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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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<SEC-DOCUMENT>0000897069-05-001997.txt : 20061115
<SEC-HEADER>0000897069-05-001997.hdr.sgml : 20061115
<ACCEPTANCE-DATETIME>20050811154345
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0000897069-05-001997
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20050811

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			FLEXIBLE SOLUTIONS INTERNATIONAL INC
		CENTRAL INDEX KEY:			0001069394
		STANDARD INDUSTRIAL CLASSIFICATION:	MISCELLANEOUS CHEMICAL PRODUCTS [2890]
		IRS NUMBER:				911922863
		STATE OF INCORPORATION:			NV
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		2614 QUEENSWOOD DR
		CITY:			VICTORIA B C V8N 1X5
		STATE:			A1
		BUSINESS PHONE:		2504779969

	MAIL ADDRESS:	
		STREET 1:		2614 QUEENSWOOD DR
		CITY:			VICTORIA BC CANADA
		STATE:			A1
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.htm
<TEXT>
<HTML>
<HEAD>
<TITLE></TITLE>
</HEAD>
<BODY>


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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>[FLEXIBLE SOLUTIONS
LETTERHEAD] </FONT></H1>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>August 11, 2005</FONT></P>

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<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>VIA EDGAR &#150; CORRESPONDENCE FILING</U></FONT></H1>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Securities and Exchange Commission<BR>
Judiciary Plaza<BR>
450 Fifth Street, N.W., Mail Stop 0510<BR>
Washington D.C., 20549<BR>
Attn: Ms. Pamela A. Long </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Re: </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I><B>Flexible Solutions International, Inc.<BR>
Registration Statement on Form S-3, filed on May 10, 2005 (SEC File No. 333-124751); Annual Report on Form 10-KSB for the Fiscal Year Ended December&nbsp;31, 2004, filed on March 24, 2005 (SEC File No. 1-31540;) and Quarterly Report on Form <U>10-QSB for the Fiscal Quarter Ended March 31, 2005, filed on May 13, 2005
(SEC File No. 1-31540)</U></B></I></FONT></TD>
</TR>
</TABLE>
<BR>


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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dear Ms. Long: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Flexible
Solutions International, Inc. (the &#147;<U>Company</U>&#148;), has reviewed the
Securities and Exchange Commission (the <U>&#147;Commission</U>&#148;) letter dated July
12, 2005 (the &#147;<U>July 12 Comment Letter</U>&#148;) regarding the Company&#146;s
Registration Statement on Form S-3 (the &#147;<U>Form S-3</U>&#148;), the Company&#146;s
Annual Report on Form 10-KSB for the fiscal year ended December 31, 2004 (the
&#147;<U>Form 10-KSB</U>&#148;) and the Company&#146;s Quarterly Report on
Form&nbsp;10-QSB for the fiscal quarter ended March 31, 2005 (the &#147;<U>Form
10-QSB</U>&#148;), filed by the Company on May 10, 2005, March 24, 2005 and May 13, 2005,
respectively. The Company responds to the July 12 Comment Letter as follows: </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>A.</B>  </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><U>Response
to SEC Comment 1</U></B> </FONT></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
SEC has replied that it is still unclear, given the guidance in Rule 11-01(d) of
Regulation S-X, how the Company determined that the acquisition of the Donlar assets was
not a purchase of a business. We believe that there are two primary factors that support
our position that Donlar was not an acquisition of a business. First, the business of
Donlar was bankrupt with no existing or projected profitable operations. Secondly,
substantially all of the customers of Donlar ceased doing business with the Company and
all relationships with previous customers had to be completely rebuilt. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Rule
11-01(d) of Reg. S-X lists several factors to be considered in determining whether a
&#147;business&#148; has been acquired, the overall focus being whether there is a
sufficient continuity of the acquired entity&#146;s operations prior to and after a
transaction such that the disclosure of the prior financial information is material to an
understanding of future operations. For purposes of such determinations, Rule 11.01(d) of
Reg. S-X sets forth the applicable measures, which are as follows: </FONT></P>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 2</FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          whether the nature of the revenue-producing activity acquired is generally the
          same as before the transaction; or </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          whether any of the following attributes of the acquired operations were
          transferred: (i) physical facilities, (ii) employee base, (iii) market
          distribution system, (iv) sales force, (v) customer base, (vi) operating rights,
          (vii) production techniques, or (viii) trade names. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It
is under this framework that the Company concluded it did not acquire a
&#147;business&#148; when it acquired the Donlar assets. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Purchase
of the Assets</U>. In May 2004 the Company acquired substantially all of the assets of
Donlar for the purchase price of $6.15 million. Consideration for the purchase price was
the payment of $3 million in cash, and the issuance of a secured promissory note to
Tennessee Farmers Life Insurance Company (&#147;<U>TFL</U>&#148;) for the remainder,
bearing interest at 4% per annum and due June 2, 2005. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
the time of Donlar&#146;s bankruptcy, TFL was Donlar&#146;s largest creditor and was
granted security interests, mortgages and other liens on substantially all of
Donlar&#146;s assets. Due to a lack of profitable operations and negative cash flow Donlar
defaulted on its loans. TFL then commenced foreclosure proceedings and, in April 2004, the
United States Bankruptcy Court for the Northern District of Illinois, Eastern Division,
authorized the sale of the Donlar assets through a bidding process. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Through
the auction process the receivers were unable to obtain any bidder for the assets of
Donlar. Although it had many patents and unique production processes the receivers were
unable to find any synergistic or otherwise potential purchaser who could utilize the
patents and processes developed by Donlar. As a result, FSI was the only bidder for the
assets of Donlar. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;When
the Company acquired the assets of Donlar, knowing full well that the business of Donlar
had ceased, it had as its primary objective the consolidation of the distribution and all
feasible manufacturing operations of the Company in one facility in the United States.
Prior to the acquisition of the Donlar assets the Company had a research facility in
Victoria, British Columbia, Canada, a manufacturing plant in Calgary, Alberta, Canada, a
distribution centre in Richmond, British Columbia, Canada, an additional distribution
centre in Chicago, Illinois, and an additional distribution center in Blaine, Washington.
Although the majority of the Company&#146;s manufacturing and distribution centers were
located in Canada, the majority of the Company&#146;s current and potential market share
resided in the United States. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;One
of the contributing factors for acquiring the operating assets and plant of Donlar was the
cancellation of the Sun Solar Energy Technologies and Ondeo Nalco distribution agreements.
Prior to the first quarter of 2004 the Heat$avr and Tropical Fish products were
distributed in North America by Sun Solar Technologies. During the fiscal year 2003 73% of
the Company&#146;s total sales were through this company. The exclusive distribution
agreement with Sun Solar Technologies was entered into in February 1998. In order to
maintain the exclusivity of such agreement, Sun Solar Technologies had to order and pay
for at least 860,000 units during the year ended February 29, 2004. The agreement
terminated on February 29, 2004. Because the Company believed that it could distribute the
Tropical Fish products more economically than Sun Solar Technologies through its own
channels and Sun Solar Technologies did not meet the sales quota, the distribution
agreement was not renewed. The Company intended to distribute the Tropical Fish products,
renamed to Eco$avr, through the new Donlar plant. </FONT></P>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 3</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
June 2002 the Company introduced the Water$avr product. This product utilizes the
Company&#146;s technology to reduce water evaporation. It is marketed as a water
conservation product for use where water is standing or gently flowing and the need for
water can justify the cost of purchase and deployment of the product. The potential
applications for the product include reservoirs, potable water storage, aqueducts and
canals, agricultural irrigation, flood water crops, lawn and turf care and mining. The
Water$avr is sold in granular form and can be applied either by hand or through a fully
automated dispersal system. The primary markets for the Water$avr products are expected to
be Australia, Spain and the United States. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
September 2002 the Company granted Ondeo Nalco, of Naperville, Illinois, the exclusive and
non-exclusive distribution rights in Canada, the United States and most other countries
other than India and its surrounding countries. To maintain the exclusive rights to
distribute the Water$avr product Ondeo Nalco had to meet certain sales targets. If these
targets were not met then the exclusive rights would convert to non-exclusive rights.
Prior to September 30, 2003 Ondeo Nalco was successful in meeting its sales targets. In
September 2003 Ondeo Nalco missed a milestone sales level. As a result, the exclusive
rights reverted to non-exclusive rights and the options of the Company stock granted to
Ondeo Nalco were cancelled. The Company also has the Water$avr product manufactured by
Ondeo Nalco through a separate manufacturing agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company announced the cancellation of the Ondeo Nalco exclusive distribution agreement in
a press release dated October 9, 2003. In this press release the Company stated that
although the exclusive distribution agreement would be modified, Ondeo Nalco would
continue to be the manufacturer of the product. With the acquisition of the Donlar assets
and plant, the Company would now be in a position to not only distribute the Water$avr
product in the United States and other countries, but would now also be in a position to
manufacture the product. The processes employed by Donlar to manufacture and produce its
biopolymers were very similar to the processes used by the Company to manufacture
Water$avr. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Water$avr product was a patented product by the Company that when deployed onto a water
surface significantly reduced evaporation. With the addition of the Donlar assets the
Company was now able to continue its development of the Water$avr product and expand its
capabilities to Water$avr-BTI. Water$avr-BTI combines the original Water$avr technology
with mosquito larvae control. Water$avr-BTI, since the end of 2004, has been marketed
primarily for use in the reservoir, potable water storage, aqueduct, canal, agricultural
irrigation and mining industries. The Company would not have been able to profitably
manufacture this product without the addition of the Donlar assets. </FONT></P>





