Document:

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                                                                    Exhibit 10.8

                                ESCROW AGREEMENT

     ESCROW AGREEMENT (the "Escrow Agreement") made as of the 19th day of March,
2004, by and among Aquatic Cellulose International Corp., a Nevada corporation
(the "Company"), the Purchasers listed on Schedule A attached hereto (each a
"Purchaser" and collectively, the "Purchasers") and Owen Naccarato (the "Escrow
Agent").

                                   WITNESSETH:

     WHEREAS, the Company desires to raise capital in order to finance the
growth of its business operations and for other general corporate purposes;

     WHEREAS, the Company and the Purchasers have agreed that, in order to raise
capital, the Company shall issue and sell to the Purchasers debentures (the
"Debentures"), convertible into shares of the Company's common stock, $0.001 par
value per share (the "Common Stock"), and Warrants to purchase shares of Common
Stock (the "Warrants") for an aggregate purchase price of $900,000;

     WHEREAS, the Company has entered into a Securities Purchase Agreement dated
as of March 19, 2004 (the "Purchase Agreement") with the Purchasers;

     WHEREAS, the parties have agreed that all funds shall be paid into escrow
and the Escrow Agent has agreed to receive, hold and pay such funds, upon the
terms and subject to the conditions hereinafter set forth.

     NOW, THEREFORE, in consideration of the mutual covenants herein contained,
and for other good and valuable consideration, the receipt and legal sufficiency
of which is hereby acknowledged, the parties to this Escrow Agreement hereby
agree as follows:

     1. Defined Terms. Capitalized terms used and not otherwise defined herein
shall have the meanings respectively assigned to them in the Purchase Agreement.

     2. Escrow of Funds. On the Closing Date (as defined in the Purchase
Agreement), the following shall occur: the Purchasers shall remit by wire
transfer the Purchase Price to the Escrow Agent pursuant to this Escrow
Agreement as payment in full for the Debentures and the Warrants (the "Escrow
Amount"). The Escrow Agent shall hold the Escrow Amount only in accordance with
the terms and conditions of this Escrow Agreement.

     3. Investment of Funds. The Escrow Agent shall invest the monies in the
Escrow Amount in an interest bearing bank account with, or certificates of
deposit or time deposits with, maturities of no more than thirty (30) days
issued by, a domestic commercial bank or such other bank or other financial
institution as it normally holds such funds.

     4. Release of Funds. The Escrow Agent shall release the Escrow Amount, or a
portion thereof, upon receipt, at any time, of joint written instructions from
the Company and the Purchasers directing the manner in which the distribution of
the Escrow Amount, or a portion thereof, is to be made, provided that upon the
earlier to occur of (a) one hundred eighty (180) days from the date hereof or
(b) the date upon which each of the Purchasers ceases to transact business, the
Escrow

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Agent shall release the Escrow Amount upon receipt of written instructions from
the Company directing the manner in which the distribution of the Escrow Amount,
or a portion thereof, is to be made.

     5. Further Assurances. The Company and the Purchasers agree to do such
further acts and to execute and deliver such statements, assignments,
agreements, instruments and other documents as the Escrow Agent from time to
time reasonably may request in connection with the administration, maintenance,
enforcement or adjudication of this Escrow Agreement in order (a) to give the
Escrow Agent confirmation and assurance of the Escrow Agent's rights, powers,
privileges, remedies and interests under this Escrow Agreement and applicable
law, (b) to better enable the Escrow Agent to exercise any such right, power,
privilege, remedy or interest, or (c) to otherwise effectuate the purpose and
the terms and provisions of this Escrow Agreement, each in such form and
substance as may be reasonably acceptable to the Escrow Agent.

     6. Conflicting Demands. If conflicting or adverse claims or demands are
made or notices served upon the Escrow Agent with respect to the escrow provided
for herein, the Company and the Purchasers agree that the Escrow Agent shall
refuse to comply with any such claim or demand and withhold and stop all further
performance of this escrow so long as such disagreement shall continue. In so
doing, the Escrow Agent shall not be or become liable for damages, losses,
costs, expenses or interest to any or any other person for its failure to comply
with such conflicting or adverse demands. The Escrow Agent shall be entitled to
continue to so refrain and refuse to so act until such conflicting claims or
demands shall have been finally determined by a court or arbitrator of competent
jurisdiction or shall have been settled by agreement of the parties to such
controversy, in which case the Escrow Agent shall be notified thereof in a
notice signed by such parties. The Escrow Agent may also elect to commence an
interpleader or other action for declaratory judgment for the purpose of having
the respective rights of the claimants adjudicated, and may deposit with the
court all funds held hereunder pursuant to this Escrow Agreement; and if it so
commences and deposits, the Escrow Agent shall be relieved and discharged from
any further duties and obligations under this Escrow Agreement.

