As filed with the Securities and Exchange Commission on August 15, 2000
                                            Registration No. 333-
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    ---------

                                    FORM S-8
             REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
                                   ----------

                           TURBODYNE TECHNOLOGIES INC.
             (Exact name of registrant as specified in its charter)

                  Delaware                           95-4699061
         (State or other jurisdiction             (I.R.S. Employer
      of incorporation or organization)          Identification No.)

           6155 Carpinteria Avenue                     93013
           Carpinteria, California                   (Zip code)
   (Address of principal executive offices)

                                  --------
                         2000 STOCK INCENTIVE PLAN
                          (Full title of the plan)
                                 ----------

                             Joseph D. Castano
                          Chief Financial Officer
                        Turbodyne Technologies Inc.
                          6155 Carpinteria Avenue
                       Carpinteria, California 93013
                  (Name and address of agent for service)

                               (805) 684-4551
       (Telephone number, including area code, of agent for service)

                                  Copy to:

                           PETER M. MENARD, ESQ.
                  Sheppard, Mullin, Richter & Hampton LLP
                     333 South Hope Street, 48th Floor
                       Los Angeles, California 90071
                               (213) 617-5483

                      CALCULATION OF REGISTRATION FEE
================================================================================
                                      Proposed        Proposed
                       Amount          maximum         maximum        Amount of
Title of securities    to be       offering price     aggregate     registration
 to be registered   registered (1)   per share (2)  offering price       fee
--------------------------------------------------------------------------------
Common Stock, $.001   4,800,000         $.75         $3,600,000       $1,062.00
   par value
================================================================================

(1)   This Registration Statement covers, in addition to the number of shares of
      Common Stock stated above, such  indeterminate  number of shares of Common
      Stock as may be issued  upon  exercise of options  granted  under the 2000
      Stock Incentive Plan as a result of the adjustment provisions thereof.

(2)   Estimated   solely  for  purposes  of   calculating   the  amount  of  the
      registration  fee  pursuant  to Rule 457 based upon the last sale price of
      the Common Stock as reported by CNBC on the pink sheets on August 8, 2000.
================================================================================

         This Registration Statement Includes a Total of 35 Pages.
                     Exhibit Index Appears on Page 12
                                                                   Page 1 of 35
<PAGE>



                                   PART I

            INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

            The document(s)  containing the  information  specified in Part I of
Form of S-8 will be sent or given to  participants  in the 2000 Stock  Incentive
Plan (the "Plan") of Turbodyne  Technologies  Inc., a Delaware  corporation (the
"Registrant"),  as specified in Rule 428(b)(1) promulgated by the Securities and
Exchange  Commission  (the  "Commission")  under the  Securities Act of 1933, as
amended (the  "Securities  Act").  Such document(s) are not being filed with the
Commission either as part of this  Registration  Statement or as prospectuses or
prospectus  supplements pursuant to Rule 424 in accordance with the Note to Part
I of Form S-8. These documents and the documents  incorporated by reference into
this  Registration  Statement  pursuant to Item 3 of Part II of Form S-8,  taken
together,  constitute a prospectus that meets the  requirements of Section 10(a)
of the Securities Act.








































                                     I-1
                                                                   Page 2 of 35
<PAGE>



                                  PART II

             INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.  Incorporation of Documents by Reference.
         ---------------------------------------

            The following documents  previously filed by the Registrant with the
Commission are incorporated in this Registration Statement by reference:

            (a)  The Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1999;

            (b)  All other reports filed by the Registrant  pursuant to Sections
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), since the end of the fiscal year ended December 31, 1999; and

            (c)  The description of the Common Stock of the Registrant contained
in the  Registrant's  Registration  Statement on Form S-1  (Commission  File No.
333-65207),  including any amendment or report filed for the purpose of updating
such description.

            All documents  filed by the  Registrant  pursuant to Section  13(a),
13(c),  14 or  15(d)  of the  Exchange  Act  subsequent  to  the  date  of  this
Registration  Statement  and prior to the filing of a  post-effective  amendment
which  indicates  that all  securities  offered  hereby  have been sold or which
deregisters  all  securities  then  remaining  unsold,  shall  be  deemed  to be
incorporated  by reference  into this  Registration  Statement  and to be a part
hereof from the date of filing of such documents.

            Any  statement  made in a  document  incorporated  or  deemed  to be
incorporated  by reference  herein shall be deemed to be modified or  superseded
for  purposes  of this  Registration  Statement  to the extent  that a statement
contained  herein  or in any other  subsequently  filed  document  which is also
incorporated  or deemed to be  incorporated  by  reference  herein  modifies  or
supersedes  such statement.  Any such statement so modified or superseded  shall
not be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.

Item 4.  Description of Securities.
         -------------------------

            Not applicable.

Item 5.  Interests of Named Experts and Counsel.
         --------------------------------------

            Not applicable.

Item 6.  Indemnification of Directors and Officers.
         -----------------------------------------

            Section 145 of the Delaware  General  Corporation Law (the "Delaware
Law") grants corporations the power to indemnify directors,  officers, employees
and agents in accordance with the provisions thereof.