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<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 4</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Water$avr-BTI
falls under the pest control ruling of the United States Environmental Protection Agency
(&#147;<U>EPA</U>&#148;). All factories manufacturing pest control materials must be EPA
approved in addition to obtaining the approval of the product itself. FSI has already had
the old Donlar plant EPA approved for Water$avr-BTI manufacture and is awaiting EPA
product approval in order to fulfill existing product orders. It is extremely difficult to
manufacture pest control products intended for use in the USA outside of the US, and FSI
would have found it difficult if not impossible to provide this product without a US
factory. Internal research by FSI has shown that the Water$avr-BTI market size in the USA
is in the range of $35 million per year &#151; far in excess of the historical sales of
Donlar. FSI was specifically planning for this situation when assessing the purchase of
Donlar assets. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FSI
has performed research and filed US patents for methods of sensing biohazards and
chemical pollutants in drinking water. This sensitive work leads to opportunities to
reformulate our Water$avr product in the old Donlar plant for sales to homeland  security channels. This type of work
must be done in US labs and factories by US citizens. The management of FSI perceived the
Donlar assets including the scientific team as ideal for these purposes. FSI is also
actively working on Water$avr versions that control algae as well as evaporation for use
in reservoirs that suffer from both problems. This product when finalized will be
formulated and distributed from the Donlar plant. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition to the above, and concurrent with the acquisition of the manufacturing plant, the
Company also negotiated with the Donlar leaseholders to obtain the use of Donlar&#146;s
former corporate office space and laboratory facilities. These leases were independently
assumed by the Company and are on financial terms that differ from Donlar&#146;s previous
obligations. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
addition of the Donlar assets and operating plant has provided the Company with
significant benefits apart from rebuilding the discontinued business of Donlar. The most
significant benefits of acquiring the Donlar assets are as follows: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The addition of the operating assets and manufacturing plant will enable the
          Company to consolidate some of its manufacturing processes that were previously
          in two locations in British Columbia, in Alberta, and in Illinois. The Company
          does not expect to consolidate all of the manufacturing operations in the Donlar
          plant as there are still some specific expertise and economies of production in
          the Alberta plant that would not be realized in the Donlar plant for some time.
          Once sales of certain products exceed the production capabilities of the
          Albertan plant, the Company intend to manufacture the additional sales in the
          Donlar facility: </FONT></P>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 5</FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Has enabled the Company to create one large distribution center in the United
          States for all of its products. The new distribution centre has assisted the
          Company to replace the distribution channels previously used by Sun Solar
          Technologies to market and distribute the Tropical Fish; </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Has enabled the Company to continue its development plan by adding Water$avr-BTI
          to its list of products that it can now market to different segments; and </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(4)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Will enable the Company to manufacture the Water$avr product in-house rather
          than relying on outside manufacturers such as Ondeo Nalco. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Donlar
Business</U>. When the Company acquired the assets of Donlar it was aware that the
business of Donlar was very poorly managed and that it had lost all of its major
customers. As stated, a secondary objective of the Company was to try and rebuild the
Donlar business since it was very similar. After the acquisition, the Company attracted
some of the old Donlar customers back to NanoChem only after they were convinced that a
complete new business with new management had been created. Many of the remaining Donlar
customers intended to switch to Lanxcess, a Donlar competitor as soon as stock in hand was
exhausted. Extensive efforts by FSI personnel were required to convince these customers to
try the new NanoChem products. Only after the acquisition did the Company begin to develop
and market its own TPA biopolymer products. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prior
to filing for bankruptcy protection, Donlar and its predecessors were engaged primarily in
the production, marketing, distribution and sale of the following three product lines: </FONT></P>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;</FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Nutraceuticals
(nutrition supplement and sports bar markets); </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149;</FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Biopolymers
(performance chemical markets); and </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#149; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Agriscience
Compounds (agricultural product markets).  </FONT></TD>
</TR>
</TABLE>
<BR>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <I>Nutraceuticals</I>. Prior to the Company&#146;s acquisition of the Donlar
          assets, Donlar was engaged in the research, development, distribution and sale
          of nutraceutical and medical food products and supplements. These nutraceutical
          products were developed by Donlar and incorporated a patented whey protein
          technology designed to provide or increase protective immunities from and immune
          response to disease and to provide nutritional supplements. Donlar&#146;s
          nutraceutical products were marketed to health food stores, health clubs and
          sporting good stores. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <I>Biopolymers</I>. Prior to the Company&#146;s acquisition of the Donlar
          assets, Donlar was also engaged in the development, manufacture and marketing of
          biodegradable polymers (&#147;<U>biopolymers</U>&#148;). Biopolymers are
          non-hazardous, non-toxic, hypoallergenic, environmentally friendly and
          biodegradable chemical protein compounds. Biopolymers are used in a broad range
          of industrial and consumer markets and are manufactured from the common
          biological amino acid, L-aspartic acid. Donlar&#146;s biopolymers were marketed
          by Donlar to prevent mineral scale and metal corrosion in industrial processes
          that use high volumes of water. The manufacturing processes used for biopolymers
          is very similar to the processes used to manufacture Water$avr. </FONT></P>





