Document:

Exhibit 10.40

                         JOINT DISBURSEMENT INSTRUCTIONS
                          FOR CLOSING: OCTOBER 18, 2005

The undersigned do hereby:

     1. Acknowledge the acceptance of subscriptions from purchasers representing
gross proceeds of $1,150,000 from the sale of Convertible Debentures of STARTECH
ENVIRONMENTAL CORPORATION, a Colorado corporation (the "Company").

     2. Represent that all conditions precedent to closing of the Company's
offering of Convertible Debentures have been satisfied or deferred; and direct
that David Gonzalez, Esq. disburse the gross proceeds of the offering as the
joint direction of the undersigned as follows:

     To be disbursed via wire transfer in immediately available U.S. funds,
payable to the following parties:

      Gross Proceeds                                                $ 1,150,000
      Less Fees:
      To Yorkville Advisors Management
           Commitment Fee (10% of Gross Proceeds)                   $  (115,000)

Net Proceeds to the Company                                         $ 1,035,000
                                                                    -----------

STARTECH ENVIRONMENTAL                          CORNELL CAPITAL PARTNERS, LP
CORPORATION                                     By:     Yorkville Advisors, LLC
                                                Its:    General Partner

By:        /s/ Peter J. Scanlon                 By:      /s/ Mark Angelo
           --------------------                          ---------------
Name:      Peter J. Scanlon                     Name:    Mark Angelo
Its:       CFO                                  Its:     Portfolio ManagerExhibit 10.1

                                                   Revolving Line of Credit Note
                                                           dated January 3, 2006

                             MODIFICATION AGREEMENT
                             ----------------------

This Modification Agreement ("Modification  Agreement") is effective as of March
24, 2006.  The parties to the  Modification  Agreement  are Natural Gas Services
Group, Inc. ("Borrower") and Western National Bank ("Lender").

                                    RECITALS

On January 3, 2006,  Borrower  executed  and  delivered  to Lender that  certain
Revolving  Line of  Credit  Promissory  Note in the  original  principal  sum of
$10,000,000.00, bearing interest at the rate stated therein, with a stated final
maturity date of December 1, 2006 (the  "Note"),  pursuant to that certain Sixth
Amended  and  Restated  Loan   Agreement   dated  January  3,  2006  (the  "Loan
Agreement"). All liens, security interests and assignments securing the Note are
collectively called the "Liens". Terms defined in the Note or the Loan Agreement
and not otherwise  defined  herein shall have the same meanings here as in those
documents.

At  Borrower's  request,  Borrower  and  Lender  have  agreed to enter into this
Modification  Agreement  to modify the  interest  provisions  of the Note and to
ratify the Liens. Said modified interest provisions shall be effective as of the
April 1, 2006 payment.

                                    AGREEMENT

1.  Modification  of Interest  Provisions  of the Note. In lieu of the following
provisions which were contained in the first paragraph of the Note:

         "...at a rate per  annum  which  shall  from day to day be equal to the
         lesser  of (a) a rate  per  annum  (the  "Established  Rate")  equal to
         one-half of one  percent  (0.5%) over the Prime Rate in effect from day
         to day, calculated on the basis of actual days elapsed, but computed as
         if each calendar year  consisted of 360 days, or (b) the Highest Lawful
         Rate."

such provisions of the Note are changed to read in their entirety as follows:

         "...at a rate per  annum  which  shall  from day to day be equal to the
         lesser of (a) a rate per annum (the  "Established  Rate")  equal to the
         Prime Rate in effect from day to day, or (b) the Highest  Lawful  Rate,
         in each  case  calculated  on the  basis of actual  days  elapsed,  but
         computed as if each calendar year consisted of 360 days."

                                       1
<PAGE>

2.  Ratification  of Liens.  Borrower  and Lender  further  agree that all Liens
securing  the Note  shall  continue  and  carry  forward  until the Note and all
indebtedness  evidenced  thereby is paid in full.  Borrower  further agrees that
such liens are hereby ratified and affirmed as valid and subsisting  against the
collateral described therein,  and that this Modification  Agreement shall in no
manner  vitiate,  affect or impair the Note or the Liens  (except  as  expressly
modified in this  Modification  Agreement)  and that such Liens shall not in any
manner be waived, released, altered or modified.

3. Miscellaneous.

         (a)      As modified  hereby,  the provisions of the Note and the Liens
                  shall  continue  in  full  force  and  effect,   and  Borrower
                  acknowledges  and affirms its liability to Lender  thereunder.
                  In the event of an  inconsistency  between  this  Modification
                  Agreement  and the  terms  of the Note or of the  Liens,  this
                  Modification Agreement shall govern.

