SECURITY AGREEMENT

                              SECURITY AGREEMENT


OWNER OF
COLLATERAL: Scientific Packaging Industries, Inc.                         
70 Orville Drive, Bohemia, NY 11716
_______________________________________________________________________
DESCRIPTION OF COLLATERAL: The undersigned as guarantor ("Guarantor"),
to secure the debt of Scientific Industries, Inc. ("Borrower"), hereby
grants to Capital One, N.A. (the "Bank") a security interest (see Right
to Repossess Section below for explanation of "security interest") in
the following described collateral ("Collateral"):   All Assets of the
Guarantor perfected through UCC-1 lien filings.

OBLIGATIONS: The obligations that this agreement is to secure are:
1. The amount of $500,000.00, which amount represents a loan made on
even date herewith by the Bank to Borrower, as evidenced by a certain
note dated as of even date herewith executed by Borrower promising,
among other things, to pay the Bank, together with interest due and
extensions and renewals thereof, plus all costs of collection
in the event of default, including attorney's fees. 2. Any and all
other liabilities of Borrower to the Bank under this agreement.
3. Any and all other liabilities of Borrower to the Bank, direct or
indirect, absolute or contingent, present or future, due or to
become due. Borrower agrees to promptly pay all obligations when due.
STATEMENT OF OWNER: Owner states and promises that:
1. The Collateral is bought or used primarily for: [   ]Personal,
family of household purposes; [   ]Farming operations; [ X ]Business,
and, if checked here, [   ]is being acquired with the proceeds of a
loan signed at the same time as this agreement and the Bank may pay
those proceeds directly to the seller of the Collateral.   2. The
Collateral is or is to be located at address shown above
(or at ____________________).
(Address if Collateral is to be kept elsewhere)
3. The Collateral will not be attached to real estate unless indicated
here:
_____________________________________
(Description of real estate by Street, Number,
_____________________________________
(Town or City, County & State)
_____________________________________
(Name and address of owner of real estate)

If the Collateral is to be attached to real estate and if the Bank
requests it, Guarantor agrees to furnish the Bank with statements
signed and notarized by everybody who has an interest in that real
estate stating that they claim no interest in the Collateral.
Guarantor gives the Bank permission to file a financing statement
(notice of the Bank 's security interest filed for public record)
covering the Bank's security interest without Guarantor's signature
on it. Upon request of the Bank, Guarantor or Borrower will pay all
filing fees to protect the Bank's security interest on the Collateral.
The Bank may charge those fees to any account Guarantor or Borrower
has with the Bank.  
INSURANCE REQUIREMENTS: Guarantor will keep the Collateral insured
against fire, including so-called extended coverage, theft and if the
Collateral is a motor vehicle, Guarantor will also maintain $500
deductible collision insurance. The limits and terms of the coverage
and the insurance company must be satisfactory to the Bank. If the Bank
requires additional insurance on the Collateral, Guarantor will obtain
and maintain the additional cover