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<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 6</FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <I>Agriscience Compounds</I>. Prior to the Company&#146;s acquisition of the
          Donlar assets, Donlar was also engaged in the production and sale of biopolymer
          compounds specifically designed for the agriculture market. Donlar marketed
          these compounds to the agriculture industry as capable of significantly
          increasing the effectiveness of fertilizers. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
noted, the products of Donlar were quite unique from the products developed by the
Company. However, the processes and equipment used to market each entity&#146;s products
were substantially the same. For this primary reason, the Company acquired the bankrupt
assets of Donlar. Also as stated above, the Company&#146;s secondary intention was to
rebuild the business of Donlar, now as Nanochem, and return the business to profitable
operations and cash flow. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the acquisition, the Company acquired 52 U.S. and 139 international patents and a 58,700
square-foot manufacturing plant on 40 acres of property. From a manufacturing standpoint,
this included Donlar&#146;s manufacturing and testing equipment specifically designed for
production of biopolymers. While the Company was not engaged in the biopolymer business
prior to its purchase of the Donlar assets, the Company determined that the manufacturing
processes and facilities used by Donlar could be easily converted for the manufacture and
production of the Company&#146;s commercial water evaporation retardants. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Employee
Base</U>. At the time of the acquisition of the assets from Donlar, Donlar had 16
employees and 14 employees at the time Donlar filed a Petition for Bankruptcy in February
2004. The Company has since re-hired 9 of the 16 individuals employed by Donlar at the
time of the acquisition. Except as set forth in the following sentence, these employees
are largely identified as non-critical laborers and office staff. None of Donlar&#146;s
executive officers and key employees were rehired, except that one factory manager, two
scientists and one salesman were rehired. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company rehired certain of the employees of Donlar not because they were familiar with the
business of Donlar but mainly because they were familiar with the processes and
distribution channels of Donlar. These key employees would be the best resources to deploy
the Company&#146;s products into Donlar&#146;s previous distribution channel and also
adapt the manufacturing processes of Donlar to manufacture the products developed and
manufactured by the Company. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Sales
Force</U>. Only one of the 9 former employees of Donlar re-hired by the Company has any
sales or marketing functions. This salesman was involved primarily in the sales of
biopolymers to the agricultural industry. The Company determined that the cost of sales
and other costs associated with this salesman resulted in a net loss based on past
performance, but re-hired this individual anyway in order to attempt to foster synergy
between the agricultural biopolymers and the Company&#146;s own efforts to sell its
Water$avr products to the agricultural industry. Since the acquisition of the Donlar
assets, Daniel O&#146;Brien and Herbert Bolz, both of whom were previously unaffiliated
with Donlar, and as assisted from time to time by the two rehired scientists, have served
as the primary salespersons for the Company&#146;s TPA biopolymer products. </FONT></P>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 7</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Customer
Base</U>. Due to the significant financial difficulties experienced by Donlar prior to and
during its bankruptcy proceedings, Donlar&#146;s customer base had diminished
significantly. Moreover, Donlar had no long-term purchase agreements with its customers.
As a result, the Company did not acquire any significant customer base in the acquisition.
The Company has had to expend significant resources to establish new relationships with
certain of Donlar&#146;s former customers, as well as to acquire customers for its TPA
biopolymer business. Consequently, the percentage of &#147;new&#148; customers to
&#147;old&#148; customers, while only approximately 25%, is deceptively low as it does not
account for the substantial efforts required of the Company to establish a new biopolymer
customer base. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Trade
Names</U>. The Company acquired all of Donlar&#146;s trade names in connection with the
acquisition. However, none of the Donlar trade names were ever used by the Company. All
biopolymer products manufactured using the assets acquired from Donlar are now produced
and sold by NanoChem Solutions Inc., the Company&#146;s wholly-owned subsidiary. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <I>Bankruptcy</I>. Donlar was a bankrupt company in a Chapter 11 proceeding
          under Title 11 of the United States Code. Prior to filing for bankruptcy
          protection, Donlar was operating in a deteriorating financial condition in which
          its secured debt exceeded its assets by more than four to one. During the
          bankruptcy proceeding, Donlar&#146;s operations were further downscaled in order
          to preserve assets pending the Bankruptcy Court&#146;s auction. The fact that
          the assets were auctioned within less than six months of the bankruptcy filing
          underscores the fact that the business of Donlar, as then conducted, could not
          be maintained long enough or at a sufficient level to even attempt
          reorganization of the business. Since the sale of its assets to the Company,
          Donlar&#146;s bankruptcy proceeding has been converted to a Chapter 7 case and
          the assigned trustee has been engaged in liquidating Donlar&#146;s remaining
          assets. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <I>State Law</I>. The opinions set forth above regarding the lack of sufficient
          continuity of Donlar&#146;s business operations following the acquisition of its
          assets by the Company are supported by state law authority on successor
          liability, which provides that the acquisition of assets from a company in
          bankruptcy, absent an express assumption of obligations, falls short of meeting
          the requirements for state law successor liability purposes. See, <U>e.g.</U>,
          <I>Nelson v. Tiffany Industries</I>, 778 F.2d 533 (1985) (recites general rule
          against imputing liability to successor corporation in bankruptcy action); and
          <I>Henkel Corp. v. Hartford Acc. &amp; Indem. </I>Co., 29 Cal.4th 934 (2003)
          (except under certain limited circumstances, the buyer of corporate assets will
          not be liable for the obligations of the selling entity absent an express
          agreement to assume such obligations). </FONT></P>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 8</FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <I>Financial Statements</I>. The Company purchased the Donlar assets in June
          2004. At that time, Donlar&#146;s latest audited financial statements were
          prepared as of December 31, 2002 and Donlar&#146;s latest unaudited financial
          statements were prepared as of September 30, 2003. Because of this, the
          Company&#146;s principal executive officer and principal financial officer do
          not believe that the financial records of Donlar since its last audited
          financial statements are complete, nor do they believe that such records have
          been prepared in accordance with generally accepted accounting principles.
          Notwithstanding the above, the Company could not reconstruct Donlar&#146;s
          financial statements because the Company does not have access to the financial
          records of Donlar, nor was the Company originally provided with any such records
          in connection with its purchase of the assets from Donlar. As a result, the
          Company&#146;s principal executive officer and principal financial officer would
          not be able to certify any of the Company&#146;s periodic reports that contain
          financial statements incorporating any of Donlar&#146;s financial data.
          Moreover, the Company believes that the inclusion of Donlar&#146;s &#147;monthly
          operating reports,&#148; which are required to be filed under bankruptcy law and
          which are also not prepared in accordance with generally accepted accounting
          principles, do not contribute to a more informative financial presentation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
light of the use of the Donlar assets for biopolymer production and the Company&#146;s
conversion of the physical facilities acquired into a viable distribution facility for
evaporation control products, a manufacturing facility for enhanced versions of the
evaporation products, and a swing production facility of basic Water$avr, the Company
believes that the disclosure of financial information concerning the business of Donlar
would be misleading, insofar as the revenue-producing activities of the assets acquired
from Donlar are sufficiently different from the activity for which such assets were
employed by Donlar. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the Company&#146;s annual report Form 10-KSB for the fiscal year ended December 31, 2004,
the Company stated the following: </FONT></P>