         (b)      Borrower hereby agrees to pay all costs and expenses  incurred
                  by Lender in connection with the execution and  administration
                  of this Modification Agreement.

         (c)      Any default by Borrower in the  performance of its obligations
                  herein contained shall constitute a default under the Note and
                  the Liens and shall allow Lender to exercise any or all of its
                  remedies  set  forth in such  Note  and  Liens or at law or in
                  equity.

         (d)      Lender  does  not,  by  its  execution  of  this  Modification
                  Agreement, waive any rights it may have against any person not
                  a party hereto.

         (e)      All terms, provisions,  covenants,  agreements, and conditions
                  of the Note and the Liens are  unchanged,  except as  provided
                  herein.  Borrower agrees that this Modification  Agreement and
                  all of the covenants and agreements  contained herein shall be
                  binding upon Borrower and shall inure to the benefit of Lender
                  and  each  of  their  respective   heirs,   executors,   legal
                  representatives, successors, and permitted assigns.

                  THIS  MODIFICATION  AGREEMENT  REPRESENTS THE FINAL  AGREEMENT
                  BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
                  PRIOR,  CONTEMPORANEOUS,  OR SUBSEQUENT ORAL AGREEMENTS OF THE
                  PARTIES.  THERE ARE NO UNWRITTEN ORAL  AGREEMENTS  BETWEEN THE
                  PARTIES.

                                       2
<PAGE>

                                     Borrower:

                                     Natural Gas Services Group, Inc.

                                     By: /s/ Stephen C. Taylor
                                        ----------------------------------------
                                        Stephen C. Taylor, President

                                     Lender:

                                     Western National Bank

                                     By /s/ Scott A. Lovett
                                       -----------------------------------------
                                       Scott A. Lovett, Executive Vice President

STATE OF TEXAS             ss.
                           ss.
COUNTY OF MIDLAND          ss.

         This  instrument  was  acknowledged  before  me on March 31,  2006,  by
Stephen C. Taylor,  President of Natural Gas  Services  Group,  Inc., a Colorado
corporation, on behalf of said corporation.

                                       -----------------------------------------
                                       Notary Public, State of Texas

STATE OF TEXAS             ss.
                           ss.
COUNTY OF MIDLAND          ss.

         This instrument was acknowledged  before me on March 31, 2006, 2006, by
Scott A. Lovett,  Executive Vice President of Western  National Bank, a national
banking association, on behalf of said association.

                                       -----------------------------------------
                                       Notary Public, State of Texas

                                       3Exhibit 10.2

                                                         $8,000,000.00 Term Note
                                                           dated January 3, 2005

                          SECOND MODIFICATION AGREEMENT
                          -----------------------------

This  Second  Modification   Agreement  ("Second  Modification   Agreement")  is
effective as of March 24, 2006. The parties to the Second Modification Agreement
are Natural Gas Services  Group,  Inc.  ("Borrower")  and Western  National Bank
("Lender").

                                    RECITALS

On January 3, 2005,  Borrower executed and delivered to Lender that certain Term
Promissory Note in the original principal sum of $8,000,000.00, bearing interest
at the rate stated  therein,  with a stated  final  maturity  date of January 1,
2012,  as modified in  Modification  Agreement  dated May 1, 2005 (the  "Note"),
pursuant to that certain Third Amended and Restated Loan Agreement dated January
3, 2005,  as amended and  restated in that certain  Fourth  Amended and Restated
Loan Agreement dated March 14, 2005, as modified in First Modification to Fourth
Amended and Restated Loan Agreement  dated May 1, 2005, and further  amended and
restated in Fifth Amended and Restated Loan Agreement  dated September 26, 2005,
and further  amended and restated in Sixth Amended and Restated  Loan  Agreement
dated January 3, 2006 (the "Loan Agreement").  All liens, security interests and
assignments securing the Note are collectively called the "Liens". Terms defined
in the Note or the Loan  Agreement and not otherwise  defined  herein shall have
the same meanings here as in those documents.

At Borrower's request, Borrower and Lender have agreed to enter into this Second
Modification  Agreement  to modify the  interest  provisions  of the Note and to
ratify the Liens. Said modified interest provisions shall be effective as of the
April 1, 2006 payment.