     7. Disputes. Each of the parties hereto hereby covenants and agrees that
the Federal or state courts located in the Borough of Manhattan, State of New
York shall have jurisdiction over any dispute with the Escrow Agent or relating
to this Escrow Agreement.

     8. Expenses of the Escrow Agent. The Company agrees to pay any and all
out-of-pocket costs and expenses incurred by the Escrow Agent in connection with
all waivers, releases, discharges, satisfactions, modifications and amendments
of this Escrow Agreement, the administration and holding of the Escrow Amount
and the investment of such funds, and the enforcement, protection and
adjudication of the Escrow Agent's rights hereunder by the Escrow Agent,
including, without limitation, the out-of-pocket disbursements of the Escrow
Agent itself and expenses and costs of other attorneys it may retain, if any.
The Company shall be liable to the Escrow Agent for any expenses payable by the
Escrow Agent.

     9. Reliance on Documents and Experts. The Escrow Agent shall be entitled to
rely upon any notice, consent, certificate, affidavit, statement, paper,
document, writing or communication (which to the extent permitted hereunder may
be by telegram, cable, telex, telecopier, or telephone) reasonably believed by
it to be genuine and to have been signed, sent or made by the proper person

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or persons, and upon opinions and advice of legal counsel (including itself or
counsel for any party hereto), independent public accountants and other experts
selected by the Escrow Agent and mutually acceptable to each of the Company and
the Purchasers. The Escrow Agent shall not be responsible to review the
Certificate other than to confirm that it has been signed or to determine the
clearance of checks received for the Escrow Amount.

     10. Status of the Escrow Agent, Etc. The Escrow Agent is acting under this
Escrow Agreement as a stakeholder only. No term or provision of this Escrow
Agreement is intended to create, nor shall any such term or provision be deemed
to have created, any joint venture, partnership or attorney-client relationship
between or among the Escrow Agent and the Company or the Purchasers. This Escrow
Agreement shall not be deemed to prohibit or in any way restrict the Escrow
Agent's representation of the Company, who may be advised by the Escrow Agent on
any and all matters pertaining to this Escrow Agreement. To the extent the
Purchasers have been represented by the Escrow Agent, the Purchasers hereby
waive any conflict of interest and irrevocably authorize and direct the Escrow
Agent to carry out the terms and provisions of this Escrow Agreement fairly as
to all parties, without regard to any such representation and irrespective of
the impact upon the Purchasers. The Escrow Agent's only duties are those
expressly set forth in this Escrow Agreement, and each of the Company and the
Purchasers authorize the Escrow Agent to perform those duties in accordance with
its usual practices in holding funds of its own or those of other escrows. The
Escrow Agent may exercise or otherwise enforce any of its rights, powers,
privileges, remedies and interests under this Escrow Agreement and applicable
law or perform any of its duties under this Escrow Agreement by or through its
partners, employees, attorneys, agents or designees.

     11. Exculpation. The Escrow Agent and its designees, and their respective
partners, employees, attorneys and agents, shall not incur any liability
whatsoever for the investment or disposition of funds or the taking of any other
action in accordance with the terms and provisions of this Escrow Agreement, for
any mistake or error in judgment, for compliance with any applicable law or any
attachment, order or other directive of any court or other authority
(irrespective of any conflicting term or provision of this Escrow Agreement), or
for any act or omission of any other person selected with reasonable care and
engaged by the Escrow Agent in connection with this Escrow Agreement (other than
for such Escrow Agent's or such person's own acts or omissions breaching a duty
owed to the claimant under this Escrow Agreement and amounting to gross
negligence or willful misconduct as finally determined pursuant to applicable
law by a governmental authority having jurisdiction); and each of the Company
and the Purchasers hereby waive any and all claims and actions whatsoever
against the Escrow Agent and its designees, and their respective partners,
employees, attorneys and agents, arising out of or related directly or
indirectly to any and all of the foregoing acts, omissions and circumstances.
Furthermore, the Escrow Agent and its designees, and their respective partners,
employees, attorneys and agents, shall not incur any liability (other than for a
person's own acts or omissions breaching a duty owed to the claimant under this
Escrow Agreement and amounting to willful misconduct as finally determined
pursuant to applicable law by a governmental authority having jurisdiction) for
other acts and omissions arising out of or related directly or indirectly to
this Escrow Agreement or the Escrow Amount; and each of the Company and the
Purchasers hereby expressly waive any and all claims and actions (other than
those attributable to a person's own acts or omissions breaching a duty owed to
the claimant and amounting to gross negligence or willful misconduct as finally
determined pursuant to applicable law by a governmental authority having
jurisdiction) against the Escrow Agent and its designees,

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and their respective partners, employees, attorneys and agents, arising out of
or related directly or indirectly to any and all of the foregoing acts,
omissions and circumstances. The Escrow Agent's designees excludes the
Purchasers for purposes hereof.

