EXHIBIT 10.5



                 INTERNATIONAL ISOTOPES INC EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT  AGREEMENT (as it may be amended or supplemented,  this
"Agreement")   is  entered  into  as  of  February  1,  2001,   by  and  between
International  Isotopes  Inc.,  a Texas  corporation  ("Company"),  and  Stephen
Laflin.

                                    RECITALS

         A.     Company  desires to employ  Employee  as its  President  and CEO
because of his  experience  and  expertise  and to secure his services  upon the
terms and subject to the conditions set forth in this Agreement.

         B.     Employee  desires and is willing to accept such  employment upon
such terms and subject to the conditions.

         THEREFORE,  for and in  consideration  of the  foregoing and the mutual
covenants and agreements contained in this Agreement, Company and Employee agree
as follows:

         1.     Employment.  Upon  the  terms  and  subject  to  the  conditions
contained in this  Agreement,  Company  hereby  employs  Employee;  and Employee
hereby accepts such employment, upon such terms and subject to such conditions.

         2.     Duties and Authority.

                2.1   Duties of  Employee.  During  the term of this  Agreement,
Employee  will serve as  Company's  Chief  Executive  Officer  of  International
Isotopes and will  faithfully and to the best of his ability perform such duties
consistent  with the  position  of  president  and CEO as 1 are  determined  and
directed  by the  Board of  Directors,  or as are  necessary  in the  reasonable
judgement of the Employee, to carry out his duties under this Agreement.  In his
capacity as President and Chief Executive  Officer,  Employee  will be generally
responsible for the implementation of directives of, and policies and procedures
adopted by the Board of Directors and for the overall  day-to-day  management of
duties.  In  performing  his duties  under this  Agreement,  Employee will fully
support and cooperate with Company's efforts to develop its markets,  expand its
business,  and operate  profitably and in conformity with business and strategic
plans approved from time to time by Company's Board of Directors.

                2.2   Direction  from the Board of Directors and Chairman of the
Board.  Employee will look primarily to the Board of Directors for direction and
guidance  as to the  performance  of  Employee's  duties  under this  Agreement;
however,  to  facilitate   communication  between  Employee  and  the  Board  of
Directors,  Employee will report on the status of Employee's  activities and the
performance of Employee's duties to the Chairman of the Board of Company at such
times  as he may be  requested.  Employee  will  receive  and  participate  in a
performance  review with the Chairman of the  Compensation  Committee  every six
months or other times if required.




Employment Agreement                                                      Page 1
<PAGE>


                2.3   Employee's Authority.  In performing his duties under this
Agreement,  Employee  will  have  such  authority  as is  necessary  for  him to
implement the directives of, and policies and procedures adopted by the Board of
Directors of the Company and to oversee the  management  of the Company's day to
day  affairs;  but,  from time to time as thought  appropriate  by  Employee  or
Company's  Chairman  of  the  Board,  Employee  will  discharge  his  duties  in
consultation  with and  under  the  direction  of the  Chairman  of the Board of
Company.  Without  limiting the generality of the  foregoing,  in exercising his
authority  as  Chief  Executive  Officer  of  Company,  Employee  will  have the
authority   for   employing,   dismissing,   and   assigning   job   duties  and
responsibilities to Company's employees.

                2.4   Time and  Attention to Services.  Employee will devote all
of his time and attention to the performance of his duties to Company during the
term of this  Agreement.  Company,  however,  recognizes  that  Employee  may be
engaged in other  non-conflicting  passive business investments and in community
activities  unrelated to his duties under this  Agreement that will require some
portion of his time, and Company hereby consents to Employee's attention to such
other activities so long as such activities (a) do not hinder Employee's ability
to perform his duties under this  Agreement  and (b) do not represent a conflict
of interest in  contravention  of the agreements  contained in paragraph 11 or a
competitive  activity in contravention of the agreements  contained in paragraph
13 of this Agreement.

                2.5   Election as an Officer.  Company will cause Employee to be
elected to the office of Chief  Executive  Officer and Board of Directors (as to
such other  offices,  if any, as Company's  Board of Directors  determines to be
appropriate).