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<TR VALIGN=TOP>
<TD WIDTH=20%>&nbsp;</TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
NanoChem
Solutions Inc.: In June of 2004 FSI acquired the assets of Donlar Corporation for $6.15
million from the bankruptcy estate. The $6.15 million in assets were placed in a newly
incorporated Nevada subsidiary of Flexible Solutions International Inc called NanoChem
Solutions Inc of which all the issued and outstanding shares are owned by Flexible
Solutions International Inc. The newly acquired assets include a broad portfolio of
environmentally friendly technologies and products, 52 US and 139 International patents
and the 56,780 square foot manufacturing plant on 40 acres of property. Donlar also rented
corporate offices and a laboratory in Bedford Park that will continue to be used by the
new company. The net book value of the assets is placed at around $4.45 million for
property, plant and equipment, in addition to $1.7 million for intellectual property. The
water-soluble products acquired by FSI utilize thermal polyaspartate (TPA) biopolymers
[beta-proteins manufactured from the common biological amino acid, L-aspartic]. TPAs can
be formulated to prevent corrosion and scaling in water piping within the petroleum,
chemical, utility and mining industries, as well as proteins that enhance fertilizers to
improve crop yields; additives for household laundry detergents, improvement to consumer
care products and enhancement of pesticide functionality.</FONT></TD>
</TR>
</TABLE>
<BR>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 9</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
statement explains the acquisition of the Donlar assets and the consideration paid. We now
find that this statement is slightly misleading in that it states that the &#147;The net
book value of the assets is placed at around $4.45 million for property, plant and
equipment, in addition to $1.7 million for intellectual property. This statement leads the
reader to believe that some value was allocated to the intellectual property. However, no
value was allocated to any of the intellectual assets in the most recent audited annual
financial statements and the relevant quarterly financial statements. The tangible assets
were only recorded to the extent that the purchase price paid did not exceed their
ascribed fair market values. The Company did not allocate any of the purchase price to
intellectual property or patents as there was no ongoing business or prospect of positive
cash flow to justify the allocation to intangible assets. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s auditors also reviewed the acquisition of the Donlar assets in detail and
reviewed the business of Donlar to ensure that there in fact was no continuing business.
The auditors reviewed the purchase agreement, investigated the premises and counted and
confirmed the inventory purchased from Donlar. They concluded and agreed that there was no
significant continuing business of Donlar. They also confirmed that it would be very
difficult to audit the financial statements of Donlar as no records were available. The
only records that were made available to the Company were the trial balance of the
division as at March 31, 2004 and certain sales and expense reports. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company also believed, and the auditors concurred, that to prepare pro forma financial
statements combining the operations of Donlar with those of the Company would be very
misleading. First, the minimal financial records provided to the Company were extremely
unreliable and were not audited by the external accountants of Donlar. We have also been
informed that the previous management of Donlar is being investigated by certain
authorities for fraudulent reporting. Secondly, since the business of Donlar had
substantially ceased operations by the time the Company acquired the assets out of
bankruptcy, to show any ongoing revenue through pro forma financial statements would
exaggerate the revenue to be realized in the future. </FONT></P>