     12. Indemnification. The Escrow Agent and its designees (excluding the
Purchasers), and their respective partners, employees, attorneys and agents,
shall be indemnified, reimbursed, held harmless and, at the request of the
Escrow Agent, defended, by the Company from and against any and all claims,
liabilities, losses and expenses (including, without limitation, the reasonable
disbursements, expenses and fees of their respective attorneys) that may be
imposed upon, incurred by, or asserted against any of them, arising out of or
related directly or indirectly to this Escrow Agreement or the Escrow Amount,
except such as are occasioned by the indemnified person's own acts and omissions
breaching a duty owed to the claimant under this Escrow Agreement and amounting
to willful misconduct as finally determined pursuant to applicable law by a
governmental authority having jurisdiction.

     13. Notices. Any notice, request, demand or other communication permitted
or required to be given hereunder shall be in writing, shall be sent by one of
the following means to the addressee at the address set forth below (or at such
other address as shall be designated hereunder by notice to the other parties
and persons receiving copies, effective upon actual receipt) and shall be deemed
conclusively to have been given: (a) on the first business day following the day
timely deposited with Federal Express (or other equivalent national overnight
courier) or United States Express Mail, with the cost of delivery prepaid; (b)
on the fifth business day following the day duly sent by certified or registered
United States mail, postage prepaid and return receipt requested; or (c) when
otherwise actually delivered to the addressee.

               If to the Company:     Aquatic Cellulose International Corp.
                                      2504 43rd Street
                                      Suite 5
                                      Vernon, British Columbia
                                      Canada VIT 6L1
                                      Attention: President and Chief Executive
                                      Officer
                                      Telephone: 250-558-4216
                                      Facsimile: 250-558-3846

               with a copy to:        Owen Naccarato, Esq.
                                      Naccarato & Associates
                                      19600 Fairchild, Suite 260
                                      Irvine, CA 92612
                                      Telephone: (949) 851-9261
                                      Facsimile: (949) 851-9262

               If to any Purchaser:   At the address of such Purchaser set forth
                                      on Schedule A to the Escrow Agreement,
                                      with copies to such Purchaser's counsel as
                                      set forth on Schedule A or as specified in
                                      writing by such Purchaser.

                                       4

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               If to the Escrow       Owen Naccarato, Esq.
               Agent:                 Naccarato & Associates
                                      19600 Fairchild, Suite 260
                                      Irvine, CA 92612
                                      Telephone: (949) 851-9261
                                      Facsimile: (949) 851-9262

     14. Section and Other Headings. The section and other headings contained in
this Escrow Agreement are for convenience only, shall not be deemed a part of
this Escrow Agreement and shall not affect the meaning or interpretation of this
Escrow Agreement.

     15. Governing Law. This Escrow Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of New York,
without regard to principles of conflicts of law. Each of the Company and the
Purchasers (i) hereby irrevocably submit to the jurisdiction of the United
States District Court sitting in the Southern District of New York for the
purposes of any suit, action or proceeding arising out of or relating to this
Agreement or the Purchase Agreement and (ii) hereby waive, and agree not to
assert in any such suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of such court, that the suit, action or
proceeding is brought in an inconvenient forum or that the venue of the suit,
action or proceeding is improper. Each of the Company and the Purchasers consent
to process being served in any such suit, action or proceeding by mailing a copy
thereof to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing in this Section 15 shall affect
or limit any right to serve process in any other manner permitted by law.

     16. Counterparts. This Escrow Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original but all such counterparts shall together constitute one and
the same agreement.

     17. Resignation of Escrow Agent. The Escrow Agent may, at any time, at its
option, elect to resign its duties as Escrow Agent under this Escrow Agreement
by providing notice thereof to each of the Company and the Purchasers. In such
event, the Escrow Agent shall deposit the Escrow Amount with a successor
independent escrow agent to be appointed by (a) the Company and the Purchasers
within thirty (30) days following the receipt of notice of resignation from the
Escrow Agent, or (b) the Escrow Agent if the Company and the Purchasers shall
have not agreed on a successor escrow agent within the aforesaid 30-day period,
upon which appointment and delivery of the Escrow Amount the Escrow Agent shall
be released of and from all liability under this Escrow Agreement.

