EXHIBIT 10.32
                                    AGREEMENT

      THIS AGREEMENT (the "Agreement") is made and entered into as of this the 
30th day of October, 1996 by and among (a) Zeotech Industries, Inc. ("Zeotech"),
Ed Hemsted ("Hemsted"), W.D. Groves ("Groves"), KJM Capital Corp. ("KJM"), 
Keith J. McKenzie ("McKenzie"), and Kent E. Lovelace, Jr. ("Lovelace"), (b) LS
Capital Corporation, a Delaware corporation ("LS Capital"), and (c) Griffin Gold
Group, Inc., a Delaware corporation and a wholly-owned subsidiary of LS Capital 
prior to the consummation of the transactions provided for by this Agreement 
("Griffin").  For purposes of this Agreement, in certain cases, Zeotech and
Hemsted (acting separately or collectively) are referred to collectively as 
"Zeotech/Hemsted", and KJM and McKenzie (acting separately or collectively)
are referred to collectively as "KJM/McKenzie."

                                    Recitals

      WHEREAS, Zeotech/Hemsted,  Groves, KJM/McKenzie and Lovelace (such persons
are  referred  to  separately  as  a  "Contributor"   and  collectively  as  the
"Contributors")  separately own certain mining claims,  namely the Amanda Claims
and that portion of the Barstow claims that are not committed, such claims being
more fully  described on Exhibit A hereto  applicable  to the Amanda  Claims and
Exhibit B hereto  applicable  to the Barstow  Claim (such claims are referred to
separately as a "Claim" and collectively as the "Claims");

      WHEREAS,  the Contributors are willing to contribute the Claims to Griffin
in exchange  for shares of common stock in Griffin  (the  "Griffin  Shares") and
shares of common  stock in LS Capital  (the "LS Capital  Shares"),  all upon the
terms, provisions and conditions set forth hereinafter; and

      WHEREAS,  Griffin is willing  to receive a  contribution  of the Claims in
exchange for the issuance of Griffin Shares, all upon the terms,  provisions and
conditions  set forth  hereinafter,  and LS Capital is  willing  for  Griffin to
receive a contribution  of the Claims in exchange for the issuance of LS Capital
Shares, all upon the terms, provisions and conditions set forth hereinafter;

                                    Agreement

      NOW,  THEREFORE,  in  consideration  of the  mutual  agreements  contained
herein, $10.00 and other good and valuable consideration (the receipt,  adequacy
and sufficiency of which are hereby acknowledged by each of the parties hereto),
each of the parties mentioned above hereby agrees as follows:

      1.    General Representations and Warranties.

      (a)  Each  of  Zeotech,  Hemsted,  Groves,  KJM,  McKenzie,  and  Lovelace
(referred to hereinafter  separately as a "Representor"  and collectively as the
"Representors"), severally but


<PAGE>



not jointly,  hereby represents and warrants to LS Capital and Griffin that such
Representor  has full right,  power and  authority  to execute and deliver  this
Agreement and all other agreements,  documents and instruments to be executed in
connection  herewith and perform such  Representor's  obligation  hereunder  and
thereunder;  each  corporate  Representor  has been duly  organized,  is validly
existing  and  is  in  good  standing  in  the  jurisdiction  in  which  it  was
incorporated;  the  execution  and delivery by a corporate  Representor  of this
Agreement and all other agreements,  documents and instruments to be executed by
such  Representor in connection  herewith have been  authorized by all necessary
corporate  action  by such  Representor;  when  this  Agreement  and  all  other
agreements,  documents and  instruments  to be executed by such  Representor  in
connection herewith are executed by such Representor and delivered to LS Capital
and Griffin, this Agreement and such other agreements, documents and instruments
will constitute the valid and binding agreements of such Representor enforceable
against such Representor in accordance with their respective terms;  neither the
execution and delivery of this Agreement or any other agreements,  documents and
instruments to be executed in connection  herewith nor the  consummation  of the
transactions  contemplated hereby or thereby will (i) violate,  conflict with or
result in the breach or termination of, or otherwise give any other  contracting
party the right to terminate,  or constitute a default (by way of  substitution,
novation  or  otherwise)  under  the  terms  of,  any  contract  to  which  such
Representor is a party or by which such  Representor is bound or by which any of
the assets of such  Representor is bound or affected,  (ii) violate any judgment
against,  or  binding  upon,  such  Representor  or  upon  the  assets  of  such
Representor,  (iii)  result in the creation of any lien,  charge or  encumbrance
upon any assets of such Representor  pursuant to the terms of any such contract,
or (iv)  violate any  provision  in the charter  documents,  bylaws or any other
agreement  affecting the  governance  and control of any corporate  Representor;
there are no actions,  suits,  claims or legal,  administrative  or  arbitration
proceedings  or  investigations  pending or  threatened  against,  involving  or
affecting  any of  the  assets  of  such  Representor,  this  Agreement,  or the
transactions  contemplated  hereby, and there are no outstanding orders,  writs,
injunctions or decrees of any court, governmental agency or arbitration tribunal
against, involving or affecting any assets of such Representor,  this Agreement,
or the transactions  contemplated hereby; no consent or approval from any person
is required in  connection  with the  execution  and delivery of this  Agreement
other than board of director approval of each corporate  Representor,  which has
already been obtained;  and the  representations and warranties made immediately
above and elsewhere  herein are material to LS Capital and Griffin and are being
relied upon by LS Capital  and Griffin in  connection  with their  decisions  to
enter into the transactions provided for by this Agreement.