         3.     Term and Termination.

                3.1   Term. This Agreement is effective as of the Effective Date
and will continue in effect until February 28, 2007, unless it is (a) terminated
in accordance  with I paragraph 3.2 or (b) extended in accordance with paragraph
3.3.

                3.2   Termination.  This  Agreement may be  terminated  prior to
February 28 2007, as follows:

                      (a)   Termination by Mutual Consent. This Agreement may be
terminated at any time by the written mutual consent of Company and Employee.

                      (b)   Termination By Company for Cause. This Agreement may
be  terminated by Company at any time for Cause by the delivery to Employee of a
written notice of termination  stating the effective date of termination and the
basis upon which this Agreement is being terminated.  As used in this Agreement,
the term "Cause" means (a) a material  default in the  performance of Employee's
duties under this Agreement,  or (b) Employee's dishonesty,  willful misconduct,
breach of fiduciary duty involving  personal  profit,  willful  violation of any
law, rule, or regulation,  action (or omission)  involving  moral  turpitude and
reflecting  unfavorably  upon the public image of Company or its Affiliates,  or
action (or omission)  abiding or abetting a competitor,  supplier or customer of
Company  or its  Affiliates  to the  material  disadvantage  of  Company  or its
Affiliates;  and the term  "Affiliate"  means  any other  person  or entity  who
directly controls,  is controlled by, or is under common control with Company or
any  Affiliate  of  Company  (and  "control"  means   possession,   directly  or
indirectly, of power to direct or cause the direction of management or policies,
whether through  ownership of voting  securities or otherwise).  In the event of
termination for Cause,  Employee will be entitled to such salary and benefits as
have accrued under this Agreement through the effective date of termination, but
will not be entitled to any other salary,  benefits, or other compensation after
such date.


Employment Agreement                                                      Page 2
<PAGE>


                      (c)   Termination By Company Without Cause. This Agreement
may be  terminated  by Company at any time without  Cause by (a) the delivery to
Employee of a written notice of  termination  not less than 60 days prior to the
effective  date of  termination,  or (b) a vote by the  Board of  Directors  and
Shareholders   to  effect  the  sale  or  dissolution  of  Company.   Upon  such
termination,  Employee  will be paid  salary and  benefits  as  provided in this
Agreement  through the effective  date of  termination  and for the period of 24
months after such date. The Company will not be obligated to pay any bonus after
the effective  date of  termination  except for bonus  payments  approved by the
Board of Directors and  Compensation  Committee  prior to the effective  date of
termination.

                      (d)   Termination  of  Employee.  This  Agreement  may  be
terminated by Employee at any time,  with or without  Cause,  by the delivery to
Company of a written  notice of  termination  not less than 90 days prior to the
effective date of termination. In the event of termination by Employee, Employee
will be  entitled  to such  salary  and  benefits  as have  accrued  under  this
Agreement through the effective date of termination, but will not be entitled to
any other salary, benefits, or other compensation after such date.

                      (e)   Termination  Upon Death or  Disability  of Employee.
This  Agreement  will be  terminated  immediately  upon the  death or  permanent
disability  (which shall be determined in accordance  with Company's  disability
plan as then in effect,  or if no such plan is then in effect,  as determined in
good faith by  Company's  Board of  Directors  at such time as Employee  becomes
physically or mentally  incapable or properly  performing  his duties under this
Agreement and such  incapacity will exist or can reasonably be expected to exist
for a period of ninety days or more) of Employee. In either such event, Employee
or his  beneficiary  as designated  in writing to Company (or his estate,  if no
such  beneficiary has been  designated) will be entitled to such benefits (i) as
are  consistent  with Company policy then if effect or (ii) as are determined by
Company's Board of Directors in its sole discretion.

                3.3   Extension  of Term.  At the time  period  thirty-six  (36)
months after the  effective  date of this  agreement,  Employee and Company will
reset the terms of this agreement,  and at that time decide by mutual  agreement
to extend  the term of the  agreement.  Each such  extension,  unless  expressly
agreed  otherwise by Employee and Company,  will be for five years commencing on
January 1 of the year  preceding  the  expiration of the original or any renewal
term.  Mutual  agreement to extend the term of this Agreement shall be evidenced
by either (a) a written  agreement  executed by Company and  Employee or (b) the
continuation of Employee's performance of services under this Agreement with the
approval  of  Company  and  without  notice of  termination  given by Company or
Employee.  Any extended term of this Agreement may be terminated as set forth in
paragraph 3.2 above, unless otherwise agreed in writing by Company and Employee.
In the event the term of this  agreement  is not  reset by mutual  agreement  by
Employee and Company, the original terms of the agreement will continue in force
and the termination date will remain February 25, 2007.



