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                                                                         Exhibit
                              EMPLOYMENT AGREEMENT


        This Agreement is effective as of the 1st day of June, 1997, by and
between Richard DeCoste (hereinafter referred to as "Employee"), and Decora,
Incorporated (dba Decora Manufacturing), a Delaware Corporation, (hereinafter
referred to as "Employer").


                                 RECITALS


        WHEREAS, Employer desires to engage Employee to perform services on its
behalf on a full time basis as an employee under the terms and conditions of
this Agreement which, except as otherwise stated herein, shall supersede any
other understandings and agreements between the parties concerning employment;

        NOW, THEREFORE, it is mutually agreed as follows:

        1.     INCORPORATION OF RECITALS: The parties hereby incorporate by this
reference the recitals set forth above.


        2.     EMPLOYMENT: Employer hereby employs Employee and Employee hereby
accepts employment on the terms and conditions of this Agreement.


        3.     SERVICES:

               (a) Employee shall have the title of Vice President of Operations
of Employer which duties shall include, without limitation, the management of
all aspects of Employer's manufacturing, including without limitation:
production, quality control, purchasing, engineering, scheduling and product
development. Each year, Employee shall be responsible for meeting the objectives
of Employer's Operating Plan for such year. The Board of Directors of Employer
shall be entitled to change Employee's duties at its discretion based upon the
needs of Employer.

               (b) Employee agrees that he will at all times faithfully,
industriously and to the best of his ability, experience and talents, perform to
the reasonable satisfaction of Employer all of the duties that may be assigned
to him hereunder and shall devote such time to the performance of these duties
as may be reasonably necessary therefor.

               (c) During the term of the Agreement, Employee shall be available
on a full-time basis, to perform the duties assigned him, in accordance with the
prevailing policies of Employer. Expenditures of reasonable amounts of time for
personal, business, charitable and other activities shall not be deemed a breach
of this Agreement, provided that such activities do not interfere with the
services required to be rendered to Employer hereunder.


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               (d) Executive agrees that during the period of his employment,
Executive shall provide services exclusively pursuant to this Agreement, and
Executive will not, without the prior written consent of the Company (which
consent may be granted or withheld in the sole and absolute discretion of the
Company), directly or indirectly:

                      i) plan or organize any business activity competitive with
the business or planned business of the Company or its affiliates, or combine,
participate, or conspire with other employees of the Company or its affiliates
or other persons or entities for the purpose of organizing any such competitive
business activity; or

                      ii) divert or take away, or attempt to divert or take
away, any of the customers or potential customers of the Company or its
affiliates, either for himself or for any other person, firm, partnership,
corporation or other business entity.


        4.     EMPLOYER'S AUTHORITY: Employee agrees to observe and comply with
Employer's rules and regulations as adopted by Employer's board of directors
regarding performance of his duties and to carry out and to perform orders,
directions, and policies stated by Employer to him periodically, either orally
or in writing.


        5.     TERM: The term of this Agreement shall be three (3) years (the
"Term"). The Term of this Agreement shall, however, in any event, be subject to
prior termination as provided hereinbelow in Paragraph 10.


        6.     COMPENSATION:

               (a) Salary. Employer agrees to pay to Employee a base salary of
$140,000 per year. Employee's salary shall be reviewed from time to time. Such
salary shall be payable in installments in accordance with the general practice
of Employer.

               (b) Performance Compensation. For the fiscal year April 1, 1997
to March 31, 1998, the Executive shall be entitled to performance compensation
in accordance with the provisions of the Management Performance Incentive Plan
and the Salaried Employee Incentive Plan to be adopted by the Compensation
Committee of the Board of Directors of Decora Industries, Inc., subject to the
reservation by such committee contained in such plans of the right to amend or
terminate such Plans.


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        7.     TAXES:

               (a) DEDUCTIONS. All compensation shall be subject to the
customary withholding tax and other employment taxes as required with respect to
compensation paid by a corporation to an employee.


        8.     EMPLOYEE BENEFITS: In addition to the compensation set forth 
above, Employer agrees to grant Employee the following benefits for the Term:

               (a) An annual vacation with pay of three (3) weeks;

               (b) Sick leave and personal leave with pay in accord with the
prevailing policies of Employer;

               (c) Health and medical benefit insurance as granted by Employer
to employees performing similar services, except that any waiting period which
Employer can waive shall be waived;

               (d) Any other benefits not specifically set forth herein as may
be granted by Employer, in its sole and absolute discretion, including without
limitation, its 401(k) plan, life insurance and pension plan to employees
performing similar services; and

               (e) An automobile allowance of $500 per month.