      (b) Each of LS Capital and  Griffin,  severally  but not  jointly,  hereby
represents and warrants to each  Representor  that it has full right,  power and
authority  to execute  and  deliver  this  Agreement  and all other  agreements,
documents  and  instruments  to be executed  by it in  connection  herewith  and
perform its obligation hereunder and thereunder;  it has been duly organized, is
validly  existing and is in good  standing in the  jurisdiction  in which it was
incorporated;  the execution and delivery by it of this  Agreement and all other
agreements,  documents  and  instruments  to be  executed  by  it in  connection
herewith  have been  authorized  by all necessary  corporate  action;  when this
Agreement and all other agreements,  documents and instruments to be executed by
it in connection herewith are executed by it and delivered to


<PAGE>



the  Representors,  this  Agreement  and such other  agreements,  documents  and
instruments  will constitute the valid and binding  agreements of it enforceable
against it in accordance with their respective terms;  neither the execution and
delivery of this Agreement or any other agreements, documents and instruments to
be executed in  connection  herewith nor the  consummation  of the  transactions
contemplated hereby or thereby will (i) violate,  conflict with or result in the
breach or  termination  of, or otherwise  give any other  contracting  party the
right to terminate, or constitute a default (by way of substitution, novation or
otherwise)  under the terms of, any  contract to which it is a party or by which
it is bound or by  which  any of the  assets  of it is bound or  affected,  (ii)
violate any judgment  against,  or binding  upon,  it or upon its assets,  (iii)
result in the creation of any lien, charge or encumbrance upon any of its assets
pursuant to the terms of any such contract, or (iv) violate any provision in the
charter  documents,  bylaws or any other agreement  affecting the governance and
control of it; there are no actions,  suits, claims or legal,  administrative or
arbitration   proceedings  or  investigations  pending  or  threatened  against,
involving or affecting any of its assets,  this Agreement,  or the  transactions
contemplated hereby, and there are no outstanding orders, writs,  injunctions or
decrees of any  court,  governmental  agency or  arbitration  tribunal  against,
involving or affecting any of its assets,  this Agreement,  or the  transactions
contemplated  hereby;  no consent or  approval  from any person is  required  in
connection  with the execution and delivery of this  Agreement;  the outstanding
capital stock of Griffin consists of 5,000,000 Griffin Shares,  all of which are
owned by LS Capital;  the Griffin  Shares and the LS Capital Shares to be issued
to the Contributors pursuant to this Agreement shall be duly authorized, validly
issued,  fully paid and non-assessable at the time that they are issued; and the
representations  and warranties made immediately  above and elsewhere herein are
material to each  Representor  and are being relied upon by each  Representor in
connection  with such  Representor's  decision  to enter  into the  transactions
provided for by this Agreement.

      2. Contribution of Claims and Issuance of Griffin Shares.

      (a) Each  Contributor  agrees to contribute as soon as possible  after the
date of this Agreement,  by means of customary  assignment  documents reasonably
selected by LS Capital and Griffin and reasonably  approved by the  Contributors
(the "Assignments"), full right, title and interest in and to each Claim held by
such Contributor,  free and clear of all liens,  mortgages,  security interests,
encumbrances,  claims and restrictions on the transfer thereof. Each Contributor
hereby  agrees that he will  execute and  deliver,  or cause to be executed  and
delivered,  from time to time  after the date  hereof,  upon the  request  of LS
Capital  or  Griffin,  such  other  instruments  of  assignment,   transfer  and
conveyance  and will take  such  other  action  as LS  Capital  or  Griffin  may
reasonably  require to effectuate and/or evidence the contribution  provided for
herein.  Each  Contributor  hereby  represents  and  warrants  to LS Capital and
Griffin that the  execution by such  Contributor  and delivery to Griffin of the
Assignment   respecting  the  Claims  to  be  contributed  to  Griffin  by  such
Contributor  will vest in Griffin full right,  title and interest in and to such
Claims, free and clear of any and all encumbrances,  security interests,  liens,
charges, claims,  restrictions or limitations,  whatsoever, by any person of any
kind, including those on the transfer thereof, whether known or unknown.