Employment Agreement                                                      Page 3
<PAGE>

         4.     Compensation.

                4.1   Base Annual Salary.  In consideration  for the performance
of his duties under this  Agreement,  Employee will be paid a base annual salary
of $120,000,  which shall be payable (less  applicable  withholding  for federal
taxes) in semi-monthly  installments or otherwise in such manner as the salaries
of other  executive  officers of Company  are paid in  accordance  with  Company
policy.

                4.2   Annual  Salary  Review.  Company's  Board of Directors and
Compensation  Committee will review  Employee's  salary level on an annual basis
and may elect, on the basis of such review,  to increase  Employee's base annual
salary;  but any such increase in  Employee's  Salary will be made solely at the
discretion of Company's Board of Directors.

                Bonus.  In addition to the annual  salary to be paid to Employee
pursuant to this  Agreement,  Employee will be considered for an annual bonus at
the end of each calendar or fiscal year of Company.  The Board of Directors,  at
its  discretion,  will determine the amount of the bonus,  if any, to be paid to
Employee after  considering  such factors related to the performance of Employee
and of  Company  during  the  preceding  fiscal  year as the Board of  Directors
determines to be appropriate.

                4.4   Independent Consideration. Concurrently with the execution
of  this  Agreement,  Company  is  making  a  payment  of $100  to  Employee  as
independent  and  additional  consideration  ("Independent  Consideration")  for
Employee's  agreement  to comply with the  provisions  of  paragraph  11 of this
Agreement.

         5.     Expenses  and  Reimbursements.  Employee  will  be  entitled  to
reimbursement  for reasonable  out-of-pocket  expenses incurred by Employee that
are directly  attributable  to the  performance of Employee's  duties under this
Agreement.  Employee will adhere to Company's customary practices and procedures
with respect to incurring  out-of-pocket  expenses and will present such expense
statements,  receipts,  vouchers, or other evidence supporting expenses incurred
by Employee as Company may from time to time request.

         6.     Benefits.  During the term of this  Agreement,  Employee will be
entitled to the benefits generally provided or made available to other executive
officers  of Company,  including,  but without  limitation,  such group  medical
(including  dental) insurance and life insurance  benefits as are made available
to employees of Company  generally and  participation in any "cafeteria" plan or
retirement plan that may be available to employees of Company (subject, however,
to (i)  eligibility  and (ii)  modification  or elimination  in accordance  with
Company's standard policies as in effect from time to time) and to the following
specific benefits:

                      (a)   Vacation. Employee will be entitled to such vacation
time as is allotted to other executive officers of Company (but in no event less
than fifteen working days in any calendar year).

                      (b)   Sick  Leave.   Employee  will  be  entitled  to  the
benefits,  and subject to all provisions  of,  Company's  standard  policies and
procedures regarding sick leave and time off.


Employment Agreement                                                      Page 4
<PAGE>


The Company will provide the employee with an equity  position in the company in
the month following the 2002 annual stockholders  meeting.  The amount and terms
of that position will be seperatly described in an employee options agreement.

Confidentiality   and   Non-Disclosure.   Employee   acknowledges  that  in  the
performance  of his duties to Company under this Agreement he will gain a close,
personal,  and special influence with Company's customers and suppliers and will
obtain  and/or  develop   certain  trade  secrets  and  valuable,   confidential
information  of or  pertaining  to Company  or its  Affiliates,  including,  but
without limitation,  information concerning the following:  operations; business
opportunities;  price and cost information;  finances;  customer names; customer
prospects, and customer lists; the terms of contracts with customers, suppliers,
and  agents;  business  plans;  marketing  and sales  plans;  sales  techniques;
manuals;  letters;   notebooks;   procedures;   reports;  products;   processes;
specifications;  services;  inventions;  research  and  development;  and  other
concepts or ideas involving or relating to the business or prospective  business
of  Company  (collectively,   "Confidential  Information"),  which  Confidential
Information  has been or will be  uniquely  developed  by or for  Company or its
Affiliates and cannot be readily obtained by third parties from outside sources.
Employee accordingly agrees as follows:

