EMPLOYMENT AGREEMENT


                THIS  EMPLOYMENT  AGREEMENT (the  "Agreement"),  effective as of
June 1, 1998, is entered into by and between William J. Hemelt (the  "Employee")
and Gum Tech International, Inc. (the "Company").

                The Company  desires to  establish  its right to the services of
the Employee, in the capacity described below, on the terms and conditions,  and
subject to the rights of termination  hereinafter set forth, and the Employee is
willing to accept such employment on such terms and conditions.

                In consideration of the mutual agreements hereinafter set forth,
the Employee and the Company have agreed and do hereby agree as follows:

                1.  EMPLOYMENT AS CHIEF  FINANCIAL  OFFICER OF THE COMPANY.  The
Company  does hereby  employ,  engage and hire the  Employee as Chief  Financial
Officer of the Company  and the  Employee  does hereby  accept and agree to such
hiring, engagement and employment.  Employee agrees to perform any and all other
duties and to assume any and all  responsibilities  that may be  assigned to him
from time to time by the President of the Company.  The Employee will devote his
full time, energy and skill to the performance of his duties for the Company and
for the  benefit of the  Company,  vacations  pursuant  to Section 4 below,  and
reasonable absences because of illness excepted.  Furthermore, the Employee will
exercise due diligence and care in the  performance of his duties of the Company
under this Agreement.

                2. EMPLOYMENT PERIOD.

                (a) INITIAL TERM.  The Employee shall be employed by the Company
for the duties as set forth in Section 1 for the two-year period,  commencing on
June 1, 1998 and ending on May 31,  2000 (the  "Initial  Term"),  unless  sooner
terminated in accordance with the provisions of this Employment Agreement.

                (b)  RENEWAL;   EMPLOYMENT   PERIOD  DEFINED.   This  Employment
Agreement  will be  automatically  renewed  at the end of the  Initial  Term for
additional  one-year  periods  commencing  on each June 1 and ending on the next
following May 31(a "Renewal Term"),  unless either party serves notice of desire
to terminate or modify this Employment  Agreement  ("Notice of  Non-Renewal") on
the other.  Employee  must give Notice of  Non-Renewal  at least sixty (60) days
before the end of the Initial Term or the applicable  Renewal Term.  Unless this
Agreement is terminated by the Company for "cause" pursuant to Section 7(a), the
Company must give Notice of  Non-Renewal  at least six (6) months before the end
of the Initial Term or sixty (60) days before the end of any applicable  Renewal
Term. If the Company fails to give timely a Notice of  Non-Renewal  prior to the
end of the Initial Term, the Company shall pay to Employee a penalty. The amount
of such penalty shall be determined in accordance  with Section 2(c). The period
of time  commencing as of June 1, 1998,  and ending on the effective date of the
termination of employment

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of the Employee  under this or any successor  agreement  shall be referred to as
the "Employment Period".

                (c)  PENALTY  FOR COMPANY  FAILURE TO PROVIDE  TIMELY  NOTICE OF
NON-RENEWAL.  If the Company fails to give  Employee  Notice of  Non-Renewal  at
least six (6) months  before the end of the Initial  Term as required by Section
2(b),  Company will pay a penalty to Employee in an amount  equal to  Employee's
base salary,  as determined  pursuant to Section 3,  multiplied  by  one-twelfth
(1/12),  and then multiplied by the difference between six (6) and the length of
the  notice  (measured  in full and  fractional  months)  actually  given by the
Company.  The  penalty  payable  pursuant  to this  paragraph  shall be  payable
commencing after the Employment Period in equal semi-monthly  installments (paid
at the same time as the  Company's  semi-monthly  payroll)  at the rate at which
Employee'  base salary was being paid on the last day of the  Employment  Period
until such time as the penalty has been paid in full.  To the extent  necessary,
the last installment payment shall be prorated.

                (d) NINETY (90) DAY FREE LOOK PERIOD.  Notwithstanding any other
provision of this Agreement to the contrary, either party may, during the period
commencing  on June 1,  1998 and  ending  on  August  30,  1998  terminate  this
Agreement for any reason  whatsoever by providing ten (10) days advance  written
notice of termination to the other party. If Employee's employment is terminated
during this ninety (90) day free look period, the provisions of Sections 7 and 8
shall not apply. The Company's obligation to pay base salary pursuant to Section
3 shall end as of the date Employee's employment is terminated.