      (b) In consideration of the contribution by the Contributors of the Claims
to Griffin, each


<PAGE>



Contributor shall be issued Griffin Shares; provided, however, pending Griffin's
receipt of the full amount of the Additional  Capital  Contribution  (as defined
herein) the stock  certificates  representing  the Griffin  Shares issued to the
Contributors shall be held by Griffin and released to the Contributors only upon
Griffin's receipt of the full amount of the Additional Capital Contribution. The
number of Griffin Shares to issued to each Contributor is indicated in the table
below.


<TABLE>
<CAPTION>

                                           Number of Griffin Shares
<S>             <C>                               <C>

            Zeotech/Hemsted                      1,250,000

            Groves                               1,250,000

            KJM/McKenzie                         1,375,000

            Lovelace                             1,125,000
</TABLE>

      (c) (i) If any Contributor or LS Capital (referred to in this Section 2(c)
as the "Transferring  Stockholder") desires to dispose of its Griffin Shares now
owned or hereafter acquired, the Transferring  Stockholder shall first offer, in
writing in the manner provided for in Section 10(g) hereof,  to sell its Griffin
Shares to  Griffin,  at a purchase  price and on such terms as the  Transferring
Stockholder  intends  in good  faith to sell to a bona  fide  third  party.  The
written  offer shall  contain the  identity of the proposed  transferee  and the
purchase price and terms upon which the transfer is proposed to occur. Following
the receipt of the written offer provided for hereinabove, Griffin shall have an
option,  exercisable for thirty (30) days, to purchase all or any portion of the
Griffin  Shares  proposed  to be sold at the price and on the terms set forth in
the notice.  If Griffin  fails to exercise its option with respect to all of the
Griffin Shares proposed to be transferred, then Griffin shall notify immediately
each of its  stockholders  of its  failure to fully  exercise  its  option.  The
Griffin stockholders shall then have concurrent options, exercisable for fifteen
(15) days  commencing  on the date of Griffin's  notice,  to purchase all or any
portion of the Griffin Shares not purchased by Griffin, on a basis proportionate
to their respective stock ownership.  If one or more of the Griffin stockholders
elects to purchase such stockholders' full proportionate  shares and one or more
others do not, the Griffin  stockholders who exercised their options to purchase
their full proportionate shares shall have concurrent options to purchase all of
the remaining Griffin Shares subject to the options, on a basis proportionate to
their respective stock ownership, exercisable for a period of five (5) days from
the expiration of the Griffin  stockholders'  initial  concurrent  options.  The
foregoing  procedure shall be repeated until each Griffin stockholder has had an
opportunity  to purchase as many of the Griffin Shares subject to the options as
such stockholder desires, subject to the right of the other Griffin stockholders
to purchase  their full  proportionate  shares.  Notwithstanding  anything  else
contained in this Section  2(c),  neither  Griffin nor the Griffin  stockholders
shall have any rights to purchase any Griffin Shares  proposed to be transferred
by the Transferring  Stockholder unless Griffin and/or the Griffin stockholders,
separately or


<PAGE>



collectively,  exercise  the  options  provided  for in this  Section  2(c) with
respect to all,  and not less than all,  of the  Griffin  Shares  proposed to be
transferred.

            (ii) In the event that all of the Griffin Shares proposed to be sold
by the  Transferring  Stockholder  are not  purchased  in  accordance  with this
Section  2(c) before the  expiration  of the time  periods  established  in this
Section 2(c)  therefor,  all of the Griffin Shares may be sold to the transferee
identified  in the written  notice to Griffin at a price no lower and upon terms
no more  favorable  than the price and terms that the Griffin  Shares could have
been purchased pursuant to the options to which it was subject.  Such sale shall
be free and clear of the  terms of this  Section  2(c)  during  the  three-month
period  beginning  on the date that the last option  period in this Section 2(c)
terminates, but thereafter any Griffin Shares not so sold shall again be subject
to the terms and conditions of this Section 2(c).  Any attempted  disposition in
contravention  of the provisions of this Section 2(c) shall be null and void and
of no force and effect and,  therefore,  shall not  preclude the exercise of the
options provided for in this Section 2(c).

            (iii) The closing of the sale and  purchase  of any  Griffin  Shares
pursuant to this  Section  2(c) shall occur  within  fifteen (15) days after the
last option  exercised is exercised in accordance with this Section 2(c). At the
closing,  (a) the Transferring  Stockholder  shall deliver the appropriate stock
certificates,  properly  endorsed or accom-  panied by a properly  prepared  and
executed  stock power,  and (b) the purchasers  shall deliver the  consideration
required by this Section  2(c).  Each of the parties  hereby grants to the other
the  right  of  specific  performance  with  respect  to  this  Section  2(c) in
recognition of the uniqueness of the subject matter hereof.