     18. Successors and Assigns; Assignment. Whenever in this Escrow Agreement
reference is made to any party, such reference shall be deemed to include the
successors, assigns and legal representatives of such party, and, without
limiting the generality of the foregoing, all representations, warranties,
covenants and other agreements made by or on behalf of each of the Company and
the Purchasers in this Escrow Agreement shall inure to the benefit of any
successor escrow agent hereunder; provided, however, that nothing herein shall
be deemed to authorize or permit the Company or the Purchasers to assign any of
its rights or obligations hereunder to any

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other person (whether or not an affiliate of the Company or the Purchasers)
without the written consent of each of the other parties nor to authorize or
permit the Escrow Agent to assign any of its duties or obligations hereunder
except as provided in Section 17 hereof.

     19. No Third Party Rights. The representations, warranties and other terms
and provisions of this Escrow Agreement are for the exclusive benefit of the
parties hereto, and no other person, including the creditors of the Company or
the Purchasers, shall have any right or claim against any party by reason of any
of those terms and provisions or be entitled to enforce any of those terms and
provisions against any party.

     20. No Waiver by Action, Etc. Any waiver or consent respecting any
representation, warranty, covenant or other term or provision of this Escrow
Agreement shall be effective only in the specific instance and for the specific
purpose for which given and shall not be deemed, regardless of frequency given,
to be a further or continuing waiver or consent. The failure or delay of a party
at any time or times to require performance of, or to exercise its rights with
respect to, any representation, warranty, covenant or other term or provision of
this Escrow Agreement in no manner (except as otherwise expressly provided
herein) shall affect its right at a later time to enforce any such term or
provision. No notice to or demand on either the Company or the Purchasers in any
case shall entitle such party to any other or further notice or demand in the
same, similar or other circumstances. All rights, powers, privileges, remedies
and interests of the parties under this Escrow Agreement are cumulative and not
alternatives, and they are in addition to and shall not limit (except as
otherwise expressly provided herein) any other right, power, privilege, remedy
or interest of the parties under this Escrow Agreement or applicable law.

     21. Modification, Amendment, Etc. Each and every modification and amendment
of this Escrow Agreement shall be in writing and signed by all of the parties
hereto, and each and every waiver of, or consent to any departure from, any
covenant, representation, warranty or other provision of this Escrow Agreement
shall be in writing and signed by the party granting such waiver or consent.

     22. Entire Agreement. This Escrow Agreement contains the entire agreement
of the parties with respect to the matters contained herein and supersedes all
prior representations, agreements and understandings, oral or otherwise, among
the parties with respect to the matters contained herein.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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     IN WITNESS WHEREOF, the parties hereto have executed this Escrow Agreement
on the date first written above.

                                        AQUATIC CELLULOSE INTERNATIONAL CORP.

                                        By: /s/ Sheridan Westgarde
                                            ------------------------------------
                                            Sheridan B. Westgarde
                                            President and Chief Executive
                                            Officer

                                        By:
                                            ------------------------------------
                                            Owen Naccarato, as escrow agent

                                        AJW PARTNERS, LLC
                                        By: SMS Group, LLC

                                        By:
                                            ------------------------------------
                                            Corey S. Ribotsky
                                            Manager

                                        AJW OFFSHORE, LTD.
                                        By: First Street Manager II, LLC

                                        By:
                                            ------------------------------------
                                            Corey S. Ribotsky
                                            Manager

                                        AJW QUALIFIED PARTNERS, LLC
                                        By: AJW Manager, LLC

                                        By:
                                            ------------------------------------
                                            Corey S. Ribotsky
                                            Manager

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                                   SCHEDULE A

NAMES AND ADDRESS OF PURCHASERS

AJW Partners, LLC
AJW Offshore, Ltd.
AJW Qualified Partners, LLC
1044 Northern Boulevard
Suite 302
Roslyn, New York 11576
Attn: Corey Ribotsky<PAGE>
                                                                    Exhibit 10.9

                           GUARANTY AND PLEDGE AGREEMENT

          GUARANTY AND PLEDGE AGREEMENT (this "Agreement"), dated as of March
19, 2004, among Aquatic Cellulose International Corp., a Nevada corporation (the
"Company"), Sheridan B. Westgarde (the "Pledgor"), AJW Partners, LLC, a limited
liability company ("AJW"), AJW Offshore, Ltd., a limited liability company
("Offshore"), and AJW Qualified Partners, LLC, a limited liability company
("Qualified"), New Millennium Capital Partners II, LLC ("New Millennium" and,
together with AJW, Offshore and Qualified, the "Pledgees").