                                   II-1
                                                                   Page 3 of 35
<PAGE>



            Section 102(b)(7) of the Delaware Law grants  corporations the power
to eliminate a director's personal liability for monetary damages to the Company
or its  stockholders  for  breach of  fiduciary  duty as a  director,  except in
circumstances  involving a breach of a director's duty of loyalty to the Company
of its  stockholders,  acts or  omissions  not in good  faith or  which  involve
intentional  misconduct or knowing  violations of the law,  self-dealing  or the
unlawful payment of dividends or repurchase of stock.

            Article X of the Registrant's Certificate of Incorporation provides:

            The Corporation  shall indemnify to the fullest extent authorized or
permitted by law (as now or hereafter in effect) any person made,  or threatened
to be made, a defendant or witness to any action,  suit or  proceeding  (whether
civil or criminal or otherwise) by reason of the fact that she or he, her or his
testator or intestate, is or was a director,  officer,  employee or agent of the
Corporation  or by reason of the fact that any  person is or was  serving at the
request of the Corporation as a director,  officer, employee or agent of another
corporation,  partnership,  joint  venture,  trust,  employee  benefit  plan  or
enterprise.  Nothing contained herein shall affect any rights to indemnification
to which  employees other than directors and officers may be entitled by law. No
amendment  or repeal of this  paragraph  of Article X shall apply to or have any
effect on any right to  indemnification  provided  hereunder with respect to any
acts or omissions occurring prior to such amendment or repeal.

            No director of the  Corporation  shall be  personally  liable to the
Corporation or its stockholders for monetary damages for any breach of fiduciary
duty by such a director as a director. Notwithstanding the foregoing sentence, a
director  shall be liable to the extent  provided by applicable  law (i) for any
breach of the director's duty of loyalty to the Corporation or its stockholders,
(ii) for acts or  omissions  not in good  faith  or  which  involve  intentional
misconduct or a knowing  violation of law,  (iii) pursuant to Section 174 of the
Delaware Law, or (iv) for any  transaction  form which such director  derived an
improper  personal  benefit.  No  amendment  to or repeal of this  paragraph  of
Article  X shall  apply  to or have  any  effect  on the  liability  or  alleged
liability of any director of the  Corporation for or with respect to any acts or
omissions of such director occurring prior to such amendment or repeal.

            In  furtherance  and not in  limitation  of the powers  conferred by
statute:

                        (i)  the Corporation may purchase and maintain insurance
on behalf of any person who is or was a director or  officer,  employee or agent
of the  Corporation,  or is  serving  at the  request  of the  Corporation  as a
director, officer, employee or agent of another corporation,  partnership, joint
venture,  trust, employee benefit plan or other enterprise against any liability
asserted against him or her and incurred by him or her in any such capacity,  or
arising out of his or her status as such,  whether or not the Corporation  would
have the power to indemnify  against such liability under the provisions of law;
and






                                   II-2
                                                                   Page 4 of 35
<PAGE>



                       (ii)  the Corporation may  create a  trust fund,  grant a
security interest and/or use other means (including, without limitation, letters
of credit,  surety bonds and/or other  similar  arrangements),  as well as enter
into  contract  providing  indemnification  to the  full  extent  authorized  or
permitted by law and including as part thereof provisions with respect to any or
all of the  foregoing  to ensure  the  payment  of such  amounts  as may  become
necessary to effect indemnification as provided therein, or elsewhere.

            Article XI, Section 43 of the Registrant's Bylaws provides:

            Section 43.  INDEMNIFICATION OF DIRECTORS, EXECUTIVE OFFICERS, OTHER
OFFICERS, EMPLOYEES AND OTHER AGENTS.

            (a)  DIRECTORS   OFFICERS.   The  corporation  shall  indemnify  its
directors  and  officers to the fullest  extent not  prohibited  by the Delaware
General Corporation Law; provided,  however, that the corporation may modify the
extent of such  indemnification  by individual  contracts with its directors and
officers; and, provided,  further, that the corporation shall not be required to
indemnify any director or officer in  connection  with any  proceeding  (or part
thereof)  initiated by such person unless (i) such  indemnification is expressly
required to be made by law, (ii) the  proceeding  was authorized by the Board of
Directors  of the  corporation,  (iii) such  indemnification  is provided by the
corporation,  in its sole  discretion,  pursuant  to the  powers  vested  in the
corporation   under  the  Delaware   General   Corporation   Law  or  (iv)  such
indemnification is required to be made under subsection (d).

            (b)  EMPLOYEES AND OTHER AGENTS.  The  corporation  shall have power
to indemnify its employees and other agents as set forth in the Delaware General
Corporation Law.