            (iv) All certificates  representing Griffin Shares now owned or that
may hereafter be acquired by a Contributor  or LS Capital shall have a legend on
the back thereof substantially as follows:

      SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A RIGHT
OF FIRST REFUSAL AGREEMENT WHICH PROVIDES SIGNIFICANT RESTRICTIONS ON THE 
TRANSFERABILITY OF THE SHARES REPRESENTED HEREBY.

      Such  certificates  shall  state on the  front  thereof  substantially  as
follows:

      SEE RESTRICTIONS ON TRANSFER HEREOF ON REVERSE SIDE.

            (v) The agreements  contained in this Section 2(c) may be terminated
by an  instrument  in writing  signed by all  Contributors  and LS Capital.  The
agreements contained in this Section 2(c) shall automatically terminate whenever
the Griffin Shares or any securities received with respect to the Griffin Shares
becomes registered under the Act.

      3.  Issuance  of LS  Capital  Shares.  In  further  consideration  of  the
contribution by  Zeotech/Hemsted,  Groves and  KJM/McKenzie of their  respective
Claims to Griffin,


<PAGE>



Zeotech/Hemsted,  Groves and KJM/McKenzie shall be issued LS Capital Shares. The
number  of  LS  Capital  Shares  to  issued  to   Zeotech/Hemsted,   Groves  and
KJM/McKenzie is indicated in the table below.
<TABLE>
<CAPTION>

                                           Number of LS Capital Shares
<S>            <C>                                 <C>     

            Zeotech/Hemsted                      166,666

            Groves                               166,666

            KJM/McKenzie                         166,667
</TABLE>

      4.  Additional  Capital  Contribution.  From time to time but on or before
April  30,  1997,  Zeotech/Hemsted,   Groves  and  KJM/McKenzie  shall  make  an
additional  capital  contribution  (the "Additional  Capital  Contribution")  to
Griffin in the aggregate  amount of $500,000 for which  Zeotech/Hemsted,  Groves
and KJM/McKenzie  shall receive no additional  Griffin Shares, LS Capital Shares
or any other item. Each of Zeotech/Hemsted, Groves and KJM/McKenzie grants to LS
Capital a pledge of and security interest in and agrees and acknowledges that LS
Capital has and shall  continue to have a pledge of and security  interest  each
and every  one of the  Griffin  Shares  issued to them  separately  pursuant  to
Section 2 above,  to secure their  obligations  to make the  Additional  Capital
Contribution  on or before  April 30,  1997;  and if they fail to  fulfill  such
obligations  timely LS Capital  shall have all rights and  remedies of a secured
party with respect to such Griffin Shares.

      5.    Securities Representations and Warranties.

      (a) Each  Contributor  (other than  Lovelace),  severally but not jointly,
hereby  represents and warrants to LS Capital and Griffin that such  Contributor
is not a "U.S.  Person" as that term in defined in Regulation S under Securities
Act of 1933 (the "Act");  at the time the buy order  originated  for any Griffin
Shares or LS Capital Shares and the date of this Agreement, such Contributor was
and  will be  outside  of the  United  States  of  America  (the  "U.S.");  such
Contributor  is acquiring the Griffin  Shares and the LS Capital  Shares for its
own  account  and not on  behalf  of any  U.S.  Person,  and a sale has not been
prearranged  with a U.S.  Person or a purchaser  in the U.S.;  such  Contributor
agrees that all offers and sales of the Griffin Shares and the LS Capital Shares
prior to the  expiration  of a  period  commencing  on the date of the  issuance
thereof and ending 40 days thereafter  shall only be made in compliance with the
safe harbor contained in Regulation S, or pursuant to the  registration  thereof
or an exemption from  registration  (and in all cases in accordance with Section
2(c) hereof),  and that all offers and sales in the U.S. after expiration of the
40- day period  shall be made only  pursuant to the  registration  thereof or an
exemption from  registration  (and in all cases in accordance  with Section 2(c)
hereof);  all offering  documents  received by such  Contributor  have  included
statements,  and all stock  certificates  that such  Contributor  shall  receive
representing  Griffin Shares or LS Capital Shares shall feature legends,  to the
effect  that  the  Griffin  Shares  and the LS  Capital  Shares  have  not  been
registered  under the Act and may not be offered or sold in the U.S.  or to U.S.
Persons prior to the expiration of a period commencing on the date of the