                                   WITNESSETH:

          WHEREAS, the Company and the Pledgees are parties to that certain
Securities Purchase Agreement, of even date herewith (the "Purchase Agreement"),
pursuant to which the Company (i) has issued (a) 10% secured convertible
debentures in the aggregate principal amount of $900,000 and (b) stock purchase
warrants to purchase an aggregate of 900,000 shares of the Company's common
stock, $.001 par value per share (the "Common Stock"); and

          WHEREAS, as a material inducement to the Pledgees to enter into the
Purchase Agreement, the Pledgees have required and the Pledgor has agreed (i) to
unconditionally guarantee the timely and full satisfaction of all obligations of
the Company, whether matured or unmatured, now or hereafter existing or created
and becoming due and payable (the "Obligations") to the Pledgees, their
successors, endorsees, transferees or assigns under the Transaction Documents
(as defined in the Purchase Agreement) to the extent of the Collateral (as
defined in Section 5 hereof), and (ii) to grant to the Pledgees, their
successors, endorsees, transferees or assigns a security interest in the number
of shares of Common Stock currently owned by the Pledgor as set forth below the
Pledgor's signature on the signature page hereto (collectively, the "Shares"),
as collateral security for Obligations. Terms used and not defined herein shall
have the meaning ascribed to them in the Purchase Agreement.

          NOW, THEREFORE, in consideration of the foregoing recitals, and the
mutual covenants contained herein, the parties hereby agree as follows:

          1. Guaranty. To the extent of the Collateral, the Pledgor hereby
absolutely, unconditionally and irrevocably guarantees to the Pledgees, their
successors, endorsees, transferees and assigns the due and punctual performance
and payment of the Obligations owing to the Pledgees, their successors,
endorsees, transferees or assigns when due, all at the time and place and in the
amount and manner prescribed in, and otherwise in accordance with, the
Transaction Documents, regardless of

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any defense or set-off counterclaim which the Company or any other person may
have or assert, and regardless of whether or not the Pledgees or anyone on
behalf of the Pledgees shall have instituted any suit, action or proceeding or
exhausted its remedies or taken any steps to enforce any rights against the
Company or any other person to compel any such performance or observance or to
collect all or part of any such amount, either pursuant to the provisions of the
Transaction Documents or at law or in equity, and regardless of any other
condition or contingency. The Pledgor shall have no obligation whatsoever to the
Pledgees beyond the Collateral pledged for the Obligations set forth herein.

          2. Waiver of Demand. The Pledgor hereby unconditionally: (i) waives
any requirement that the Pledgees, in the event of a breach in any material
respect by the Company of any of its representations or warranties in the
Transaction Documents, first make demand upon, or seek to enforce remedies
against, the Company or any other person before demanding payment of enforcement
hereunder; (ii) covenants that this Agreement will not be discharged except by
complete performance of all the Obligations to the extent of the Collateral;
(iii) agrees that this Agreement shall remain in full force and effect without
regard to, and shall not be affected or impaired, without limitation, by, any
invalidity, irregularity or unenforceability in whole or in part of the
Transaction Documents or any limitation on the liability of the Company
thereunder, or any limitation on the method or terms of payment thereunder which
may now or hereafter be caused or imposed in any manner whatsoever; and (iv)
waives diligence, presentment and protest with respect to, and notice of default
in the performance or payment of any Obligation by the Company under or in
connection with the Transaction Documents.

          3. Release. The obligations, covenants, agreements and duties of the
Pledgor hereunder shall not be released, affected or impaired by any assignment
or transfer, in whole or in part, of the Transaction Documents or any
Obligation, although made without notice to or the consent of the Pledgor, or
any waiver by the Pledgees, or by any other person, of the performance or
observance by the Company or the Pledgor of any of the agreements, covenants,
terms or conditions contained in the Transaction Documents, or any indulgence in
or the extension of the time or renewal thereof, or the modification or
amendment (whether material or otherwise), or the voluntary or involuntary
liquidation, sale or other disposition of all or any portion of the stock or
assets of the Company or the Pledgor, or any receivership, insolvency,
bankruptcy, reorganization, or other similar proceedings, affecting the Company
or the Pledgor or any assets of the Company or the Pledgor, or the release of
any proper from any security for any Obligation, or the impairment of any such
property or security, or the release or discharge of the Company or the Pledgor
from the performance or observance of any agreement, covenant, term or condition
contained in or arising out of the Transaction Documents by operation of law, or
the merger or consolidation of the Company, or any other cause, whether similar
or dissimilar to the foregoing.