                3. COMPENSATION

                (a) BASE SALARY.  The Company  shall pay the  Employee,  and the
Employee agrees to accept from the Company, in full payment for his services and
promises to the Company  (specifically  including the Covenant Not to Compete as
set  forth in  Section  10) a base  salary at the rate of One  Hundred  Thousand
Dollars ($100,000.00) per year, payable in equal semi-monthly installments or at
such other time or times as the Employee and the Company shall agree.  This base
salary may be renegotiated if this Employment  Agreement is renewed  pursuant to
Section 2, or from time to time by mutual agreement of the parties.

                (b)  BONUS.  Employee  also  may  receive  an  annual  bonus  in
accordance  with the  Company's  Comprehensive  Employee  Bonus Plan (the "Bonus
Plan") the terms of which will be  decided  at a later  date.  The amount of the
bonus,  if any,  payable to Employee  shall be calculated and paid in accordance
with the provisions of the Company's Bonus Plan.

                (c) OPTIONS. A separate option agreement will be entered into by
the parties  pursuant to which an option to purchase 50,000 shares of stock will
be granted to Employee as of June 1, 1998.

                4. FRINGE  BENEFITS AND VACATION.  Employee shall be entitled to
participate in any benefit programs adopted from time to time by the Company for
the benefit of its

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employees  and  Employee  shall  receive  such other  fringe  benefits as may be
granted to him from time to time by the Company's  Board of Directors.  Employee
is entitled to four (4) weeks of paid  vacation  per  calendar  year,  with such
vacation to be scheduled  and taken in accordance  with the  Company's  standard
vacation policies.

                5. BUSINESS  EXPENSES.  The Company will  reimburse the Employee
for any and all necessary,  customary, and usual expenses, properly receipted in
accordance with Company policies, incurred by Employee on behalf of the Company.

                6. TERMINATION OF EMPLOYMENT UPON DEATH OR DISABILITY.

                (a) DEATH.  If the Employee dies while  employed by the Company,
the Employee's employment shall automatically cease and terminate. The Company's
obligation to pay the Employee's  base salary pursuant to Section 3 shall end as
of the date of Employee's death.

                (b) DISABILITY. If Employee is absent from work due to injury or
illness,  the Employee  will receive sick pay in  accordance  with the Company's
established  policy concerning sick pay.  Following the expiration of any period
of sick pay to which Employee may be entitled, Employee will be placed on unpaid
leave of absence in accordance with the Company's  leave of absence  policy.  If
Employee is ultimately determined to be disabled (as defined below),  Employee's
leave of  absence  shall  cease on the date  such  determination  is  effective.
Otherwise,  Employee's leave of absence may be terminated by the Company, in its
discretion, as long as such termination does not violate applicable federal law.

                (c) DEFINITION OF DISABLED.  The Employee shall be considered to
be  "disabled"  for purposes of this Section 6 if, in the judgment of a licensed
physician  selected by the Board of Directors  of the  Company,  the Employee is
unable to perform  the  material  duties of his  position  under this  Agreement
because of a physical or mental impairment.  The determination by said physician
shall be binding and conclusive for all purposes.

                7. TERMINATION BY THE COMPANY.

                (a)  TERMINATION  FOR CAUSE.  The  Company  may  terminate  this
Agreement  at any time before the last day of the Initial Term (May 31, 2000) or
before  the last day of any  Renewal  Term if this  Agreement  is renewed on the
mutual  agreement  of the  parties,  only for  "cause." The term "cause" as used
herein shall mean:

                         (1)  Conduct  of a  criminal  nature  which may have an
                adverse  impact on the Company's  reputation and standing in the
                community;

                         (2) Conduct which is in violation of Employee's  common
                law duty of loyalty to the Company;

                         (3) Fraudulent  conduct in connection with the business
                affairs of the

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                Company,  regardless  of whether  said  conduct is  designed  to
                defraud the Company or others; or

                         (4) The failure of the Employee to discharge or perform
                his  duties  and  obligations  under  this  Agreement  with  due
                diligence and care;

                         (5) The refusal of the  Employee to implement or adhere
                to specific and duly-adopted policies or directives of the Board
                of Directors of the Company;

                         (6) Conduct  which is in violation of any  provision of
                this Agreement.