<PAGE>

issuance  thereof and ending 40 days  thereafter  and all offers and sales shall
only be made in  compliance  with the safe harbor  contained in Regulation S, or
pursuant to the  registration  thereof or an exemption from  registration;  such
Contributor  has been  furnished  with LS Capital's most recent Annual Report on
Form 10-K and any subsequent  Quarterly Reports on Form 10-Q and Current Reports
on Form 8-K;  such  Contributor  is familiar  with the  business  and  financial
condition,  properties,  operations and prospects of LS Capital and Griffin, and
has been given full access to all material information concerning the condition,
properties, operations and prospects of LS Capital and Griffin; such Contributor
has had an opportunity to ask such questions of, and to receive such information
from, LS Capital and Griffin as such  Contributor  has desired and to obtain any
additional  information  necessary to verify the accuracy of the information and
data  received;  and such  Contributor  is  satisfied  that there is no material
information concerning the condition, properties, operations and prospects of LS
Capital and Griffin, of which such Contributor is unaware.

      (b) Lovelace hereby represents and warrants to LS Capital and Griffin that
he is a director of LS Capital and that as such he is familiar with the business
and financial condition, properties,  operations and prospects of LS Capital and
Griffin,  he has been given full access to all material  information  concerning
the condition,  properties,  operations and prospects of LS Capital and Griffin,
he has  had an  opportunity  to ask  such  questions  of,  and to  receive  such
information  from,  LS Capital  and  Griffin as he has desired and to obtain any
additional  information  necessary to verify the accuracy of the information and
data  received,  and he is  satisfied  that  there  is no  material  information
concerning the condition, properties, operations and prospects of LS Capital and
Griffin, of which he is unaware; he has such knowledge,  skill and experience in
business,  financial and investment  matters so that he is capable of evaluating
the merits and risks of an  acquisition of the Griffin  Shares;  he has reviewed
its or his financial  condition and commitments and that,  based on such review,
he is satisfied that he (a) has adequate  means of providing for  contingencies,
(b) has no present or  contemplated  future need to dispose of all or any of the
Griffin  Shares to  satisfy  existing  or  contemplated  undertakings,  needs or
indebtedness,  (c) is capable of bearing the economic  risk of the  ownership of
the Griffin Shares for the indefinite  future,  and (d) has assets or sources of
income which, taken together, are more than sufficient so that he could bear the
loss of the entire  value of the Griffin  Shares;  he is  acquiring  the Griffin
Shares solely for his own beneficial account, for investment  purposes,  and not
with a view to, or for  resale  in  connection  with,  any  distribution  of the
Griffin Shares;  he understands that the Griffin Shares have not been registered
under the Act or any state  securities laws and therefore the Griffin Shares are
"restricted"  under such laws; and he has not offered or sold any portion of the
Griffin Shares and has no present intention of reselling or otherwise  disposing
of any portion of the Griffin Shares either  currently or after the passage of a
fixed or determinable period of time or upon the occurrence or non-occurrence of
any predetermined event or circumstance.

      6.  Securities  Registration.  Griffin  may at the  option of its Board of
Directors  register with the United States  Securities  and Exchange  Commission
(the  "Commission")  an  in-kind  dividend  to the  stockholders  of LS  Capital
consisting of 1,000,000  Griffin Shares owned by LS Capital,  which shares equal
10% of the total  number of  outstanding  Griffin  Shares.  In the event of such
registration,  Griffin shall use its best efforts to qualify such Griffin Shares
under


<PAGE>

the  securities  laws for each state for which an exemption is not available and
qualification  is  required,  unless the cost and expense of such  qualification
outweighs  the benefit of  qualification.  In connection  with any  registration
undertaken  pursuant to this Section 6, each  Contributor  shall use  reasonable
efforts to cooperate with Griffin and LS Capital and will furnish to Griffin and
LS Capital in writing  such  information,  as shall be  reasonably  necessary in
order to assure  compliance  with federal and applicable  state  securities laws
pertaining to disclosure  and  otherwise,  with respect to the Claims,  the gold
mining industry and the micro-fine leach recovery  technology,  know-how,  trade
secrets and inventions developed by Groves (as described in United States Patent
No.     5,405,430    or    any    substitutes,     revisions,     continuations,
continuations-in-part,  renewals,  reissues,  re-examinations,  extensions,  and
divisions thereof, or any other Letters Patent therefore in the United States or
any  countries  foreign  to the  United  States),  as  well  as  any  subsequent
improvements,    modifications,   variations,   additions,   substitutions,   or
enhancements  of  such  technology,  know-how,  trade  secrets  and  inventions.
Moreover,  each Contributor shall, upon the request of Griffin, review drafts of
the registration statement to be filed the Commission and any and all amendments
thereto and furnish Griffin with such  Contributor's  comments upon and approval
of or reasons for  declining  to approve  such  portions of the drafts for which
Griffin has requested  comments and approval.  Any such portions with respect to
which a  Contributor  has not expressly  disapproved  in writing shall be deemed
approved by such  Contributor.  Griffin shall pay all  registration  expenses in
connection with any registration undertaken pursuant to this Section 6.


