Mr. David J. Wolenski
October 17, 1996
Page 3






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                      PROMISSORY NOTE EXTENSION


                        October 17, 1996


Mr. David J. Wolenski
President and Chief Executive Officer
Ozo Diversified Automation, Inc.
7450 East Jewell Avenue
Suite A
Denver, Colorado 80231

Dear David:

      As  you are aware, Ozo Diversified Automation, Inc. ("Ozo")
borrowed  $100,000.00, in the aggregate, from the undersigned  as
evidenced  by Promissory Notes dated April 1, 1996 (collectively,
the  "Notes").  The principal sum of the Notes, with all  accrued
interest,  became due on September 30, 1996.  Ozo was  unable  to
pay  the Notes.  In consideration for the undersigned not  making
demand  on  the  Notes, and exercising any and all  legal  rights
available to them with respect to such Notes and other  good  and
valuable  consideration, the receipt and sufficiency of which  is
hereby acknowledged, Ozo and the undersigned agree as follows:

     1.   Ozo has, or will pay, all accrued and unpaid interest due
          with respect to the Notes.

     2.   As of this date, the Notes will bear interest, until paid in
          full, at 12% per annum.

     3.   The entire principal sum, with all accrued interest, on the
          Notes, shall be due on or before October 30, 1996.

     4.   Ozo will arrange to have issued to the undersigned Common
          Stock Purchase Warrants to purchase an aggregate of 15,000 shares
          of the Company's common stock, $.10 par value per share (the
          "Common Stock").  The Basic Exercise Price (as defined in the
          Common Stock Purchase Warrants) shall be $.75 per share, the
          market price of such Common Stock on October 1, 1996.

     5.   Ozo shall cause each of the Company's directors, other than
          David W. Orthman and David J. Wolenski, to resign from the
          Company's Board of Directors.  The remaining directors shall
          appoint as replacements Al Katz and Scott Salpeter, such that the
          Board of Directors of the Company shall consist of Al Katz, Scott
          Salpeter, David W. Orthman and David J. Wolenski, with Al Katz
          being the Chairman of the Board of Directors.  Management of Ozo
          will arrange to have each of Ozo's directors, officers, and
          principal shareholders who are not directors and officers of Ozo,
          sign letter agreements agreeing to vote any and all shares of the
          Company's Common Stock owned by them in favor of Mr. Salpeter and
          Mr. Katz serving as directors of the Company, from the date
          hereof until October 10, 1997.  At the discretion of the Board of
          Directors, a fifth director may be appointed provided the
          appointment of such director is approved by three of the four
          members of the Board of Directors.


      Assuming this letter accurately memorializes the  terms  of
our  Agreement, please acknowledge your agreement below.   Please
return   five  (5)  copies  of  the  signed  Agreement   to   the
undersigned, along with the signed Common Stock Purchase Warrants
which are attached hereto.

                                   Sincerely yours,




James S. Cassel                    Steven N. Bronson




Bruce C. Barber                    Lenore Katz



                                   Eric R. Elliott

ACKNOWLEDGED and AGREED as
of October 10, 1996.

OZO DIVERSIFIED AUTOMATION, INC.



By:
  David J. Wolenski, President and Chief
  Executive Officer