The  existence  of  cause  shall  be  conclusively  determined  by the  Board of
Directors of the Company or its duly appointed  agent. If Employee's  employment
is terminated for any of the reasons specified in subparagraphs (1), (2) or (3),
Employee's employment may be terminated  immediately without any advance written
notice. If Employee's  employment is terminated for any of the reasons stated in
subparagraphs (4), (5) or (6), Employee shall be entitled to receive thirty (30)
days  advance  written  notice  of the  termination  and  the  reasons  for  the
termination  and shall be given a  reasonable  opportunity  to  respond  thereto
(provided that this shall not require that his employment or pay be extended).

                (b)  NORMAL   TERMINATION.   This  Employment   Agreement  shall
terminate  as of May 31,  2000,  or as of the last day of any Renewal  Term,  if
either party gives notice of intention to terminate or modify in accordance with
the provisions of Section 2.

                (c) FINAL COMPENSATION PAYMENTS. The Company's obligation to pay
the Employee's  base salary pursuant to Section 3 shall terminate as of the last
day of the  Initial  Term (May 31,  2000),  or as of the last day of any Renewal
Term if this  Employment  Agreement is continued by the mutual  agreement of the
parties,  or on the day properly  specified in any notice of termination  issued
pursuant to any of the preceding paragraphs of this Section.  Employee shall not
be entitled to receive any bonus  pursuant to Section 3(b) for the year in which
his  employment  is  terminated  if his  employment  is  terminated  for "cause"
pursuant to Section 7(a). In all other cases in which  Employee's  employment is
terminated by the Company pursuant to this Section, any non-discretionary  bonus
due to the Employee pursuant to the Company's Bonus Plan shall be prorated based
on the number of months or  fractions  thereof  worked by Employee  prior to the
termination.  "Non-discretionary  bonus" means a bonus that, under the Company's
Bonus Plan, is not  determined or awarded at the discretion of management or the
board, but is granted pursuant to a structured schedule.

                8. TERMINATION BY THE EMPLOYEE.

                (a)  CHANGE  OF  CONTROL.   The  Employee  may  terminate   this
Employment  agreement  in the event of a "change in control of the  Company" (as
defined below). If a change in control of the Company occurs, Employee may elect
within thirty (30) days of such change in control to terminate  this  Employment
Agreement  and will have the right to  receive  a payment  equal to the

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present value of the remaining  base salary  payments due through the end of the
Initial  Term  of  this  employment  Agreement  plus a  prorated  amount  of any
non-discretionary  bonus (as defined in Section  7(c)  above) to which  Employee
would  otherwise  entitled  under the  Company's  Bonus  Plan.  If the change in
control  occurs during a Renewal Term,  Employee shall receive the present value
of remaining  payments due through the end of such Renewal  Term.  Present value
shall be  calculated  using an interest  rate equal to the  "applicable  Federal
rate," as such term is defined in Section  1274(d)(1)  of the  Internal  Revenue
Code of 1986, determined as of the day on which the calculation is being made. A
"change  in  control  of the  Company,"  for the  purposes  of  this  Employment
Agreement, shall mean:

                (1) a transfer of fifty-one percent (51%) or more of the capital
stock of the Company during any calendar year;

                (2) a transfer of fifty-one percent (51%) or more of the capital
stock of the Company,  in the  aggregate,  during any period of five (5) or more
consecutive calendar years; or

                (3) a change in the  composition  of the Board of Directors such
that during any period of two (2) consecutive  calendar years during the term of
this  Agreement,  fifty-one  percent (51%) or more of the individuals who at the
beginning of such period  constitute  the Board cease for any reason to serve on
the Board of Directors.

                9. EFFECT OF  TERMINATION.  Upon the proper  termination of this
Employment  Agreement  by the  Company  for any reason  whatsoever,  or upon the
termination  of this  Employment  Agreement  by the  Employee,  this  Employment
Agreement  shall thereupon be and become void and of no further force or effect,
except that the Covenant Not to Compete set forth in Section 10 the  Proprietary
Information  provisions  of Section 11 shall  survive any said  termination  and
shall  continue to bind the Employee  for the period of time stated  therein and
the  Arbitration  provisions of Section 17 shall continue to govern any disputes
arising  hereunder.  Any  payments  due  pursuant  to  the  provisions  of  this
Employment  Agreement for services  rendered prior to the  termination  shall be
made as provided in this Employment Agreement.