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<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 10</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
summary, because of the facts that: </FONT></P>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
business associated with the acquired assets is now significantly different than as it
was with Donlar and now operates          under a different trade name, </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
physical assets acquired from Donlar will produce a more diverse line of products than as
they did when utilized by Donlar and are now also being used to manufacture the products
previously produced by the Company or outside manufacturers,  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
real property occupied by the Company is leased on different financial terms than as it
was with Donlar, </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
sales force that was employed to sell the products manufactured using the Donlar assets
is nearly entirely different and the sales force that was rehired is now primarily
engaged to market the products of the Company,  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
Company has developed its own marketing and distribution channels, has developed new
customers as compared against the channels and customers associated with Donlar, and has
independently reacquired many of Donlar&#146;s former customers,  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
business of Donlar had almost completely failed prior to and during the bankruptcy
proceeding, and </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;current
audited or unaudited financial information may be incomplete and, nevertheless, is not
available to the Company such that the Company could reconstruct the financial statements
of Donlar,  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>the Company believed that the
acquisition of assets from Donlar through a bankruptcy auction process did not result in
any sufficient continuity of the former operations of Donlar, and that disclosure of
financial information pertaining to Donlar would be misleading to an understanding of the
Company&#146;s future operations. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>B. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 2</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amendment
No. 2 to the Form S-3, when filed, will be revised in response to this comment. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>C. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 3</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amendment
No. 2 to the Form S-3, when filed, will be revised in response to this comment as follows: </FONT></P>





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<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 11</FONT></P>



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<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>We
are subject to credit risk and may be subject to  substantial  write-offs if one or more
                  of our significant customers default on their payment obligations to us. </I></B></FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
currently allow our major customers between 30 and 45 days to pay for each shipment of
product we make to them. This practice, while customary, presents an accounts receivable
write-off risk in that if one or more of our significant customers defaulted on their
payment obligations to us, such write-off, if substantial, would have a material adverse
effect on our business and results of operations. While we have exposure to this type of
risk, we are no longer subject to the concentrated credit risk that we were previously
subject to because of our relationship with Sunsolar Technologies. In addition, while our
exposure to a bad debts and write-offs credit risk may increase as we service a larger
number of customers in the swimming pool and personal spa, water evaporation and TPA
industries, the effect of any such bad debts and write-offs will be minimized as a result
of the increase in the numbers of our customers and overall revenues. </FONT>
</TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>D. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 4</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amendment
No. 2 to the Form S-3, when filed, will be revised in response to this comment as follows: </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><I>Our
 products  can be  hazardous  if not  handled,  stored  and used  properly;  Litigation
                  related to the handling,  storage and safety of our products  would
have a material  adverse  effect                   on our business and results of
operations.</I></B> </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Some
of our products are flammable and must be stored properly to avoid fire risk.
Additionally, some of our products may cause irritation to a person&#146;s eyes if they
are exposed to the concentrated product. Although we label our products to warn of such
risks, our sales could be reduced if our products were to be viewed as being dangerous to
use or if they are implicated in causing personal injury or property damage. We are not
currently aware of any circumstances in which our products have caused harm or property
damage to consumers. Nevertheless, litigation regarding the handling, storage and safety
of our products would have a material adverse effect on our business and results of
operations. </FONT>
</TD>
</TR>
</TABLE>
<BR>




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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 12</FONT></P>




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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>E. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 5</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amendment
No. 2 to the Form S-3, when filed, will contain the consents required pursuant to Item
601(b)(23) of Regulation S-B.</FONT></P>


<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>F. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 6</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s amendment to the Form 10-KSB, when filed, will be revised in response to
this comment as follows: </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%>&nbsp;</TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<B>Liquidity and Capital Resources</B> </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%>&nbsp;</TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
The
following section discusses the effects of changes in our balance sheet and cash flow on
our liquidity and capital resources. The following table summarizes our cash, cash
equivalents and working capital that directly have an impact on our immediate and future
cash needs and sources.</FONT></TD>
</TR>
</TABLE>
<BR>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2004</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2003</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=3><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Increase<BR>
(Decrease)</FONT><HR WIDTH=100% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=40% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Cash and cash equivalents</FONT></TD>
     <TD WIDTH=1% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=3% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    558,795</FONT></TD>
        <TD WIDTH=5% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    237,080</FONT></TD>
        <TD WIDTH=4% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=1% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$</FONT></TD><TD WIDTH=14% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>    321,715</FONT></TD>
        <TD WIDTH=2% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Short-term investments</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>559,440</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5,033,837</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(4,474,397</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Working capital</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(101,121</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>)</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5,752,679</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(5,853,800</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Short-term loan</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,150,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>0</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD><TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3,150,000</FONT></TD>
        <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
</TABLE>

<BR>
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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
overall decrease in short-term investments and cash and cash equivalents was primarily a
result of cash used for the purchase of the Donlar Corporation assets. Cash was also used
to introduce and market our Water$avr product, which has not yet attained significant
sales to maintain positive cash flow. Our working capital has also decreased by $5,853,800
as a result of acquiring the Donlar assets and assuming a short-term loan for the
purchase. As shown, the short term loan was $3,150,000 from nil in the previous year.
Without this loan we would have had substantial working capital. </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Historically,
prior to 2004, our operations have been cash flow positive after considering the add back
to net income of the stock compensation expense and depreciation. In 2004 our operations
generated negative cash flow as we acquired a large amount of inventory and we financed
the purchase of the Donlar assets through the redemption of short-term investments. In
order to build our business, develop and research our products and sustain our start-up
operations, we have relied mainly on external equity financing. We intend over the next
two quarters to obtain additional external equity financing to repay the short-term debt,
which is due in June 2005, and continue to develop our products. </FONT>
</TD>
</TR>
</TABLE>
<BR>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 13</FONT></P>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
expect that cash provided by operating activities may fluctuate in future periods as a
result of a number of factors, including the fluctuations in our operating results,
shipments, accounts receivable collections, and inventory management. As our sales
continue to build, our accounts receivable will increase and our overall inventory levels
will also increase. </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other
than to repay or replace the short-term loan due in June 2005, we have no other
commitments or guarantees in the next 12 months that will materially affect our cash
position or needs. We believe we have sufficient capital to support our business and
operations for at least the next 12 months. We anticipate utilizing approximately $500,000
in the next twelve months attempting to close sales in California, Spain and Australia and
to extend certain core US patents to select other countries. Approximately 80% of such
expenditures are related to our recently introduced Water$avr product. </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There
can be no assurance that any of the expenditures will result in additional sales revenues.
In the event that our capital resources are not sufficient for the continued expansion of
the Company, new capital will be needed or marketing expenses will have to be curtailed
until capital is available. There is no guarantee that capital will be available on terms
acceptable to the Company or at all. There are no investment banking agreements in place
at this time. </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>G. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 7</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company has taken the position that the acquisition of the Donlar assets is not a purchase
of a business; accordingly it has not adopted certain of the disclosure requirements for
business combinations as set out in SFAS 141. Specifically, it has not included the
disclosures stated in paragraphs 51, 52, 54 and 55 of SFAS 141. </FONT></P>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 14</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Paragraph
37 of SFAS 141 provides general guidance for assigning amounts to the assets and
liabilities acquired in a business combination. More specifically, paragraph 37(e) states
that intangible assets that meet the criteria in paragraph 39 should be recorded at their
estimated fair values. The criteria set out in paragraph 39 states that an intangible
asset shall be recognized as an asset apart from goodwill if it arises from contractual or
other legal rights. Even if the intangible asset does not arise from contractual or other
legal rights, it shall be recognized as an asset apart from goodwill only if it is
separable or capable of being separable. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
concur that the patents are intangible assets that arose from contractual obligations and
are capable of being separable and could be recognized as assets apart from goodwill.
However, in recording the assets acquired from Donlar we only recognized their carrying
value to the extent the allocated cost is only allocated to tangible fixed assets to the
extent of their fair values. The patents and other intangible assets only have value to
the Company to the extent their cost can be supported by the cash flow or earnings
generated by the Company. These patents also only have value to the Company in use, which
implies that the patents can only be used in the exact same business or by a competitor
who can utilize the patents. It has been clearly shown that no competitor wanted the
patents or other technology as there were no other bidders for the assets of Donlar other
than the Company. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Since
there is no ongoing business of Donlar or potential for positive earnings, we have not
allocated any of the purchase price to the patents or other intangible assets. We have
only allocated the purchase price to the fixed assets to the extent of their fair market
values. As stated above, since the Company does have as its secondary objective the
intention of rebuilding the business of Donlar, it did announce that it did acquire
certain patents and other technological assets of Donlar. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>H. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 8</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
revised revenue recognition policy as stated in our previous reply to the SEC is as
follows: </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenue
from product sales is recognized at the time the product is shipped since title and risk
of loss is transferred to the purchaser upon delivery to the carrier. Shipments are made
F.O.B. shipping point. The Company recognizes revenue when there is persuasive evidence of
an arrangement, delivery has occurred, the fee is fixed or determinable, collectibility is
reasonably assured, and there are no significant remaining performance obligations. When
significant post-delivery obligations exist, revenue is deferred until such obligations
are fulfilled. </FONT>
</TD>
</TR>
</TABLE>
<BR>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 15</FONT></P>