                      (c)   Detrimental   Statements.   For  so   long  as  this
Agreement  remains  in effect  and for a period  of 24 months  after the date of
termination or expiration of this Agreement (the "Applicable  Period),  Employee
will not, directly or indirectly,  in any individual or representative  capacity
whatsoever,  make any statement, oral or written, or perform any act or omission
which is or could be  detrimental  in any  material  respect to the  goodwill of
Company,  provided  that any truthful  statement  made by Employee in good faith
shall not violate this subparagraph.

                      (d)   Covenant  of   Confidentiality.   All   Confidential
Information  and other  information  communicated  to Employee  by, or otherwise
belonging to, Company,  its Affiliates,  or their  customers,  whether before or
after the Effective Date, shall at all times be held in strict confidence, shall
be used only for the purpose of this  Agreement,  and shall not be  disclosed by
Employee  without  the  prior  written  consent  of  Company,  except  as may be
necessary by reason of legal, accounting,  or regulatory requirements beyond the
reasonable  control  of  Employee.

                      (e)   Return of Lists. Books. Records. and Property.  Upon
the  expiration  of the term or  termination  of this  Agreement,  Employee will
surrender to Company all tangible Confidential  Information in the possession of
Employee, including, but without limitation, the originals and all copies of all
lists, books, and records of or pertaining to any Confidential Information,  and
all other property in the possession of Employee  belonging to Company or any of
its Affiliates.

Employment Agreement                                                      Page 5
<PAGE>


                      (f)   Right to Injunctive  Relief.  Employee  acknowledges
that a violation  or attempted  violation  on his part of any  agreement in this
paragraph 9 will cause irreparable damage to Company and to its Affiliates,  and
accordingly  Employee agrees that Company shall be entitled as a matter of right
to an injunction,  out of any court of competent  jurisdiction,  restraining any
violation or further violation of such agreements by Employee; and such right to
an injunction  shall be cumulative  and in addition to whatever  other  remedies
Company may have.

                      (g)   Survival  of Terms.  The terms  and  agreements  set
forth  in  this  paragraph  9  shall  survive  the  expiration  of the  term  or
termination  of this  Agreement  regardless of the reason.  The existence of any
claim of Employee,  whether predicated on this Agreement or otherwise, shall not
constitute a defense to the  enforcement by Company of the agreements  contained
in this  paragraph  9.

                      (h)   Separate  Non-Disclosure  Agreement.  If  after  the
Effective  Date  Company  so  requests,  Employee  will  enter  into a  separate
non-disclosure  agreement the provisions of which are  substantially the same as
those contained in this paragraph 9.

         7.     Proprietary Information.  Employee agrees to promptly and freely
disclose  to  Company in writing  any and all  ideas,  conceptions,  inventions,
improvements,  suggestions for improvements,  discoveries,  formulae, processes,
designs, software, hardware, circuitry, diagrams, copyrights, trade secrets, and
any other proprietary  information  (collectively,  "Proprietary  Information"),
whether patentable or not, which are conceived,  developed, and made or acquired
by Employee,  alone or jointly with others,  during the period of his employment
by Company or using Company's time,  data,  facilities,  and/or  materials,  and
which are related to the products,  business,  or activities of Company or which
Employee conceives,  develops,  makes, or acquires as a result of his employment
by  Company,  and  Employee  agrees to assign and hereby  does assign all of his
right,  title, and interest therein to Company.  Whenever  requested to do so by
Company, Employee will execute applications,  assignments, or other instruments,
which  Company  deems  necessary  to apply  for and  obtain  letters  patent  or
copyrights of the United  States or any foreign  country,  to otherwise  protect
Company's  interest  in any  Proprietary  Information,  or to vest  title to any
Proprietary  Information in Company. These obligations shall continue beyond the
expiration or termination of Employee's employment, regardless of the reason for
such  termination,  with  respect  to  any  Proprietary  Information  conceived,
developed, made, or acquired by Employee during the period of his employment and
shall be binding upon Employee's assigns, executors,  administrators,  and other
legal representatives.