      7. Spin-Off. As soon as possible after the registration statement filed in
connection  with any  registration  undertaken  pursuant  to  Section 6 above is
declared  effective,  LS Capital shall declare and effect to its  stockholders a
pro-rata, in-kind dividend of the Griffin Shares registered. In this connection,
LS Capital shall deliver to each of its  stockholders  receiving the  registered
Griffin Shares an unlegended stock  certificate  representing the Griffin Shares
that  such  stockholder  is to  receive  as  well  as a copy  of the  prospectus
comprising part of the  registration  statement  declared  effective  during the
course of any registration undertaken pursuant to Section 6.

      8. Termination. If Zeotech/Hemsted,  Groves and KJM/McKenzie fails to make
the full $500,000  Additional Capital  Contribution on or before April 30, 1997,
this Agreement shall,  except as hereafter  provided,  become null and void, the
parties  hereto  shall  be  relieved  of any  further  duties,  obligations  and
responsibilities with respect to this Agreement, and the parties shall cooperate
in good faith in  unwinding  all actions  taken in  reliance on this  Agreement.
Notwithstanding  the  preceding,  the  following  actions  shall  occur upon the
termination of this Agreement pursuant to the preceding:

      (a) Each Contributor  shall deliver to LS Capital and Griffin (as the case
may be) all stock certificates representing Griffin Shares and LS Capital Shares
not theretofore sold, and such stock certificates shall be cancelled;

      (b) LS Capital may  exercise  the rights of a secured  creditor to realize
the portion of the Additional  Capital  Contribution not made in accordance with
Section 4 above;


<PAGE>

      (c) Griffin shall reconvey to each Contributor  each Claim  contributed by
such Contributor to Griffin,  such reconveyance  being by means of a document in
substantially the form of the Assignment contributing such Claim to Griffin; and

      (d) The indemnification provisions of Section 9 shall remain in full force
and effect for two years after the date of termination.

      9.    General Indemnification.

      (a) All representations and warranties made herein by a party hereto shall
survive all transactions provided for or contemplated herein, including, without
limitation,  the contribution of the Claims to Griffin, the issuance and sale of
the  Griffin  Shares  and  the  LS  Capital  Shares,   the  Additional   Capital
Contribution,  any  registration  of the Griffin  Shares  permitted in Section 6
hereof,  any spin-off of the Griffin Shares provided for in Section 7 hereof, or
the termination of this Agreement.

      (b)  Each of  Zeotech,  Hemsted,  Groves,  KJM,  McKenzie,  and  Lovelace,
severally  but not jointly,  shall  protect,  indemnify  and hold LS Capital and
Griffin harmless from any and all demands,  claims,  actions, causes of actions,
lawsuits,  proceedings,   judgments,  losses,  damages,  injuries,  liabilities,
obligations,  expenses and costs  (including  costs of litigation and attorneys'
fees), arising from any breach of any agreement, representation or warranty made
by such indemnifying party in this Agreement.

      (c) Each of LS Capital  and  Griffin,  severally  but not  jointly,  shall
protect, indemnify and hold each of Zeotech, Hemsted, Groves, KJM, McKenzie, and
Lovelace harmless from any and all demands,  claims, actions, causes of actions,
lawsuits,  proceedings,   judgments,  losses,  damages,  injuries,  liabilities,
obligations,  expenses and costs  (including  costs of litigation and attorneys'
fees), arising from any breach of any agreement, representation or warranty made
by it in this Agreement.

      10.   Securities Indemnification.

      (a)  Each of  Zeotech,  Hemsted,  Groves,  KJM,  McKenzie,  and  Lovelace,
severally  but not jointly,  shall  protect,  indemnify  and hold LS Capital and
Griffin harmless from any and all demands,  claims,  actions, causes of actions,
lawsuits,  proceedings,  investigations,  judgments,  losses, damages, injuries,
liabilities,  obligations, expenses and costs (including costs of litigation and
attorneys'  fees),  arising  out of or based  upon (a) any untrue  statement  or
alleged untrue  statement of any material fact contained in or  incorporated  by
reference  into the  registration  statement  under which the Griffin Shares are
registered pursuant to Section 6, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement  thereto,  (b) the omission or
alleged  omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading,  or (c) any material
violation by the indemnifying party of any rule or regulation  promulgated under
the Act applicable to the indemnifying  party and relating to action or inaction
by the indemnifying  party in connection with any such  registration;  provided,
however, that the indemnifying party


<PAGE>

shall be liable in the case of (a) and (b) above only if and to the extent  that
the event  giving  rise to  indemnification  arises  out of or is based  upon an
untrue  statement or alleged  untrue  statement or omission or alleged  omission
made in  conformity  with  information  furnished by the  indemnifying  party in
writing  specifically  for use in the  registration  statement or  prospectus or
information  contained in a writing that has been  expressly  approved or deemed
approved by the indemnifying party.