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<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provisions
are made at the time the related revenue is recognized for estimated product returns.
Since the Company&#146;s inception, product returns have been insignificant; therefore no
provision has been established for estimated product returns. </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
revenue recognition note states that if there are significant post-delivery obligations
revenue is deferred until such obligations have been fulfilled. In practice, the Company
has very little post-delivery obligations. For purposes of customer service satisfaction,
the Company will deliver replacement product if the customer believes there is a defect in
the product that they purchased. However, over the life of the products the Company has
had to replace approximately two or three items because of perceived defects. Products
that are replaced, mainly only the Tropical Fish, are normally very small dollar items.
When the Company starts to sell products that do have significant post-delivery
obligations, which is not expected in the near future, revenue will be deferred until the
post-delivery obligation has been fulfilled. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company does not have any arrangements with distributors or resellers that provide these
resellers with the opportunity to return the products in the case that they are not sold. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company believes that it does comply with SAB Topic 13 in relation to its revenue
recognition policies. The Company has a relatively simple sales cycle in that products
sold to distributors do not contain any specific terms or rights of return or
post-delivery obligations, and the payment terms are all within 30 to 45 days regardless
of the type of product sale. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>I. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 9</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
2003 the Company acquired an option to purchase 20% of Tatko, Inc. (&#147;Tatko&#148;) for
the issuance of 100,000 shares of the Company&#146;s common stock. The purchase of the
option also included the right to use the bio-chemicals and patents of Tatko in the
Company&#146;s products. As part of the agreement, Tatko was supposed to supply the
Company with samples of its specific technologies so that the Company could adapt its
processes to incorporate the technologies of Tatko. Unfortunately, Tatko was very slow in
providing &#147;clean&#148; samples that the Company could work with. Consequently, the
Company believed that Tatko had breached its agreement and demanded the return of the
shares. Until such time as the issue is settled, the Company still maintains the right to
acquire a 20% interest in Tatko. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tatko
is a technology company that performs research and development activities for numerous
biological related processes. A significant asset of Tatko is the world-wide patents on
exceptionally effective strains and methods of growth for Azo-spirillium. These microbes
are excellent candidates for spreading on rice fields using Water$avr and is a technology
that the Company can capitalize on in the future. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company believes that the patents developed by Tatko are extremely beneficial to its
future operations. Once the litigation involving the return of the shares of the Company
has been settled, the Company intends to negotiate with Tatko to either enter into a
normal supplier/customer relationship to acquire Tatko&#146;s products or it will
negotiate to acquire Tatko. </FONT></P>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 16</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company continues to deal with Tatko on an ongoing basis to try and settle the outstanding
issues and discuss the technologies of Tatko and the synergies these technologies will
have with the Company. The technologies still have considerable present and future benefit
to the Company, which implies that the investment in Tatko still has continuing benefit.
Tatko is still in operation and still maintains its patents. The Company expects that the
issues between the two companies will be resolved in 2005 and during that time the
carrying value of the investment will be reviewed. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company relies on the accounting policies of SFAS 115 &#147;Accounting for Certain
Investments in Debt and Equity Securities&#148; and the guidelines of EITF 030-01
&#147;The Meaning of Other-Than-Temporary Impairment of Certain Investments&#148; for
assessing the accounting treatment and carrying value of the investment. In accordance
with these pronouncements, the investment is still reviewed on a continuous basis by
analyzing the technology and operations of Tatko to ensure that the carrying value is
justified. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company considers the investment impaired when the fair value is less than its carrying
amount. Since the investment does not have a readily determinable fair value, the Company
has taken the position that the fair value assessment will be measured when an impairment
indicator is present. Tatko&#146;s lack of timeliness in providing &#147;clean&#148;
samples, which precipitated the Company&#146;s demand for the return of the shares, does
imply that there may be an impairment issue. However, as stated above, the Company has
determined that the patents and their use do still have considerable future benefits. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>J. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 10</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s amendment to the Form 10-KSB, when filed, will be revised in response to
this comment as follows: </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Options
to purchase 1,241,740 shares of common stock at prices ranging from $1.00 to $4.60 per
share were outstanding during the year ended December 31, 2004 (2003: options to purchase
1,711,000 shares of common stock at prices ranging from $1.00 to $4.25 per share and 2002:
options to purchase 3,686,000 shares of common stock at prices ranging from $0.25 to $3.50
per share), but were excluded from the computation of diluted EPS because the
options&#146; exercise prices were greater than the average market price of the
Company&#146;s common stock. </FONT>
</TD>
</TR>
</TABLE>
<BR>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 17</FONT></P>