        9.     BUSINESS EXPENSES: Employee may incur, on behalf of and for the
convenience of Employer, certain reasonable business expenses including travel
and entertainment and other miscellaneous expenses. Expenses of Employee
incurred on behalf of Employer, other than personal car expenses will be
reimbursed by Employer and it shall be the responsibility of Employee to retain
vouchers and other proof of proper expenditures. The decision as to whether an
expense incurred by Employee is for the benefit of Employer shall be in the sole
discretion of Employer, and all expenses not deemed to be incurred for the
benefit of Employer shall be paid by Employee.


        10.    TERMINATION:

               (a) This Agreement shall terminate at the option of the Employer:

                      i) Immediately upon the death or permanent disability of
Employee, "permanent disability" being defined as the inability of Employee to
perform his duties as required hereunder as a result of physical or mental
illness for a continuous period in excess of sixty (60) days.


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                      ii) At the election of the Employer, immediately upon the
dismissal of Employee by the Employer for cause. "Cause", as used in this
section, shall include, without limitation, any one or more of the following:

                          (1) The breach by Employee of any material term or
condition of this Agreement after written notice by Employer and failure of
Employee to satisfactorily cure the breach within 90 days;

                          (2) The refusal or failure to perform duties assigned
in accordance with the terms of this Agreement, if such refusal shall continue
for a 90 day period after written instructions to perform such duties have been
given under the authority of the Board of Directors of the Employer;

                          (3) Engaging in one or more acts constituting a
felony;

                          (4) Engaging in one or more acts involving fraud or
serious moral turpitude;

                          (5) Misappropriating Employer's assets or engaging in
gross misconduct materially injurious to the Employer or its affiliates or
subsidiaries; or

                          (6) Breach of any trade secrets and confidentiality
agreement with Employer, including without limitation the Trade Secrets and
Confidentiality Agreement dated as of the date hereof ("Secrecy Agreement") ;

               (b) The compensation paid upon termination shall be determined as
follows:

                      i) In the event of termination of this Agreement prior to
completion of the Term as set forth in Paragraph 10(a)(i) or 10(a)(ii), Employee
shall be entitled to receive only accrued, but unpaid compensation up to the
date of termination.

                      ii) In the event of any other termination of the Agreement
prior to the completion of the Term, Employee shall be entitled to receive his
compensation and benefits as set forth in this Agreement for the lesser of
twelve months from the date of termination or the remainder of the Term.

Employer shall have the option of paying such amount in accordance with its
regular payroll practices.


        11.    STOCK OPTIONS: Employee shall be granted an option to purchase up
to 100,000 shares of Decora Industries, Inc. common stock pursuant to that Stock
Option Agreement attached as Exhibit "A". The option shall be exercisable at an
exercise price equal


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to $1.00 per share. All such options shall be vested and shall be exercisable
for a period of three years.


        12.    NOTICE: All notices and demands of every kind shall be personally
delivered or sent by first class mail to the parties at their last known address
or at such other addresses as either party may designate in writing. Any such
notice or demand shall be effective immediately upon personal delivery or five
days after deposit in the United States mail, as the case may be.


        13.    ARBITRATION: Any claim arising out of this Employment Agreement
shall be settled by binding arbitration in New York, New York in accordance with
the Commercial Rules of the American Arbitration Association. The arbitrator
shall be an active member of the New York bar. The arbitrator shall prepare an
award in writing which shall include factual findings and any legal conclusions
on which the decision is based. Judgement upon an award so rendered may be
entered in any court having jurisdiction.


        14     REPRESENTATION: Employee acknowledges that he has been advised to
retain independent counsel and that he has not been represented by Miller &
Holguin.


        15.    MISCELLANEOUS:

               (a) This Agreement shall be governed and construed in accordance
with the substantive laws of the State of New York.

               (b) No change in the terms of this Agreement shall be effective
unless made in writing and signed by the Employee and a duly authorized
representative of Employer.

               (c) A waiver of any term or condition of this Agreement shall not
be construed as a general waiver by Employer and Employer shall be free to
reinstate any such term or condition with or without notice to the other party.

               (d) Employee's rights and obligations under this Agreement are
personal and not assignable.

               (e) This Agreement contains the entire Agreement and
understanding between the parties and supersedes all other agreements or
understandings between the parties concerning employment, whether oral or
written. Neither party has relied on any representations other than those as
contained herein. This Agreement shall not affect Employee's existing Option
Agreement dated January 11, 1993 by and between Employee and Decora Industries,
Inc.


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               (f) This Agreement shall be binding on and inure to the benefit
of the heirs, personal representatives, successors, and assigns of the parties;
subject, however, to the restrictions on assignment contained herein.

               (g) The paragraph headings used in this Agreement are for
reference and convenience only, and shall not in any way limit or amplify the
terms and provisions hereof, nor enter into the interpretation of this
Agreement.

        IN WITNESS WHEREOF, Employer has caused this Agreement to be signed by
their duly authorized officers and Employee has executed this Agreement
effective as of the day and year first above written.


EMPLOYER:                                EMPLOYEE:

DECORA MANUFACTURING



By:
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                                         RICHARD DECOSTE
Its:
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