                10. COVENANT NOT TO COMPETE.  The Employee  acknowledges that he
is the Chief Financial  Officer of the Company and in such capacity the Employee
will be the Company's  representative  with the clients and potential clients of
the  Company.  The  Employee  also  acknowledges  that he will  have  access  to
confidential information about the Company and its clients and that he will have
access to other "proprietary information" (as defined in Section 11) acquired by
the Company at the expense of the Company for use in its business.  Employee has
substantial experience in financial matters, and possesses special,  unique, and
extraordinary skills and knowledge in this field. The Employee's  management and
operational  services to the Company are special,  unique, and extraordinary and
the success or failure of the Company in  developing,  manufacturing,  marketing
and  distributing  functional  chewing  gum is  dependent  upon  the  Employee's
discharge  of his duties and  obligations.  Accordingly,  by  execution  of this
employment Agreement:

                (a)  DURATION  OF  COVENANT.  Employee  agrees  that  during the
Employment

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Period and for a period of one (1) year following the Employee's  termination of
employment  for any reason  (whether  such  termination  shall be  voluntary  or
involuntary),  the Employee  shall not violate the  provisions of Paragraph (b),
below.  Employee  agrees that the one-year  period  referred to in the preceding
sentence  shall be extended by the number of days included in any period of time
during which the Employee is or was engaged in activities  constituting a breach
of Paragraph (b).

                (b) PROHIBITED  COMPETITIVE  ACTIVITIES.  During the time period
specified in Paragraph (a), Employee shall not:

                         (1)  Directly  or  indirectly  own,  operate,   manage,
                consult with, control,  participate in the management or control
                of, be employed by, maintain, or control any interest whatsoever
                in  any  entity   engaged  in  the   business   of   developing,
                manufacturing,  marketing or distributing functional chewing gum
                to  wholesalers  or  distributors  or in retail or private label
                markets in Maricopa County, State of Arizona; or

                         (2) Directly or  indirectly  solicit any business  from
                any  individual or entity which  obtained such services from the
                Company at any time during the Employee's Employment Period; or

                         (3) Directly or  indirectly  solicit any business  from
                any individual or entity  solicited by the Employee on behalf of
                the Company; or

                         (4) Directly or  indirectly  seek to hire,  and/or hire
                any of  Company's  employees  for the  purpose  of  having  such
                employee  engage  in  services  that are the  same,  similar  or
                related to the services that such employee provided for Company.

                (c) NEED FOR COVENANT,  LEGAL REMEDIES.  The Employee expresses,
agrees and  acknowledges  that this Covenant Not to Compete is necessary for the
Company's  protection  because of the nature and scope of the Company's business
and the  Employee's  position  with and services for the Company.  Further,  the
Employee  acknowledges  that, in the event of his breach of this Covenant Not to
Compete,  money  damages will not  sufficiently  compensate  the Company for its
injury caused thereby,  and the Employee  accordingly agrees that in addition to
such  money  damages  the  Employee  may be  restrained  and  enjoined  from any
continuing  breach of this  Covenant  Not to Compete  without  any bond or other
security being required by any court. The Employee  acknowledges that any breach
of this  Covenant  Not to  Compete  would  result in  irreparable  damage to the
Company.

                (d)  ACKNOWLEDGMENTS BY EMPLOYEE.  The Employee expressly agrees
and acknowledges as follows:

                       (1) This Covenant Not to Compete is reasonable as to time
                and geographical area and does not place any unreasonable burden
                upon him.

                       (2) The general  public will not be harmed as a result of
                enforcement of this Covenant Not to Compete.

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                       (3) Employee has requested or has had the  opportunity to
                request that his personal legal counsel review this Covenant Not
                to Compete.

                       (4) The Employee  understands  and hereby  agrees to each
                and every term and condition of this Covenant Not to Compete.

                11. PROPRIETARY INFORMATION

                (a) RETURN OF PROPRIETARY INFORMATION.  Upon termination of this
Agreement  for any  reason,  the  Employee  shall  immediately  turn over to the
Company any "Proprietary Information," as defined below. The Employee shall have
no  right to  retain  any  copies  of any  material  qualifying  as  Proprietary
Information  for any  reason  whatsoever  after  termination  of his  employment
hereunder without the express written consent of the Company.

                (b) NON  DISCLOSURE.  It is  understood  and agreed that, in the
course of his employment  hereunder and through his activities for and on behalf
of the Company,  the  Employee  will  receive,  deal with and have access to the
Company's  Proprietary  Information  and that the Employee  holds the  Company's
Proprietary  Information in trust and  confidence for the Company.  The Employee
agrees that he shall not,  during the term of this Agreement or  thereafter,  in
any fashion,  form or manner,  directly or indirectly,  retain,  make copies of,
divulge, disclose or communicate to any person, in any manner whatsoever (except
when  necessary or required in the normal  course of the  Employee's  employment
hereunder and for the benefit of the Company or with the express written consent
of the  Company,  or as  required  by  law)  any of  the  Company's  Proprietary
Information  or any  information of any kind,  nature or description  whatsoever
concerning any matters affecting or relating to the Company's business.

