges imposed
pursuant to Paragraph 27 a.(1)(xi) above; and (ee) the cost of special
services, goods, or materials provided to any tenant.  In the event that the
Building is not fully occupied during any fiscal year of the Term, an
adjustment shall be made in computing the Basic Operating Cost for such year
so that Basic Operating Cost shall be computed as though the Building had been
one hundred percent (100%) occupied.

            (2)  "Estimated Basic Operating Cost" for any particular year
shall mean Landlord's estimate of the Basic Operating Cost for such fiscal
year as hereinafter provided.

            (3)  "Basic Operating Cost Adjustment" shall mean the difference
between Basic Operating Cost and Estimated Basic Operating Cost for any
calendar year determined as hereinafter provided.

            (4)  "Building" shall mean the Building described in the Basic
Lease Information, plus all land on which it is located or which is used in
connection with the Building.

         b.    Payment of Estimated Basic Operating Cost.  During the last
month of each fiscal year during the Term, or as soon thereafter as
practicable, Landlord shall give Tenant written notice of the Estimated Basic
Operating cost for the ensuing fiscal year.  The fiscal year is as specified
in the Basic Lease Information.  The Estimated Basic Operating Cost for the
fiscal year in which the Scheduled Term Commencement Date falls is set forth
in the Basic Lease Information sheet.  Tenant shall pay Tenant's Proportionate
Share of the Estimated Basic Operating Costs with installments of Basic Rent
required to be paid pursuant to Paragraph 3 above for the fiscal year to which
the estimate applies in monthly installments on the first day of each calendar
month during such year, in advance.  Such payment shall be construed to be
Rent for all purposes hereof.

         c.    Computation of Basic Operating Cost Adjustment.   After the end
of each fiscal year, Landlord shall deliver to Tenant a statement of Basic
Operating Cost for the fiscal year just ended, accompanied by a computation of
Basic Operating Cost Adjustment.  If such statement shows that Tenant's
payment based upon Estimated Basic Operating Costs is less than Tenant's
Proportionate Share of Basic Operating Cost, then Tenant shall pay the
difference within twenty (20) days after receipt of such statement, such
payment to constitute additional rent hereunder.  If such statement shows that
Tenant's payments of Estimated Basic Operating Cost exceed Tenant's
Proportionate Share of Basic Operating Costs, then (provided that Tenant is
not in default under this Lease) Tenant shall receive a credit for the amount
of such payment against Tenant's obligation for payment of Tenant's
Proportionate Share of Estimated Basic Operating Cost next becoming due
hereunder.  If this Lease has been terminated or the Term hereof has expired
prior to the date of such statement, then the Basic Operating Cost Adjustment
shall be paid by the appropriate party within twenty (20) days after the date
of delivery of the statement.

         d.    Net Lease.  This shall be a net lease and Base Rent shall be
paid to Landlord absolutely net of all costs and expenses.  The provisions for
payment of Basic Operating Cost by means of periodic payments of Tenant's
Proportionate Share of estimated Basic Operating Cost and the Basic Operating
Cost Adjustment are intended to pass on to Tenant and reimburse Landlord for
all cost and expenses of the nature described in Paragraph 27 a.(1) above
incurred in connection with operation of the Building.


    28.  Taxes Payable by Tenant.  Tenant shall pay before delinquency all
taxes levied or assessed during the term of this Lease (excluding, however,
state and federal personal or corporate income taxes measured by the income of
Landlord from all sources, capital stock taxes, and estate and inheritance
taxes), whether by or otherwise calculated with respect to: (a) the gross or
net payable under this Lease including, without limitation, any gross receipts
tax levied by any taxing authority, or any other gross income tax or excise
tax levied by any taxing authority with respect to the receipt of the rental
hereunder; (b) the value of Tenant's equipment, furniture, fixtures, or other
personal property located in the Premises; or (c) the value of any leasehold
improvements, alterations or additions made in or to the Premises, regardless
of whether title to such improvements, alterations, or additions shall be in
Tenant or Landlord.

    29.  Abandonment.  Tenant shall not vacate or abandon the Premises at any
time during the term, and any such vacation or abandonment shall be a breach
of this Lease.  If Tenant shall abandon, vacate, or surrender said Premises or
be dispossessed by process of law, or otherwise, any personal property
belonging to Tenant and left on the Premises shall, at the option of Landlord,
be deemed to be abandoned and title thereto shall pass to Landlord.

    30.  Successors and Assigns.  Subject to the provisions of Paragraph 9
hereof, the terms, covenants, and conditions contained herein shall be binding
upon and inure to the benefit of the heirs, successors, executors,
administrators, and assigns of the parties hereto.

    31.  Attorneys' Fees.  In the event that any action must be taken to
enforce any term, covenant, or condition of this Lease, Landlord shall be
entitled to payment by Tenant of all reasonable costs incurred in connection
with such enforcement, whether or not litigation is commenced including,
without limitation, reasonable attorneys' fees.

    32.  Lease Consideration.  Upon occupancy in the Premises, Tenant has paid
the sum of $6,500.00 as lease consideration.  Landlord may apply the lease
consideration to pay the cost of performing any obligation which Tenant fails
to perform within the time required by this Lease, but such application by
Landlord shall not be the exclusive remedy for Tenant's default.  If the lease
consideration is applied by Landlord, Tenant shall on demand pay the sum
necessary to replenish the lease consideration to its original amount.