         8.     Conflict  of  Interest.  In keeping  with  Employee's  fiduciary
duties to Company,  Employee  agrees that while employed by Company he will not,
acting along or in  conjunction  with  others,  directly or  indirectly,  become
involved in a conflict of interest or, upon discovery thereof,  allow a conflict
of interest to  continue.  Moreover,  Employee  agrees that he will  immediately
disclose to the Board of Directors any facts, which might involve any reasonable
possibility of a conflict of interest.  It is agreed that any direct or indirect
interest in, connection with, or benefit from any outside activities, where such
interest might in any way adversely affect Company, involves a possible conflict
of  interest.  Circumstances  in which a  conflict  of  interest  on the part of
Employee might arise, and which must be reported  immediately by Employee to the
Board  of  Directors,  include,  but are not  limited  to,  the  following:  (a)
ownership of a material  interest in any  supplier,  contractor,  subcontractor,
customer, or other entity with which Company does business;


Employment Agreement                                                      Page 6
<PAGE>

(b) acting in any capacity,  including director,  officer, partner,  consultant,
employee,   distributor,  agent,  or  the  like,  for  a  supplier,  contractor,
subcontractor,  customer, or other entity with which Company does business;  (c)
accepting,  directly or indirectly,  payment, service, or loans from a supplier,
contractor,  subcontractor,  customer,  or other entity with which  Company does
business,  including, but not limited to, gifts, trips, entertainment,  or other
favors of more than a nominal  value;  (d) misuse of  Company's  information  or
facilities to which Employee has access in a manner which will be detrimental to
Company's interest,  such as utilization for Employee's own benefit of know-how,
inventions, or information developed through Company's business activities;  (e)
disclosure  or other misuse of  Confidential  Information  of any kind  obtained
through  Employee's  connection  with  Company;  (0the  ownership,  directly  or
indirectly, of a material interest in an enterprise in competition with Company,
or  acting as an  owner,  director,  principal,  officer,  partner,  consultant,
employee, agent, servant, or otherwise of any enterprise which is in competition
with Company;  and (g) appropriation of a Corporate  Opportunity,  as defined in
paragraph 11 of this Agreement.

         9.     Corporate  Opportunities.  Employee acknowledges that during the
course of his  employment  by  Company  he may be  offered  or  become  aware of
business  or  investment  opportunities  in which  Company  may or might have an
interest (a "Corporate Opportunity") and that he has a duty to advise Company of
any such Corporate Opportunities before acting upon them. Accordingly,  Employee
agrees (a) that he will  disclose to Company's  Board of Directors any Corporate
Opportunity offered to Employee or of which Employee becomes aware, and (b) that
he will not act upon any  Corporate  Opportunity  for his own benefit or for the
benefit of any person or entity other than Company  without first  obtaining the
consent or approval of Company's  Board of Directors  (whose consent or approval
may be  granted  or  denied  solely  at the  discretion  of  Company's  Board of
Directors).

         10.    Non-Competition.

                10.1  Covenant Not to Compete.  As an ancillary  covenant to the
terms and conditions set forth  elsewhere in this  Agreement,  and in particular
the  covenants  set forth in paragraph 9,  paragraph 10, and paragraph 11 above,
and in  consideration  of the mutual  promises set forth in this  Agreement  and
other good and valuable  consideration  received and to be received,  including,
but without limitation,  the Independent  Consideration,  which has been paid to
Employee in consideration  of Employee's  agreement to comply with the terms and
conditions of this paragraph 12, Employee  agrees that,  during the term of this
Agreement,  and throughout the Applicable Period, Employee will not, directly or
indirectly,  own or become employed by or otherwise provide consulting  services
to, any business  competitive  with Company prior to the date of  termination of
this  Agreement in any country in which Company  commences  business  while this
Agreement  remains in effect.  Employee  understands  that the current  business
activities of Company and its Affiliates  include the production of high quality
radioisotopes,      pharmaceutical      grade      radiochemicals,      finished
radiopharmaceuticals  and diagnostic ant therapeutic  medical  products and that
Company and its Affiliates have plans to expand the scope of such activities and
the  geographic  area of  operations  of Company and its  Affiliates in the near
future with the direct involvement of Employee,  therefore, Employee agrees that
the limitations as to time,  geographical  area, and scope of activity contained
in this covenant do not impose a greater  restraint than is necessary to protect
the goodwill and other business  interests of Company.  If any provision of this
covenant  is found to be invalid  in part or in whole,  Company  may elect,  but
shall not be required, to have such provision reformed, whether as to time, area
covered,  or  otherwise,  as and to the extent  required for its validity  under
applicable law and, as so reformed, such provision shall be enforceable.