      (b) Each of LS Capital  and  Griffin,  severally  but not  jointly,  shall
protect, indemnify and hold each of Zeotech, Hemsted, Groves, KJM, McKenzie, and
Lovelace harmless from any and all demands,  claims, actions, causes of actions,
lawsuits,  proceedings,  investigations,  judgments,  losses, damages, injuries,
liabilities,  obligations, expenses and costs (including costs of litigation and
attorneys'  fees),  arising  out of or based  upon (a) any untrue  statement  or
alleged untrue  statement of any material fact contained in or  incorporated  by
reference  into the  registration  statement  under which the Griffin Shares are
registered pursuant to Section 6, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement  thereto,  (b) the omission or
alleged  omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading,  or (c) any material
violation by Griffin or LS Capital of any rule or regulation  promulgated  under
Act  applicable  to Griffin or LS Capital and  relating to action or inaction by
Griffin  in  connection  with any such  registration;  provided,  however,  that
Griffin  and LS  Capital  will not be liable in the case of (a) and (b) above if
and to the extent that the event otherwise giving rise to indemnification arises
out of or is based upon an untrue  statement  or  alleged  untrue  statement  or
omission or alleged omission made in conformity with information  furnished by a
person  otherwise  indemnified  hereby in  writing  specifically  for use in the
registration  statement or prospectus or information contained in a writing that
has been  expressly  approved or deemed  approved by the  otherwise  indemnified
party.

      (c) Promptly after receipt by an  indemnified  party under this Section 10
of notice of the threat or commencement of any action,  such  indemnified  party
shall, if a claim in respect thereof is to be made against an indemnifying party
hereunder,  notify  each such  indemnifying  party in writing  thereof,  but the
omission  so to notify an  indemnifying  party  shall  not  relieve  it from any
liability  which it may have to any  indemnified  party to the  extent  that the
indemnifying party is not prejudice as a result thereof. In case any such action
shall  be  brought  against  any  indemnified  party  and  it  shall  notify  an
indemnifying party of the commencement  thereof, the indemnifying party shall be
entitled  to  participate  in and,  to the extent it shall  wish,  to assume and
undertake  the defense  thereof with  counsel  reasonably  satisfactory  to such
indemnified  party,  and,  after  notice  from  the  indemnifying  party to such
indemnified  party of its  election  so to  assume  and  undertake  the  defense
thereof,  the indemnifying  party shall not be liable to such indemnified  party
under  this  Section 10 for any legal  expenses  subsequently  incurred  by such
indemnified  party in connection  with the defense thereof other than reasonable
costs of  investigation  and of  liaison  with  counsel  so  elected;  provided,
however,  that, if the defendants in any such action include both an indemnified
party and an  indemnifying  party and the related  indemnified  party shall have
reasonably concluded that there may be reasonable defenses available to it which
are different from or additional to those available to the indemnifying party or
if the interests of the indemnified party reasonably


<PAGE>

may be believed to conflict with the interests of the  indemnifying  party,  the
indemnified  party shall have the right to select separate counsel and to assume
such legal  defenses and otherwise to participate in the defense of such action,
with the expenses and fees of such separate  counsel and other expenses  related
to such participation to be reimbursed by the indemnifying party as incurred. No
indemnifying  party will be subject to any  liability  for any  settlement  made
without consent which shall not be unreasonably  withheld. No indemnifying party
will  consent to the entry of any  judgment or enter into any  settlement  which
does not include as an unconditional  term thereof the giving by the claimant or
plaintiff to such indemnified party of a release from all liability with respect
to such claim or litigation.

      11.   General.

      (a)  THIS   AGREEMENT  AND  ALL   QUESTIONS   RELATING  TO  ITS  VALIDITY,
INTERPRETATION,  PERFORMANCE, AND ENFORCEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.

      (b) Mandatory venue for any controversy arising out of or relating to this
Agreement or any  modification  or extension  thereof,  including any claims for
breach, for damages, and/or for recision or reformation,  shall be in a court of
competent jurisdiction located in Harris County, Texas.