          4. Subrogation.

               (a) Unless and until complete performance of all the Obligations
to the extent of the Collateral, the Pledgor shall not be entitled to exercise
any right of subrogation to any of the rights of the Pledgees against the
Company or any collateral security or guaranty held by the Pledgees for the
payment or performance of the Obligations, nor shall the Pledgor seek any
reimbursement from the Company in respect of payments made by the Pledgor
hereunder.

               (b) In the extent that the Pledgor shall become obligated to
perform or pay any sums hereunder, or in the event that for any reason the
Company is now or shall hereafter become indebted to the Pledgor, the amount of
such sum shall at all times be subordinate as to lien, time of payment and in
all other respects, to the amounts owing to the Pledgees under the Transaction
Documents and the Pledgor shall not enforce or receive payment

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<PAGE>

thereof until all Obligations due to the Pledgees under the Transaction have
been performed or paid. Nothing herein contained is intended or shall be
construed to give to the Pledgor any right of subrogation in or under the
Transaction Documents, or any right to participate in any way therein, or in any
right, title or interest in the assets of the Pledgees.

          5. Security. As collateral security for the punctual payment and
performance, when due, by the Company of all the Obligations, the Pledgor hereby
pledges with, hypothecates, transfers and assigns to the Pledgees all of the
Shares and all proceeds, shares and other securities received, receivable or
otherwise distributed in respect of or in exchange for the Shares, including,
without limitation, any shares and other securities into which such Shares may
be convertible or exchangeable (collectively, the "Additional Collateral" and
together with the Shares, the "Collateral"). Simultaneously herewith, the
Pledgor shall deliver to the Pledgees the certificate(s) representing the
Shares, stamped with a bank medallion guarantee, along with a stock transfer
power duly executed in blank by the Pledgor, to be held by the Pledgees as
security. Any Collateral received by the Pledgor on or after the date hereof
shall be immediately delivered to the Pledgees together with any executed stock
powers or other transfer documents requested by the Pledgees, which request may
be made at any time prior to the date when the Obligations shall have been paid
and otherwise satisfied in full.

          6. Voting Power, Dividends, Etc. and other Agreements.

               (a) Unless and until an Event of Default (as set forth in Section
7 hereof) has occurred, the Pledgor shall be entitled to:

                    (i) Exercise all voting and/or consensual powers pertaining
          to the Collateral, or any part thereof, for all purposes;

                    (ii) Receive and retain dividends paid with respect to the
          Collateral; and

                    (iii) Receive the benefits of any income tax deductions
          available to the Pledgor as a shareholder of the Company.

               (b) The Pledgor agrees that it will not sell, assign, transfer,
pledge, hypothecate, encumber or otherwise dispose of the Collateral.

               (c) The Pledgor and the Company jointly and severally agree to
pay all costs including all reasonable attorneys' fees and disbursements
incurred by the Pledgees in enforcing this Agreement in accordance with its
terms.

          7. Default and Remedies.

               (a) For the purposes of this Agreement, "Event of Default" shall
mean:

                    (i) default in or under any of the Obligations after the
          expiration, without cure, of any applicable cure period;

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<PAGE>

                    (ii) a breach in any material respect by the Company of any
          of its representations or warranties in the Transaction Documents; or

                    (iii) a breach in any material respect by the Pledgor of any
          of its representations or warranties in this Agreement.

               (b) the Pledgees shall have the following rights upon any Event
of Default:

                    (i) the rights and remedies provided by the Uniform
          Commercial Code as adopted by the State of New York (the "UCC") (as
          said law may at any time be amended);

                    (ii) the right to receive and retain all dividends, payments
          and other distributions of any kind upon any or all of the Collateral;

                    (iii) the right to cause any or all of the Collateral to be
          transferred to its own name or to the name of its designee and have
          such transfer recorded in any place or places deemed appropriate by
          the Pledgees; and