<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>K. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 11</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
accounting for the stock options to consultants, the Company considered SFAS 123, EITF
96-18 and EITF 00-18. On September 1, 2002, Water$avr Global Solutions Inc.
(&#147;<U>Water$avr</U>&#148;) a wholly-owned subsidiary of the Company, entered into an
agreement with Ondeo Nalco Company (&#147;<U>Ondeo Nalco</U>&#148;) wherein Ondeo Nalco
was appointed an exclusive distributor of Water$avr chemicals in certain markets and a
non-exclusive distributor in others. As part of the agreement Ondeo Nalco had to make at
least a threshold amount of purchases during the eighteen month period following the
signing of the contract. If Ondeo Nalco was unable to meet the threshold purchases, then
the exclusive distributorships would convert to non-exclusive. As an incentive to attain
the threshold targets, Ondeo Nalco was to be paid $500,000. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
term of the agreement was for a period of five years. However, the agreement had a
termination clause which could be triggered by either party effective immediately upon
written notice to the other party if the other party: (i) breached any provision of the
agreement and failed to cure such breach to the satisfaction of the terminating party
within thirty days after such notice from the terminating party; (ii) files a voluntary
petition under bankruptcy; or (iii) becomes insolvent. Ondeo Nalco also had a specific
right to terminate the agreement at any time upon six months written notice. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
an appendix to the agreement, the Company granted Ondeo Nalco options to acquire 1,000,000
shares of the Company at $4.25 per share and other options to acquire 1,000,000 shares of
the Company at $5.50 per share. Overall the Company granted 2,000,000 stock options to
Ondeo Nalco that were exercisable and vested immediately and expired at the earlier of
five years or the termination of the agreement. During the year ended December 31, 2003,
Ondeo Nalco breached the terms of the agreement by not purchasing a sufficient amount of
chemicals and consequently the agreement was terminated and the stock options were
cancelled. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
stated in its notes to financial statements, the Company applies the fair value based
method of accounting for stock options as set out in SFAS 123. The Company applied the
accounting policies of SFAS 123 for stock options granted to consultants and followed the
guidelines of EITF 96-18 and EITF 00-18 to determine the measurement date and the periods
of expensing. Although SFAS 123 establishes the measurement principles for transactions of
stock options for consultants and states that those transactions should be measured at
fair value, it does not address the measurement date or the periods of recognition of the
cost of the transactions. SFAS 123 does not also deal with stock options issued in
conjunction with sales activities. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EITF
96-18 and EITF 00-18 address the measurement date and the recognition approach for stock
options issued to consultants as sales incentives. The EITF states that a company should
measure the fair value of the equity instruments using the stock price and other
measurement assumptions as of the earlier of either of the following: </FONT></P>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 18</FONT></P>



<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The date at which a commitment for performance by the counterparty to earn the
          equity instruments is reached (a performance commitment). In order for the
          contract to have a performance commitment the commitment to perform must be
          probable and evidenced by a sufficient disincentive for non-performance. A
          forfeiture of the stock options as the sole remedy in the event of the
          consultants non-performance is not considered a sufficient disincentive. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The date at which the counterparty&#146;s performance is complete. The
          counterparty&#146;s performance is considered complete when the counterparty has
          purchased the goods in accordance with the agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the Company&#146;s particular circumstances, in order to determine the measurement date it
considered the performance commitment above and the date at which the counterparty&#146;s
performance was complete. The Company believed that the measurement date could not be
based on the date at which a commitment for performance was reached as there was no
disincentive factors built into the agreement to compel Ondeo Nalco to perform according
to the agreement. Ondeo Nalco had a specific provision in the agreement to cancel the
agreement any time with six months written notice. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company then determined that the measurement date should be based on the date that the
counterparty&#146;s performance was complete. Based on a strict interpretation of these
criteria, the measurement date could have been at the end of the eighteen month period,
the period after significant milestones had been met. However, the EITF Task Force
subsequently discussed situations in which counterparty performance may be required over a
period of time, but the equity awards granted to the party performing the services is
fully vested and non-forfeitable on the date the parties entered into the contract. The
committee then determined that a reasonable interpretation of this clause is that the
measurement date for an award that is non-forfeitable and that vests immediately could be
the date the parties entered into the contract even though services had not yet been
performed. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
stock options issued to Ondeo Nalco did vest immediately, but were forfeitable in the case
that the agreement was terminated. EITF 00-18 states that to achieve a measurement date,
no specific future performance must be required by the grantee to earn the equity
instruments. The EITF Task Force concluded that by eliminating any obligation on the part
of the counterparty to earn the equity instruments, a measurement date had been reached.
In the Company&#146;s case, the stock options were fully vested and could be exercised by
the counterparty regardless of future performance or the lack thereof. The stock options
were only forfeited if the agreement was terminated. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
EITF Task Force did not address the periods or manner in which the fair value of the
transactions should be recognized, but it did recognize that the transaction should be
recognized in the same periods (capitalize versus expense) as if the enterprise had paid
cash for the goods or services instead of using equity instruments and noted that all
facts and circumstances should be considered. </FONT></P>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 19</FONT></P>