                (c)  PROPRIETARY  INFORMATION  DEFINED.  For  purposes  of  this
Agreement,  "Proprietary  Information"  means and  includes the  following:  the
identity  of clients or  customers  or  potential  clients or  customers  of the
Company; any written,  typed or printed lists or other materials identifying the
clients or customers of the Company; any financial or other information supplied
by  clients  or  customers  of the  Company;  any  and all  data or  information
involving the techniques,  programs, methods or contacts employed by the Company
in the conduct of its business; any lists, documents,  manuals,  records, forms,
or other  materials  used by the  Company in the  conduct of its  business;  any
descriptive  materials  describing  the methods and  procedures  employed by the
Company in the conduct of its  business;  and any other  secret or  confidential
information  concerning  the  Company's  business or affairs.  The term  "list",
"document",  or their equivalent,  as used in this Section, are not limited to a
physical  writing  or  compilation  but  also  include  any and all  information
whatsoever  regarding the subject matter of the "list" or "document"  whether or
not such compilation has been reduced to writing.

                12. TERMINATION OF PRIOR AGREEMENTS.  This Agreement  terminates
and  supersedes  any and all prior  agreements  and  understandings  between the
parties with respect to

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employment or with respect to the compensation of the Employee by the Company.

                13.  ASSIGNMENT.  This  Agreement  is personal in its nature and
neither of the parties hereto shall, without the consent of the other, assign or
transfer this Agreement or any rights or obligations  hereunder;  provided that,
in the  event  of the  merger,  consolidation  or  transfer  or  sale  of all or
substantially  all of the assets of the Company with or to any other  individual
or entity,  this Agreement shall,  subject to the provisions  hereof, be binding
upon and  inure to the  benefit  of such  successor  and  such  successor  shall
discharge and perform all the promises, covenants, duties and obligations of the
Company hereunder.

                14.  GOVERNING LAW. This Agreement and the legal  relations thus
created  between the parties hereto shall be governed by and construed under and
in accordance with the laws of the State of Arizona.

                15. ENTIRE  AGREEMENT.  This Employment  Agreement  embodies the
entire agreement of the parties  respecting the matters within its scope and may
be modified only in writing.

                16. WAIVER. Failure to insist upon strict compliance with any of
the terms,  covenants or conditions  hereof shall not be deemed a waiver of such
term,  covenant  or  condition,  nor shall any waiver or  relinquishment  of, or
failure to insist upon strict  compliance  with, any right or power hereunder at
any one or more  times be deemed a waiver  or  relinquishment  of such  right or
power at any other time or times.

                17. ARBITRATION. In the event any dispute or controversy arising
out of this Agreement (other than claims arising pursuant to the Covenant Not to
Compete or Proprietary  Information  provisions of Sections 10 and 11) cannot be
settled by Company and Employee, such controversy or dispute, at the election of
either Company or Employee,  by written notice to the other, may be submitted to
arbitration in Phoenix,  Arizona, and for this purpose Company and Employee each
hereby  expressly  consent  to such  arbitration  and such  place.  In the event
Company and Employee cannot,  within fifteen (15) days following the election to
submit  the  dispute  or  controversy  to  arbitration,  mutually  agree upon an
arbitrator  to settle their  dispute or  controversy,  then Company and Employee
shall each select one (1)  arbitrator  and the two  arbitrators  shall  select a
third  arbitrator.  The  decision of the majority of said  arbitrators  shall be
binding upon Company and Employee for all purposes,  and judgment to enforce any
such binding  decision may be entered in the Superior Court,  Maricopa  Country,
Arizona (and for this purpose Company and Employee hereby irrevocably consent to
the  jurisdiction of said court).  If either Company or Employee fails to select
an arbitrator within fifteen (15) days after written demand from the other party
to do so,  then the  Chief  Judge in the  United  States  District  Court of the
District of Arizona  shall  select  such other  arbitrator.  At the  election of
either Company or Employee,  all arbitrators  shall be selected  pursuant to the
then existing  rules and  regulations  of the American  Arbitration  Association
governing commercial transactions. At the request of either Company or Employee,
arbitration  proceedings shall be conducted in the utmost secrecy. In such case,
all documents,  testimony and records shall be available for inspection only for
purposes  of the  arbitration  and only by either  party  and  their  respective
attorneys and experts who shall agree, in advance and in writing, to receive all
such  information  in secrecy.  In all other