    33.  [Intentionally Deleted]

    34.  Corporate Authority.  If Tenant signs as a corporation, each of the
persons executing this Lease on behalf of Tenant does hereby covenant and
warrant that Tenant is a duly authorized and existing corporation, that Tenant
has and is qualified to do business in Utah, that the corporation has full
right and authority to enter into this Lease, and that each and both of the
persons signing on behalf of the corporation were authorized to do so.  Upon
Landlord's request, Tenant shall provide Landlord with evidence reasonably
satisfactory to Landlord confirming the foregoing covenants and warranties.

    35.  Lease Effective Date.  Submission of this instrument for examination
or signature by Tenant does not constitute a reservation of or option for
lease, and it is not effective as a lease or otherwise until execution and
delivery by both Landlord and Tenant.

    36.  Brokerage.  Tenant represents and warrants that it has dealt with no
broker, agent or other person in connection with this transaction and/or that
no broker, agent or other person brought about this transaction. Tenant agrees
to indemnify and hold Landlord harmless from and against any claims by any
other broker, agent or other person claiming a commission or other form of
compensation by virtue of having dealt with Tenant with regard to this leasing
transaction.

    37.  Force Majeure.  Except in the case of the payment of Rent by Tenant,
whenever a period of time is herein prescribed for action to be taken by
Landlord or Tenant, Landlord or Tenant as the case may be shall not be liable
or responsible for, and there shall be excluded from the computation for any
such period of time, any delays due to strikes, riots, Acts of God, shortages
of labor or materials, war, governmental laws, regulations or restrictions or
any other causes of any kind whatsoever which are beyond the control of
Landlord or Tenant as the case may be.

    38.  Certain Rights Reserved by Landlord.  Landlord shall have the
following rights, exercisable without notice and without liability to Tenant
for damage or injury to property, persons or business and without effecting an
eviction, constructive or actual, or disturbance of Tenant's use or possession
or giving rise to any claim for setoff or abatement of rent:

         a.    To decorate and make repairs, alterations, or improvements,
whether structural or otherwise, in and about the Building, and to change the
arrangement and location of entrances, doors, corridors, elevators, stairs,
toilets, or other public parts of the Building, without affecting any of
Tenant's obligations hereunder, so long as the leased Premises are reasonably
accessible.

         b.    To have and retain a paramount title to the leased Premises
free and clear of any act of Tenant purporting to burden the encumber them.

         c.    To change the name of which the Building is designated.

         d.    To grant to anyone the exclusive right to conduct any business
or render any service in or to the Building, provided such exclusive right
shall not operate to exclude Tenant from the use expressly permitted herein.

         e.    [Intentionally Deleted]

         f.    To have access for Landlord and other tenants of the Building
to any mail chutes located on the leased Premises according to the rules of
the United States Postal Service.

         g.    To take all such reasonable measures as Landlord may deem
advisable for the security of the Building and its occupants including,
without limitation, the search of all persons entering or leaving the
Building, the evacuation of the Building for cause, suspected cause, or for
drill purposes, the temporary denial of access to the Building, and the
closing of the Building after normal business hours and on Saturdays, Sundays,
and holidays subject, however, to Tenant's right to admittance when the
Building is closed after normal business hours under such reasonable
regulations as Landlord may prescribe from time to time.

    39.  [Intentionally Deleted]

    40.  Miscellaneous.

         a.    The term "Premises" wherever it appears herein includes and
shall be deemed or taken to include the office space demised and improvements
now or at any time hereinafter comprising or built in the space hereby
demised.  The term "Landlord" shall include the Landlord, its successors, and
assigns.  In any case where this Lease is signed by more than one person, the
obligations hereunder shall be joint and several.  The term "Tenant" or any
pronoun used in place thereof shall indicated and include the masculine or
feminine, the singular or plural number, individuals, firms or corporations,
and their and each of their respective successors, executors, administrators,
and permitted assigns, according to the context hereof.

         b.    Time is of the essence of this Lease and all its provisions.
This Lease, in all respects, shall be governed by the laws of the state of
Utah.  The Lease, together with its exhibits, contains all the agreements of
the parties hereto and supersedes any previous negotiations.  There have been
no representations made by the Landlord or understandings made between the
parties other than those set forth in this Lease and its exhibits.  This Lease
may not be modified except by a written instrument by the parties hereto.

         c.    If, for any reason whatsoever, any of the provisions hereof
shall be unenforceable or ineffective, all of the other provisions shall be
and remain in full force and effect.

         d.    Exhibits attached hereto are hereby incorporated into this
Lease.

        IN WITNESS WHEREOF, the parties hereto have executed this Lease the
day and year first above written.

LANDLORD:                             TENANT:

 F.G.B.P. L.L.C.        [initials]    FLEXPOINT SENSOR SYSTEMS, INC.



    /s/ Alan Wheatley                      /s/ John Sindt, President
By:_____________________________      By:_____________________________
    Alan Wheatley                          John Sindt

    /s/ Gary Deaton
By:_____________________________      By:_____________________________
    Gary Deaton

    /s/ Don Watkins
By:_____________________________
    Don Watkins                                    9/13/04

    /s/ David Blake
By:_____________________________
    David Blake