<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
granting of the stock options in 2002 resulted in the Company recording an expense of
roughly $2.48 million based on the principles of SFAS 123 and the guidance set out in
EITFs&#146; 96-18 and 00-18. The Company expensed the entire amount of the stock options
on the basis of being conservative and recognizing the fact that the stock options did
vest immediately and were not tied to the overall performance of the consultant to attain
the sales targets. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company also followed the guidance of SFAS 123 in relation to the forfeiture provisions of
the stock options. According to SFAS 123, the Company has the option to recognize an
allowance for stock options that may forfeit in the year the options are granted or
recognize the forfeitures by reversing the amount expensed in prior periods that relate to
the options actually forfeited. In 2002 the Company recognized the cost of the stock
options by recognizing an expense for the entire amount of the stock options that vested.
It then reversed the entire amount of the stock options expensed in 2003 when the
agreement was terminated and the stock options were forfeited. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<B>L. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Response
to SEC Comment 12</U></B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s amendment to the Form 10-KSB, when filed, will be revised in response to
this comment as follows: </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
May 1, 2003, the Company filed a lawsuit in the Supreme Court of British Columbia, Canada,
against John Wells and Equity Trust, S.A. seeking return of 100,000 shares of the
Company&#146;s common stock and repayment of a $25,000 loan, which were provided to
defendants for investment banking services consisting of securing a $5 million loan and a
$25 million stock offering.<B> </B>Such services were not performed and in the proceeding,
the Company seeks return of such shares after defendant&#146;s failure to both return the
shares voluntarily and repay the note. On May 7, 2003 the Company obtained an injunction
freezing the transfer of the shares. On May 24, 2004 there was a hearing on
defendant&#146;s motion to set aside the injunction, which motion was denied by the trial
court on May 29, 2004. The proceeding is still in a discovery phase. On the date of
issuance, the share transaction was recorded as shares issued for services at fair market
value, a value of $0.80 per share. No amounts have been recorded as receivable in the
Company&#146;s consolidated financial statements as the outcome of this claim is not
determinable. </FONT>
</TD>
</TR>
</TABLE>
<BR>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 20</FONT></P>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
November 13, 2003, Patrick Grant filed a lawsuit in the Circuit Court of Cook County,
Illinois against the Company, Water$avr Global Solutions Inc. (&#147;WGS&#148;), the
wholly-owned subsidiary of the Company, and Daniel B. O&#146;Brien , the Company&#146;s
Chief Executive Officer. The plaintiff claims damages for breach of contract, tortious
interference with an agreement and various wrongful discharge claims. The plaintiff seeks
monetary damages in excess of $1,020,000 for the breach of contract and tortious
interference claims and unspecified compensatory and punitive damages in the wrongful
discharge claims. The parties completed mandatory mediation ordered by the Circuit Court
and will next appear in court for case management, at which time the court will set
discovery deadlines. The Company considers the case without merit and is planning to
dispute the matter vigorously. In addition, the Company intends to file counterclaims
against the plaintiff for failure to repay financial obligations owed to the Company of
almost $40,000, as well as unspecified damages arising out of Plaintiff&#146;s disclosure
of confidential information to a client during his employment at WGS. No amounts have been
recorded as receivable and no accrual has been made for any loss in the Company&#146;s
consolidated financial statements as the outcome of the claim filed by Mr. Grant is not
determinable. </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
May 28, 2004, Sunsolar Energy Technologies Inc. (&#147;SET&#148;), filed a lawsuit in the
Federal Court of Canada, against the Company, Flexible Solutions, Ltd., the Company&#146;s
wholly-owned subsidiary (&#147;FSL&#148;), and Mr. O&#146;Brien. SET is seeking: (a) a
declaration that the trademark &#147;Tropical Fish&#148; is available for use by SET; (b)
injunctive relief against further use of the &#147;Tropical Fish&#148; trademark by the
Company; and (c) monetary damages exceeding $7,000,000 for the alleged infringement by the
Company, FSL and Mr. O&#146;Brien of the &#147;Tropical Fish&#148; trademark, as well as
any other &#147;confusingly similar trademarks&#148; or proprietary trade dresses. On
August 9, 2004, the Company, FSL and Mr. O&#146;Brien filed their defense and filed a
counterclaim against SET. The counterclaim seeks: (x) injunctive relief against further
use of the &#147;Tropical Fish&#148; trademark by SET; (y) a declaration that the
&#147;Tropical Fish&#148; trademark is owned by the Company, or, in the alternative, is
not distinctive and should be struck from the trademark registry; and (z) monetary damages
exceeding $50,000. The parties have completed documentary discovery, and examinations for
discovery of all parties have been scheduled for July 2005. No amounts have been recorded
as receivable in the Company&#146;s consolidated financial statements and no amounts have
been accrued as potential losses as the outcome of this claim is not determinable. </FONT>
</TD>
</TR>
</TABLE>
<BR>





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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 21</FONT></P>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
July 23, 2004, the Company filed a breach of contract suit in the Circuit Court of Cook
County, Illinois against Tatko Biotech Inc. (&#147;<U>Tatko</U>&#148;). The action arises
out of a joint product development agreement entered into between the Company and Tatko in
which the Company agreed to invest $10,000 toward the product development venture and
granted to Tatko 100,000 shares of the Company&#146;s restricted common stock. In return,
Tatko granted the Company a five-year option to purchase 20% of Tatko&#146;s outstanding
capital stock. Tatko has since refused to collaborate on the agreement and the Company
seeks declaratory relief stating that Tatko is not entitled to the 100,000 shares of the
Company&#146;s restricted common stock. The litigation is still pending at this time. </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
addition, Tatko filed its own suit on September 24, 2004 in the Circuit Court of Cook
County, Illinois seeking declaratory relief of its entitlement to the Company&#146;s
restricted common stock. On May 23, 2005, the Tatko suit was dismissed with prejudice by
the District Court. </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=20%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
amounts have been recorded as receivable in the Company&#146;s consolidated financial
statements and no amount has been accrued as a loss as the outcome of the claim against
Tatko is not determinable. </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;With
respect to its obligation to file an amendment to its Form S-3 (Amendment No. 2), Form
10-KSB and its Form 10-QSB, the Company respectfully requests permission to file such
amended documents promptly following the resolution with the Commission of the issues
discussed hereinabove. </FONT></P>


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<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ms. Pamela A. Long<BR>
Securities and Exchange Commission<BR>
August 11, 2005<BR>
Page 22</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
you have any further comments regarding this letter, the responses contained herein or the
proposed responses to the Form S-3 (Amendment No. 2), Form 10-KSB or Form 10-QSB, please
contact directly the attorney for the Company, Deepak Nanda, at (310) 975-7912 with any
questions or comments regarding this matter. Mr. Nanda&#146;s facsimile number is (310)
557-8475. </FONT></P>


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     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Very truly yours,</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>FLEXIBLE SOLUTIONS INTERNATIONAL, INC.</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>/s/ Daniel B. O'Brien&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Daniel B. O'Brien</FONT></TD></TR>
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     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>President and Chief Executive Officer</FONT></TD></TR>
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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>cc:  </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Chris
Edwards (via EDGAR only)<BR>Matt Franker (via EDGAR only)<BR>Nudrat Salik (via EDGAR only)<BR>Marie Trimeloni (via EDGAR only)<BR>Paul A. Stewart<BR>
Andrew B. Serwin<BR>Deepak Nanda</FONT></TD>
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