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<PAGE>
respects,  the arbitrators shall conduct all proceedings pursuant to the Uniform
Arbitration  Act as adopted by the State of Arizona and the then existing  rules
and regulations of the American  Arbitration  Association  governing  commercial
transactions. The costs of the arbitration and arbitrators shall be borne by the
non-prevailing  party,  as determined by the  arbitrators,  and each party shall
bear their own attorneys' fees.

                18.  SEVERABILITY.  In the  event  that  a  court  of  competent
jurisdiction  determines  that any portion of this  Agreement is in violation of
any statute or public  policy,  then only the portions of this  Agreement  which
violate  such statute or public  policy shall be stricken.  All portions of this
Agreement  which do not violate any statute or public  policy shall  continue in
full force and effect.  Further,  any court order  striking  any portion of this
Agreement  shall modify the stricken terms to give as much effect as possible to
the intentions of the parties under this Agreement.

                IN WITNESS WHEREOF,  the Company has caused this Agreement to be
executed by its duly  authorized  officer,  and the Employee has hereunto signed
this Agreement, on this day of ______________, 1998.

                                        GUM TECH INTERNATIONAL, INC.


                                        By:_____________________________________

                                          Its:__________________________________


                                        WILLIAM J. HEMELT

                                        ________________________________________

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                 Gum Tech International, Inc. Stock Option Plan

                         Grant of Incentive Stock Option

Date of Grant: June 1, 1998

         THIS GRANT, dated as of the date of grant first stated above (the "Date
of Grant"),  is delivered by Gum Tech  International,  Inc., a Utah  corporation
("Company") to William J. Hemelt (the "Grantee"), who is an employee, officer or
director of Company.

         WHEREAS,  the Board of  Directors of Company  (the  "Board")  effective
March 1, 1995, adopted the Gum Tech  International,  Inc., Stock Option Plan, as
amended (the "Plan");

         WHEREAS,  the Plan  provides  for the  granting  of stock  options by a
committee to be appointed by the Board (the "Committee") to directors,  officers
and key  employees of Company to purchase,  or to exercise  certain  rights with
respect to,  shares of the Common Stock of Company,  no par value per share (the
"Stock"), in accordance with the terms and provisions thereof; and

         WHEREAS,  the  Committee  considers  the  Grantee to be a person who is
eligible for a grant of stock options under the Plan, and has determined that it
would be in the best interest of Company to grant the stock  options  documented
herein.

         NOW,  THEREFORE,  the parties  hereto,  intending  to be legally  bound
hereby, agree as follows:

SECTION 1.        GRANT OF OPTION

         Subject to the terms and  conditions  hereinafter  set forth,  Company,
with the approval and at the  direction of the  Committee,  hereby grants to the
Grantee,  as of the Date of Grant,  an option to purchase up to 50,000 shares of
Stock at a price equal to $5.50 per share,  the fair market value of such shares
as of the Date of Grant. Such option is hereinafter  referred to as the "Option"
and the shares of stock  purchasable upon exercise of the Option are hereinafter
sometimes referred to as the "Option Shares."

SECTION 2.        VESTING

         Subject to the  limitations  set forth in  Section 3, the Option  shall
become  exercisable in accordance with the vesting  schedule set forth below, so
long as the Grantee is actively employed by the Company on such date:

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   PERCENTAGE OF OPTION SHARES EXERCISABLE        DATE OPTION SHARES VEST
   ---------------------------------------        -----------------------

                  First 50%                            June 1, 1999
                  Second 50%                           June 1, 2000

         Notwithstanding the foregoing, in the event of a Change of Control, all
then  unvested  Options  shall  become fully  vested and  exercisable.  For this
purpose, a "Change of Control" shall mean any of the following:

          (1) a transfer of fifty-one percent (51%) or more of the capital stock
of the Company during any calendar year;

          (2) a transfer of fifty-one percent (51%) or more of the capital stock
of the  Company,  in the  aggregate,  during  any  period  of  five  (5) or more
consecutive calendar years; or

         (3) a change in the  composition  of the Board of  Directors  such that
during any period of two (2) consecutive  calendar years during the term of this
Agreement,  fifty-one  percent  (51%)  or  more  of the  individuals  who at the
beginning of such period  constitute  the Board cease for any reason to serve on
the Board of Directors.