Employment Agreement                                                      Page 7
<PAGE>

                10.2  Right to Injunctive Relief.  Employee  acknowledges that a
violation or attempted  violation on his part of any agreement in this paragraph
13 will cause irreparable  damage to Company and its Affiliates, and accordingly
Employee  agrees  that  Company  shall be  entitled  as a manner  of right to an
injunction,  out  of  any  court  of  competent  jurisdiction,  restraining  any
violation or further violation of such agreements by Employee;  such right to an
injunction,  however,  shall be  cumulative  and in addition  to whatever  other
remedies  Company may have.  Furthermore,  Employee  shall be entitled to seek a
declaratory judgment regarding any conduct or enterprise to determine whether or
not such  conduct or  violation  is  violative  of the terms of this  Agreement;
provided  however,  that no suit shall be filed until Employee has given Company
at least 15 days to respond to  Employee's  written  request for  permission  to
undertake  certain  requested  acts.  The terms and agreements set forth in this
paragraph 13 shall  survive the  expiration of the term or  termination  of this
Agreement  for any  reason.  The  existence  of any claim of  Employee,  whether
predicated on this Agreement or otherwise, shall not constitute a defense to the
enforcement by Company of the agreements contained in this paragraph 12.

                10.3  Separate Non-Competition Agreement. If after the Effective
Date Company so requests,  Employee  will enter into a separate  non-competition
agreement the provisions of which are  substantially the same as those contained
in this paragraph 12.

         11.    Indemnification.  Company, shall, and does hereby, indemnify and
agree to hold Employee  harmless to the fullest extent  provided to officers and
directors of Company under  Article VII of Company's  First Amended and Restated
Bylaws,  as amended from time to time (the "Bylaws  Indemnification");  provided
that (a)  Employee  shall be entitled to all  benefits  provided to directors of
Company under the Bylaws Indemnification,  whether or not Employee is, or at any
time is elected, a director of Company; (b) any determination of indemnification
made under the Bylaws  Indemnification with respect to Employee shall be made by
special legal  counsel  selected by the mutual  agreement of Company's  Board of
Directors and Employee (or, if Company's  Board of Directors and Employee cannot
agree,  then by Company,  but in such case, such legal counsel must be a partner
or  shareholder in a law firm  headquartered  in the State of Idaho or Texas and
having  no  fewer  than  100  lawyers);  and (c) if for any  reason  the  Bylaws
Indemnification  has been  terminated or is otherwise  inapplicable to Employee,
Employee  shall be entitled  to  indemnification  to the  fullest  extent that a
corporation may grant indemnification to a director, officer, and employee under
the Texas Business Corporation Act, as the same exists or as it may hereafter be
amended ("TBCA"), if Employee was, or is threatened to be made a named defendant
or respondent in a preceding (as hereinafter defined) because Employee (i) is or
was an employee of Company or an  Affiliate  of Company as a director,  officer,
partner,  venturer,  proprietor,  trustee,  employee,  agent,  or  in a  similar
position in a partnership,  joint venture, sole proprietorship,  trust, employee
benefit plan, or other  enterprise in which Employee serves on behalf of Company
or at Company's request. In the event of Employee's death such right shall inure
to the benefit of Employee's heirs, successors, and assigns. The indemnification
granted  to  Employee  hereunder  is a  contract  right  and shall  survive  the
expiration  of the term or  termination  of this  Agreement and Company shall be
obligated  to  indemnify  Employee  pursuant  to and  in  accordance  with  this
paragraph 13  regardless of whether this  Agreement  shall have expired or shall
have been  terminated.  The rights conferred above shall not be exclusive of any
other right which  Employee  may have or  hereafter  acquire  under any statute,
bylaw, resolution of shareholders or directors,  agreement or otherwise. As used
in this  paragraph,  the term  "proceeding"  means any threatened,  pending,  or
completed  action,  suit,  or  proceeding,   whether  a  civil,   criminal,   or
administrative proceeding or an arbitration or investigation,  any appeal in any
such action,  suit, or proceeding,  and any inquiry or investigation  that could
lead to such an action, suit, or proceeding.