                    (iv) the right to sell, at a public or private sale, the
          Collateral or any part thereof for cash, upon credit or for future
          delivery, and at such price or prices in accordance with the UCC (as
          such law may be amended from time to time). Upon any such sale the
          Pledgees shall have the right to deliver, assign and transfer to the
          purchaser thereof the Collateral so sold. The Pledgees shall give the
          Pledgor not less than ten (10) days' written notice of its intention
          to make any such sale. Any such sale, shall be held at such time or
          times during ordinary business hours and at such place or places as
          the Pledgees may fix in the notice of such sale. The Pledgees may
          adjourn or cancel any sale or cause the same to be adjourned from time
          to time by announcement at the time and place fixed for the sale, and
          such sale may be made at any time or place to which the same may be so
          adjourned. In case of any sale of all or any part of the Collateral
          upon terms calling for payments in the future, any Collateral so sold
          may be retained by the Pledgees until the selling price is paid by the
          purchaser thereof, but the Pledgees shall incur no liability in the
          case of the failure of such purchaser to take up and pay for the
          Collateral so sold and, in the case of such failure, such Collateral
          may again be sold upon like notice. The Pledgees, however, instead of
          exercising the power of sale herein conferred upon them, may proceed
          by a suit or suits at law or in equity to foreclose the security
          interest and sell the Collateral, or any portion thereof, under a
          judgment or decree of a court or courts of competent jurisdiction, the
          Pledgor having been given due notice of all such action. The Pledgees
          shall incur no liability as a result of a sale of the Collateral or
          any part thereof. All proceeds of any such sale, after deducting the
          reasonable expenses and reasonable attorneys' fees incurred in
          connection with such sale, shall be applied in reduction of the
          Obligations, and the remainder, if any, shall be paid to the Pledgor.

                                        4

<PAGE>

          8. Application of Proceeds; Release. The proceeds of any sale or
enforcement of or against all or any part of the Collateral, and any other cash
or collateral at the time held by the Pledgees hereunder, shall be applied by
the Pledgees first to the payment of the reasonable costs of any such sale or
enforcement, then to reimburse the Pledgees for any damages, costs or expenses
incurred by the Pledgees as a result of an Event of Default, then to the payment
of the principal amount or stated valued (as applicable) of, and interest or
dividends (as applicable) and any other payments due in respect of, the
Obligations. The remainder, if any, shall be paid to the Pledgor. As used in
this Agreement, "proceeds" shall mean cash, securities and other property
realized in respect of, and distributions in kind of, the Collateral, including
any thereof received under any reorganization, liquidation or adjustment of debt
of any issuer of securities included in the Collateral.

          9. Representations and Warranties.

               (a) The Pledgor hereby represents and warrants to the Pledgees
that:

                    (i) the Pledgor has full power and authority and legal right
          to pledge the Collateral to the Pledgees pursuant to this Agreement
          and this Agreement constitutes a legal, valid and binding obligation
          of the Pledgor, enforceable in accordance with its terms.

                    (ii) the execution, delivery and performance of this
          Agreement and other instruments contemplated herein will not violate
          any provision of any order or decree of any court or governmental
          instrumentality or of any mortgage, indenture, contract or other
          agreement to which the Pledgor is a party or by which the Pledgor and
          the Collateral may be bound, and will not result in the creation or
          imposition of any lien, charge or encumbrance on, or security interest
          in, any of the Pledgor's properties pursuant to the provisions of such
          mortgage, indenture, contract or other agreement.

                    (iii) the Pledgor is the sole record and beneficial owner of
          all of the Shares; and

                    (iv) the Pledgor owns the Collateral free and clear of all
          Liens.

               (b) The Company represents and warrants to the Pledgees that:

                    (i) it has no knowledge that any of the representations or
          warranties of the Pledgor herein are incorrect or false in any
          material respect;

                    (ii) all of the Shares were validly issued, fully paid and
          non-assessable; and

                    (iii) the Pledgor is the record holder of the Shares.

          10. No Waiver; No Election of Remedies. No failure on the part of the
Pledgees to exercise, and no delay in exercising, any right, power or remedy
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise by the Pledgees of any right,

                                        5

<PAGE>

power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy. The remedies herein provided are cumulative
and are not exclusive of any remedies provided by law. In addition, the exercise
of any right or remedy of the Pledgees at law or equity or under this Agreement
or any of the documents shall not be deemed to be an election of Pledgee's
rights or remedies under such documents or at law or equity.

          11. Termination. This Agreement shall terminate on the date on which
all Obligations have been performed, satisfied, paid or discharged in full.

          12. Further Assurances. The parties hereto agree that, from time to
time upon the written request of any party hereto, they will execute and deliver
such further documents and do such other acts and things as such party may
reasonably request in order fully to effect the purposes of this Agreement. The
Pledgees acknowledge that they are aware that Pledgor shall have no obligations
whatsoever to the Pledgees beyond the Collateral pledged for the Obligations set
forth herein, and no request for further assurance may or shall increase such
Obligations.