SECTION 3.        TERMINATION OF OPTION

         3.1 The Option and all rights  hereunder with respect  thereto,  to the
extent such rights shall not have been  exercised,  shall  terminate  and become
null and void on June 1, 2001 (the "Option Term").

         3.2 In the event of the death or disability of the Grantee,  the Option
may be exercised by the Grantee or the Grantee's legal  representative(s) at any
time within the one year  anniversary  date of the Grantee's  death, but only to
the extent that the Option would otherwise have been exercisable by the Grantee.

         3.3  In the  event  of  that  Grantee  is no  longer  a key  management
employee, officer or director of the Company, the Option may be exercised by the
Grantee  or its legal  representative(s)  at any time  within 90 days  after the
Grantee  is no longer a key  management  employee,  officer or  director  if the
Option  Shares  are  subject  to an S-8  Registration  Statement  filed with the
Securities  Exchange  Commission and at any within one year after the Grantee is
no longer a key  management  employee,  officer or director if the Option Shares
are not  subject to an S-8  Registration  Statement  filed  with the  Securities
Exchange Commission.

         3.4  Notwithstanding  any other  provisions  set forth herein or in the
Plan, any unexercised  portion of the option shall immediately  terminate and be
void if the Grantee shall engage in any of the following:

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                  (1)  Conduct  of a criminal  nature  which may have an adverse
         impact on the Company's reputation and standing in the community;

                  (2) Conduct which is in violation of Grantee's common law duty
         of loyalty to the Company;

                  (3) Fraudulent conduct in connection with the business affairs
         of the  Company,  regardless  of whether  said  conduct is  designed to
         defraud the Company or others; or

                  (4) The  failure of the  Grantee to  discharge  or perform the
         duties of his position with due diligence and care;

                  (5) The  refusal  of the  Grantee  to  implement  or adhere to
         specific  and  duly-adopted  policies  or  directives  of the  Board of
         Directors of the Company;

                  (6) Conduct  which is in  violation  of any  provision  of any
         employment agreement,  noncompete agreement,  or any other agreement in
         effect between the Grantee and the Company.

SECTION 4.        EXERCISE OF OPTIONS

         4.1 The grantee may exercise the Option with respect to all or any part
of the  number  of Option  Shares  then  exercisable  hereunder  by  giving  the
President of the Company  written  notice of intent to  exercise.  The notice of
exercise  shall specify the number of Option Shares as to which the Option is to
be exercised and the date of exercise thereof, which date shall be at least five
days after the  giving of such  notice  unless an  earlier  time shall have been
mutually agreed upon.

         4.2 Full  payment (in U.S.  dollars) by the Grantee of the option price
for the Option  Shares  purchased  shall be made on or before the exercise  date
specified in the notice of exercise in cash, certified funds or cashier's check,
or, with the prior written consent of the Committee, in whole or in part through
the surrender of previously  acquired shares of Stock at their fair market value
on the exercise date.

                  No shares of Stock  shall be  delivered  upon  exercise of the
Option  until  (i) the  purchase  price  is paid  in full in the  manner  herein
provided or (ii) the Company receives any approval of any governmental authority
required  in  connection  with the Option,  or the  issuance of Stock under this
Agreement.  The Company is not required to deliver any shares of Stock  pursuant
to the exercise of the Option if, in the opinion of counsel for the Company, the
issuance  would  violate  the  Securities  Act of 1933 or any  other  applicable
federal or state securities laws or regulations.

         4.3 If the Grantee fails to pay for any of the Option Shares  specified
in such  notice or fails to accept  delivery  thereof,  the  Grantee's  right to
purchase such Option Shares may be terminated by Company.  The date specified in
the  Grantee's  notice  as the  date of  exercise  shall be  deemed  the date of
exercise of the Option,  provided  that payment in full for the Option Shares to
be purchased upon such exercise shall have been received by such date.

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SECTION 5.        ADJUSTMENT OF AND CHANGES IN STOCK OF COMPANY

         In the event of a reorganization,  recapitalization,  change of shares,
stock  split,  spin-off,  stock  dividend,   reclassification,   subdivision  or
combination  of shares,  merger,  consolidation  rights  offering,  or any other
change in the  corporate  structure or shares of capital  stock of Company,  the
Committee shall make such  adjustment as it deems  appropriate in the number and
kind of shares of Stock subject to the Option or in the option price:  provided,
however,  that no such  adjustment  shall give the  Grantee  any  additional  or
reduced benefits under the Option.