Employment Agreement                                                      Page 8
<PAGE>


         12.    Company's  Right  of  Offset.  Should  Employee  at any  time be
indebted  to Company,  or  otherwise  obligated  to pay money to Company for any
reason,  Company,  at its  election,  may offset  amounts  otherwise  payable to
Employee under this Agreement,  including,  but without  limitation,  salary and
bonus  payments,  against any such  indebtedness or amounts due from Employee to
Company.

         13.    Miscellaneous.

                13.1  Governing  Law.  THIS  AGREEMENT  SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF IDAHO.

                13.2  Entirety  and  Amendments.  This  Agreement  embodies  the
entire  agreement  between the parties and supersedes  all prior  agreements and
understandings  relating to the subject  matter  hereof  This  Agreement  may be
amended or modified only in writing executed by Employee and the Chairman of the
Board or another officer of the Company expressly  authorized by Company's Board
of Directors.

                13.3  Notices. Any notice or other communication  hereunder must
be in  writing  to be  effective  and shall be deemed  to have been  given  when
personally  delivered  to Employee  or Company  or, if mailed,  on the third day
after it is  enclosed  in an  envelope  and sent  certified  mail/return receipt
requested in the United  States mail.  Either party may from time to time change
its address for  notification  purposes by giving the other party written notice
of the new address and the date upon which it will become effective. The address
for each party for notices hereunder is as follows:

                Employee:      Stephen Laflin

                Company:       International Isotopes Inc.

                13.4  Attorney's  Fees.  In  the  event  that  either  party  is
required to obtain the  services of an attorney in order to enforce any right or
obligation  hereunder,  the  prevailing  party  shall  be  entitled  to  recover
reasonable attorney's fees and court costs from the other party.

                13.5  Assignability;  Binding Nature. Neither this Agreement nor
any right, duty, obligation,  or interest hereunder may be assigned or delegated
by one party hereto without the prior written consent of the other party hereto.
This  Agreement  is binding  upon  Company  and  Employee  and their  respective
successors, heirs and assigns


Employment Agreement                                                      Page 9
<PAGE>


                13.6  Headings.  The  headings of  paragraphs  contained in this
Agreement are for convenience  only and shall not be deemed to control or affect
the meaning or construction of any provision of this Agreement.

                13.7  Severability.  If,  but  only  to  the  extent  that,  any
provision of this  Agreement is declared or found to be illegal,  unenforceable,
or void,  then both  Company and Employee  shall be relieved of all  obligations
arising under such  provision,  it being the intent and agreement of Company and
Employee that this Agreement shall be deemed amended by modifying such provision
to the extent  necessary to make it legal and enforceable  while  preserving its
intent.  If such amendment is not possible,  another provision that is legal and
enforceable  and achieves the same objective shall be substituted  therefor.  If
the remainder of this  Agreement is not affected by such  declaration or finding
and is capable of substantial performance by both Company and Employee, then the
remainder shall be enforced to the extent permitted by law.

                13.8  Counterparts.  This  Agreement  may be  executed in one or
more  counterparts,  each of  which  will  be  deemed  to be  part  of the  same
instrument.









Employment Agreement                                                     Page 10
<PAGE>


         Executed as of the Effective Date set forth above by:


INTERNATIONAL ISOTOPES INC.

By:  /S/                                          /S/
     -------------------------                    -------------------------
     Name                                         Employee's Name

Title:  Chairman of the Board                     Title:  President & CEO
        ----------------------                            -----------------

Date:   23   Feb    2002                          Date:   Feb  23,  2002
        ----------------------                            -----------------









Employment Agreement                                                     Page 11
<PAGE>