      (c) This  Agreement  contains the entire  understanding  among the parties
hereto with respect to the subject  matter hereof and  supersedes  all prior and
contemporaneous  agreements  and  understandings,  inducements,  or  conditions,
express or implied, oral or written, except as herein contained.  This Agreement
may not be modified or amended  other than by an agreement in writing  signed by
all parties affected.

      (d)  The  express  terms  hereof  control  and  supersede  any  course  of
performance and/or usage of the trade inconsistent with any of the terms hereof.
The section  headings in this Agreement are for  convenience  only; they form no
part of this Agreement and shall not affect its interpretation.

      (e) This  Agreement may be executed in two or more  counterparts,  each of
which shall be deemed an original,  but all of which together constitute one and
the same instrument.

      (f) The parties  hereto  hereby  agree that time is of the essence for all
purposes of this Agreement.

      (g) Any notices to be given  hereunder  by any party to the other  parties
may be effected either by personal delivery in writing,  or by mail,  registered
or certified,  postage prepaid with return receipt  requested,  addressed to the
one or more  parties to be  notified at the  addresses  set forth  beneath  such
parties' respective signatures below.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


<PAGE>

     IN WITNESS  WHEREOF,  the parties hereto have signed their names hereto as
of the first date written above.

ZEOTECH INDUSTRIES, INC.

By: /S/ Ed Hemsted                                 /S/ Ed Hemsted
                                                   Ed Hemsted
Name Printed: Ed Hemsted

Title: President

Address: 155 Harwood St #1003                      Address: 155 Harwood St #1003
        ---------------------------------                  ---------------------

 Vancouver B.C V6E 1S1                             Vancouver B.C V6E 1S1

KJM CAPITAL CORP.

By:/S/ K.J. McKenzie                                 /S/ K.J. McKenzie
                                                     Keith J. McKenzie
Name Printed: Keith J. McKenzie

Title: President

Address: 1400 355 Burrand St.                     Address: 1400 355 Burrand St.
        ---------------------------------                 ---------------------

Vancouver, British Columbia                        Vancouver, British Columbia
CANADA V6C 2G8                                     CANADA V6C 2G8


 /S/Kent E. Lovelace, Jr.                          /S/W.D. Groves, PhD., P.Eng.
Kent E. Lovelace, Jr.                              W.D. Groves, PhD., P.Eng.

Address: 3300 West Beach Blvd., Suite 202          Address: 901 Jervis St. #501
        ---------------------------------             --------------------

Gulfport, Mississippi 39502                        Vancouver, British Columbia

                                                   CANADA V6E 1S1

LS CAPITAL CORPORATION                          GRIFFIN GOLD GROUP, INC.

By: /S/ Paul J. Montle                          By: /S/Randall W. Heinrich
Name Printed: Paul J Montle                     Name Printed:Randall W. Heinrich
Title: President                                Title: Secretary

Address:  15915 Katy Freeway, Suite 250         Address: 3300 West Beach Blvd., 
                                                  Suite 202 
Houston, Texas 77094                            Gulfport, Mississippi 39502
<PAGE>

                                   CERTIFICATE

      Each  of the  undersigned  hereby  certifies  and  acknowledges  that  the
undersigned  has signed and  executed  the  foregoing  agreement  with  multiple
original signature pages at separate locations to be effective  immediately upon
signing and that the transmission of a telecopier  facsimile of their respective
signatures,  each to the other, shall be sufficient to cause the mutual delivery
of this  executed  agreement in order to bind the parties and make the agreement
effective upon the date of signing.  It is further  certified,  acknowledged and
agreed that the original signature pages are to be circulated hereafter but that
the failure of any party to obtain the original  signature pages hereafter shall
not affect the validity and  effectiveness  of this agreement which is effective
from and after the execution by all parties and the  transmission  by telecopier
facsimile of the signature of all parties, each to the other.

      IN WITNESS  WHEREOF,  the parties hereto have signed their names hereto as
of the first date written above.

ZEOTECH INDUSTRIES, INC.

By: /S/ Ed Hemsted                                   /S/ Ed Hemsted
                                                              Ed Hemsted
Name Printed: Ed Hemsted

Title: President

KJM CAPITAL CORP.

By:/S/ K.J. McKenzie                                 /S/ K.J. McKenzie
                                                     Keith J. McKenzie
Name Printed: Keith J. McKenzie

Title: President


 /S/Kent E. Lovelace, Jr.                   /S/W.D. Groves, PhD., P.Eng.       
Kent E.Lovelace, Jr.                               W.D. Groves, PhD., P.Eng.

LS CAPITAL CORPORATION                    GRIFFIN GOLD GROUP, INC.

By: /S/ Paul J. Montle                    By: /S/Randall W. Heinrich
Name Printed: Paul J Montle               Name Printed:Randall W. Heinrich
                                          Title: Secretary