SECTION 6.        FAIR MARKET VALUE

         As used herein,  the fair market value of a share of Stock shall be the
closing price of the Stock on the date of the granting of this option.

SECTION 7.        NO RIGHTS OF STOCKHOLDERS

         Neither the Grantee nor any personal  representative shall be, or shall
have any of the rights and  privileges or, a stockholder of Company with respect
to any shares of Stock  purchasable or issuable upon the exercise of the Option,
in whole or in part, prior to the date of exercise of the Option.

SECTION 8.        NON-TRANSFERABILITY OF OPTION

         During  the  Grantee's   lifetime,   the  Option   hereunder  shall  be
exercisable  only  by the  Grantee  or any  personal  representative,  guardian,
conservator or legal  representative  of the Grantee and the Option shall not be
transferable except, in case of the death of the Grantee, by will or the laws of
descent  and  distribution,  nor shall  the  Option be  subject  to  attachment,
execution  or other  similar  process.  In the event of (a) any  attempt  by the
Grantee to alienate,  assign,  pledge,  hypothecate or otherwise  dispose of the
Option,  except  as  provided  for  herein,  or (b) the levy of any  attachment,
execution  or similar  process  upon the rights or  interest  hereby  conferred,
Company may terminate the Option by notice to the Grantee and it shall thereupon
become null and void.

SECTION 9.        EMPLOYMENT NOT AFFECTED

         The granting of the Option nor its  exercise  shall not be construed as
granting to the  Grantee,  if he is an employee of the  Company,  any right with
respect to continuance of employment of the Company.  Except as may otherwise be
limited by a written agreement between the Company and the Grantee, the right of
the Company to terminate at will the  Grantee's  employment  with it at any time
(whether by dismissal,  discharge,  retirement  or  otherwise)  is  specifically
reserved by Company,  as the Company or on behalf of the Company  (whichever the
case may be), and acknowledged by the Grantee.

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SECTION 10.       AMENDMENT OF OPTION

         The Option may be amended by the Board or the Committee at any time (i)
if the Board or the Committee determines, in its sole discretion, that amendment
is  necessary  or  advisable  in the light of any  addition  to or change in the
Internal Revenue Code of 1986 or in the regulations  issued  thereunder,  or any
federal or state securities law or other law or regulation,  which change occurs
after the Date of Grant and by its terms  applies to the  Option,  or (ii) other
than in the  circumstances  described  in clause  (i),  with the  consent of the
Grantee.

SECTION 11.       NOTICE

         Any  notice  to  Company  provided  for in  this  instrument  shall  be
addressed to it in care of its  Secretary  at the  following  address:  Gum Tech
International,  Inc., 246 East Watkins Street,  Phoenix,  Arizona 85004, and any
notice to the Grantee  shall be addressed to the Grantee at the current  address
shown on the payroll  records of the  Company.  Any notice shall be deemed to be
duly given if and when properly  addressed and posted by registered or certified
mail, postage prepaid.

SECTION 12.       INCORPORATION OF PLAN BY REFERENCE

         The Option is granted  pursuant to the terms of the Plan,  the terms of
which are incorporated herein by reference, and the Option shall in all respects
be interpreted in accordance  with the Plan. The Committee  shall  interpret and
construe   the  Plan  and  this   instrument,   and  its   interpretations   and
determinations  shall be  conclusive  and binding on the parties  hereto and any
other person claiming an interest  hereunder,  with respect to any issue arising
hereunder or thereunder.

SECTION 13.       GOVERNING LAW

         The  validity,   construction,   interpretation   and  effect  of  this
instrument shall exclusively be governed by an determined in accordance with the
law of the State of Arizona.


         IN WITNESS WHEREOF, the Company has caused its duly authorized officers
to execute and attest this Grant of  Incentive  Stock  Option,  and to apply the
corporate seal hereto,  and the Grantee has placed his or her signature  hereon,
effective as of the Date of Grant.

                                GUM TECH INTERNATIONAL, INC., a Utah corporation


                                By:_____________________________________________
                                            Gary Kehoe, President

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                                ACCEPTED AND AGREED TO:



                                ________________________________________________
                                WILLIAM J HEMELT

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