          13. Miscellaneous.

               (a) Modification. This Agreement contains the entire
understanding between the parties with respect to the subject matter hereof and
specifically incorporates all prior oral and written agreements relating to the
subject matter hereof. No portion or provision of this Agreement may be changed,
modified, amended, waived, supplemented, discharged, canceled or terminated
orally or by any course of dealing, or in any manner other than by an agreement
in writing, signed by the party to be charged.

               (b) Notice. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of (i) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile telephone number specified in this Section prior to 6:30 p.m. (New
York City time) on a Business Day (as defined in the Purchase Agreement),

(ii)
the Business Day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile telephone number specified in this
Agreement later than 6:30 p.m. (New York City time) on any date and earlier than
11:59 p.m. (New York City time) on such date, (iii) the Business Day following
the date of mailing, if sent by nationally recognized overnight courier
services, or (iv) upon actual receipt by the party to whom such notice is
required to be given. The address for such notices and communications shall be
as follows:

          If to the Company:   Aquatic Cellulose International Corp.
                               2504 43rd Street
                               Suite 5
                               Vernon, British Columbia
                               Canada VIT 6L1
                               Attention: President and Chief Executive Officer
                               Telephone: 250-558-4216
                               Facsimile: 250-558-3846

                                        6

<PAGE>

             With copies to:   Naccarato & Associates
                               1960 Fairchild
                               Suite 260
                               Irvine, California 92612
                               Attention: Owen Naccarato
                               Telephone: 949-851-9261
                               Facsimile: 949-851-9262

          If to the Pledgor:   Sheridan B. Westgarde
                               c/o Aquatic Cellulose International Corp.
                               2504 43rd Street
                               Suite 5
                               Vernon, British Columbia
                               Canada VIT 6L1
                               Telephone: 250-558-4216
                               Facsimile: 250-558-3846

         If to the Pledgees:   AJW Partners, LLC
                               AJW Offshore, Ltd.
                               AJW Qualified Partners, LLC
                               New Millennium Capital Partners II, LLC
                               1044 Northern Boulevard
                               Suite 302
                               Roslyn, New York 11576
                               Attention: Corey S. Ribotsky
                               Facsimile No.: 516-739-7115

             With copies to:   Ballard Spahr Andrews & Ingersoll, LLP
                               1735 Market Street, 51st Fl.
                               Philadelphia, PA 19103
                               Attention: Gerald J. Guarcini, Esquire
                               Facsimile No.: 215-864-8999

               (c) Invalidity. If any part of this Agreement is contrary to,
prohibited by, or deemed invalid under applicable laws or regulations, such
provision shall be inapplicable and deemed omitted to the extent so contrary,
prohibited or invalid, but the remainder hereof shall not be invalidated thereby
and shall be given effect so far as possible.

               (d) Benefit of Agreement. This Agreement shall be binding upon
and inure to the parties hereto and their respective successors and assigns.

               (e) Mutual Agreement. This Agreement embodies the arm's length
negotiation and mutual agreement between the parties hereto and shall not be
construed against either party as having been drafted by it.

               (f) New York Law to Govern. This Agreement shall be governed by
and construed and enforced in accordance with the internal laws of the State of
New York

                                        7

<PAGE>

without regard to the principals of conflicts of law thereof. Each party hereby
irrevocably submits to the exclusive jurisdiction of the state and Federal
courts sitting in the city of New York, borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court or that
such suit, action or proceeding is improper. Each party hereby irrevocably
waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party at the
address in effect for notices to it under this agreement and agrees that such
service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                        8

<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this Guaranty and
Pledge Agreement to be duly executed by their respective authorized persons as
of the date first indicated above.

                                AQUATIC CELLULOSE INTERNATIONAL CORP.

                                By: /s/ Sheridan Westgarde
                                   -------------------------------------
                                   Sheridan B. Westgarde
                                   President and Chief Executive Officer

                                PLEDGEES:

                                AJW PARTNERS, LLC
                                By: SMS Group, LLC

                                   By:
                                      -------------------------------------
                                      Corey S. Ribotsky
                                      Manager

                                AJW OFFSHORE, LTD.
                                By: First Street Manager II, LLC

                                   By:
                                     --------------------------------------
                                     Corey S. Ribotsky
                                     Manager

                                AJW QUALIFIED PARTNERS, LLC
                                By: AJW Manager, LLC

                                   By:
                                      -------------------------------------
                                      Corey S. Ribotsky
                                      Manager

                                PLEDGOR:

                                ----------------------------------------
                                Sheridan B. Westgarde

                                Number of Shares subject to this pledge: _______

                                Date such Shares were acquired: _______

                                        9

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