                                    AGREEMENT

1.  Modification  of Interest  Provisions  of the Note. In lieu of the following
provisions which were contained in the first paragraph of the Note:

         "...at a rate per  annum  which  shall  from day to day be equal to the
         lesser of (a) a rate per annum (the  "Established  Rate")  equal to the
         greater of (i)  one-half  percent  (0.5%) over the Prime Rate in effect
         from day to day, or (ii) six percent (6.0%),  or (b) the Highest Lawful
         Rate, in each case calculated on the basis of actual days elapsed,  but
         computed as if each calendar year consisted of 360 days."

such provisions of the Note are changed to read in their entirety as follows:

         "...at a rate per  annum  which  shall  from day to day be equal to the
         lesser of (a) a rate per annum (the  "Established  Rate")  equal to the
         Prime Rate in effect from day to day, or (b) the Highest  Lawful  Rate,
         in each  case  calculated  on the  basis of actual  days  elapsed,  but
         computed as if each calendar year consisted of 360 days."

                                       1
<PAGE>

2.  Ratification  of Liens.  Borrower  and Lender  further  agree that all Liens
securing  the Note  shall  continue  and  carry  forward  until the Note and all
indebtedness  evidenced  thereby is paid in full.  Borrower  further agrees that
such liens are hereby ratified and affirmed as valid and subsisting  against the
collateral described therein, and that this Second Modification  Agreement shall
in no  manner  vitiate,  affect  or  impair  the Note or the  Liens  (except  as
expressly  modified in this Second  Modification  Agreement) and that such Liens
shall not in any manner be waived, released, altered or modified.

3. Miscellaneous.

         (a)      As modified  hereby,  the provisions of the Note and the Liens
                  shall  continue  in  full  force  and  effect,   and  Borrower
                  acknowledges  and affirms its liability to Lender  thereunder.
                  In  the  event  of  an   inconsistency   between  this  Second
                  Modification  Agreement  and the  terms  of the Note or of the
                  Liens, this Second Modification Agreement shall govern.

         (b)      Borrower hereby agrees to pay all costs and expenses  incurred
                  by Lender in connection with the execution and  administration
                  of this Second Modification Agreement.

         (c)      Any default by Borrower in the  performance of its obligations
                  herein contained shall constitute a default under the Note and
                  the Liens and shall allow Lender to exercise any or all of its
                  remedies  set  forth in such  Note  and  Liens or at law or in
                  equity.

         (d)      Lender does not, by its execution of this Second  Modification
                  Agreement, waive any rights it may have against any person not
                  a party hereto.

         (e)      All terms, provisions,  covenants,  agreements, and conditions
                  of the Note and the Liens are  unchanged,  except as  provided
                  herein.   Borrower   agrees  that  this  Second   Modification
                  Agreement and all of the covenants  and  agreements  contained
                  herein shall be binding  upon  Borrower and shall inure to the
                  benefit  of  Lender  and  each  of  their  respective   heirs,
                  executors,  legal representatives,  successors,  and permitted
                  assigns.

                  THIS  SECOND  MODIFICATION   AGREEMENT  REPRESENTS  THE  FINAL
                  AGREEMENT  BETWEEN THE PARTIES AND MAY NOT BE  CONTRADICTED BY
                  EVIDENCE  OF  PRIOR,   CONTEMPORANEOUS,   OR  SUBSEQUENT  ORAL
                  AGREEMENTS  OF  THE  PARTIES.  THERE  ARE  NO  UNWRITTEN  ORAL
                  AGREEMENTS BETWEEN THE PARTIES.

                                       2
<PAGE>

                                    Borrower:
                                    ---------

                                    Natural Gas Services Group, Inc.

                                    By: /s/ Stephen C. Taylor
                                       -----------------------------------------
                                       Stephen C. Taylor, President

                                    Lender:
                                    -------

                                    Western National Bank

                                    By: /s/ Scott A. Lovett
                                       -----------------------------------------
                                       Scott A. Lovett, Executive Vice President

STATE OF TEXAS             ss.
                           ss.
COUNTY OF MIDLAND          ss.

         This  instrument  was  acknowledged  before  me on March 31,  2006,  by
Stephen C. Taylor,  President of Natural Gas  Services  Group,  Inc., a Colorado
corporation, on behalf of said corporation.

                                       -----------------------------------------
                                       Notary Public, State of Texas

STATE OF TEXAS             ss.
                           ss.
COUNTY OF MIDLAND          ss.

         This instrument was acknowledged  before me on March 31, 2006, by Scott
A. Lovett, Executive Vice President of Western National Bank, a national banking
association, on behalf of said association.

                                       -----------------------------------------
                                       Notary Public, State of Texas

                                       3

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