            (c)  EXPENSE. The corporation shall advance to any person who was or
is a party or is  threatened  to be made a party to any  threatened,  pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he is or was a director or officer, of
the  corporation,  or is or was serving at the request of the  corporation  as a
director  or  executive  officer  of  another  corporation,  partnership,  joint
venture,  trust  or other  enterprise,  prior to the  final  disposition  of the
proceeding,  promptly  following request therefor,  all expenses incurred by any
director  or officer  in  connection  with such  proceeding  upon  receipt of an
undertaking  by or on behalf of such person to repay said mounts if it should be
determined  ultimately that such person is not entitled to be indemnified  under
this Bylaw or otherwise.

            Notwithstanding the foregoing,  unless otherwise determined pursuant
to paragraph (e) of this Bylaw,  no advance shall be made by the  corporation to
an officer of the corporation (except by reason of the fact that such officer is
or was a director of the  corporation  in which event this  paragraph  shall not
apply)  in  any  action,   suit  or   proceeding,   whether   civil,   criminal,
administrative or  investigative,  if a determination is reasonably and promptly
made (i) by the Board of Directors by a majority vote of a quorum  consisting of
directors who were not parties to the proceeding,  or (ii) if such quorum is not
obtainable,  or, even if  obtainable,  a quorum of  disinterested  directors  so
directs, by independent legal counsel in a written opinion, that the facts known
to the decision-making  party at the time such determination is made demonstrate


                                   II-3
                                                                   Page 5 of 35
<PAGE>



clearly and convincingly that such person acted in bad faith or in a manner that
such person did not believe to be in or not opposed to the best interests of the
corporation.

            (d)  ENFORCEMENT.  Without the necessity of entering into an express
contract,  all rights to indemnification  and advances to directors and officers
under this Bylaw shall be deemed to be  contractual  rights and be  effective to
the same extent and as if provided for in a contract between the corporation and
the director or officer.  Any right to  indemnification  or advances  granted by
this Bylaw to a director or officer shall be  enforceable by or on behalf of the
person  holding  such right in any court of  competent  jurisdiction  if (i) the
claim for indemnification or advances is denied, in whole or in part, or (ii) no
disposition  of such claim is made within ninety (90) days of request  therefor.
The claimant in such  enforcement  action,  if  successful  in whole or in part,
shall be  entitled  to be paid also the  expense of  prosecuting  his claim.  In
connection with any claim for indemnification, the corporation shall be entitled
to raise as a  defense  to any such  action  that the  claimant  has not met the
standard  of  conduct  that  make it  permissible  under  the  Delaware  General
Corporation  Law for the  corporation  to indemnify  the claimant for the amount
claimed.  In connection with any claim by an officer of the corporation  (except
in any action, suit or proceeding,  whether civil,  criminal,  administrative or
investigative,  by reason of the fact that such  officer is or was a director of
the  corporation)  for advances,  the  corporation  shall be entitled to raise a
defense as to any such action  clear and  convincing  evidence  that such person
acted in bad faith or in a manner  that such  person did not believe to be in or
not opposed in the best  interests  of the  corporation,  or with respect to any
criminal action or proceeding that such person acted without reasonable cause to
believe  that his  conduct was  lawful.  Neither the failure of the  corporation
(including   its  Board  of   Directors,   independent   legal  counsel  or  its
stockholders)  to have made a  determination  prior to the  commencement of such
action  that  indemnification  of the  claimant  is proper in the  circumstances
because he has met the applicable  standard of conduct set forth in the Delaware
General  Corporation  Law,  nor  an  actual  determination  by  the  corporation
(including   its  Board  of   Directors,   independent   legal  counsel  or  its
stockholders) that the claimant has not met such applicable standard of conduct,
shall be a defense to the action or create a  presumption  that claimant has not
met the  applicable  standard of conduct.  In any suit  brought by a director or
officer to enforce a right to  indemnification  or to an advancement of expenses
hereunder, the burden of proving that the director or officer is not entitled to
be  indemnified,  or to such  advancement of expenses,  under this Article XI or
otherwise shall be on the corporation.

            (e)  NON-EXCLUSIVITY OF RIGHTS.  The  rights conferred on any person
by this Bylaw  shall not be  exclusive  of any other right which such person may
have or hereafter  acquire under any statute,  provision of the  Certificate  of
Incorporation,   Bylaws,   agreement,  vote  of  stockholders  or  disinterested
directors or  otherwise,  both as to action in his  official  capacity and as to
action in another capacity while holding office. The corporation is specifically
authorized to enter into individual  contracts with any or all of its directors,
officers,  employees or agents respecting  indemnification and advances,  to the
fullest extent not prohibited by the Delaware General Corporation Law.





                                   II-4
                                                                   Page 6 of 35
<PAGE>



            (f)  SURVIVAL OF RIGHTS.  The rights conferred on any person by this
Bylaw shall  continue  as to a person who has ceased to be a director,  officer,
employee or other  agent and shall inure to the benefit of the heirs,  executors
and administrators of such a person.

            (g)  INSURANCE.  To the fullest  extent  permitted  by the  Delaware
General  Corporation  Law,  the  corporation,  upon  approval  by the  Board  of
Directors,  may purchase insurance on behalf of any person required or permitted
to be indemnified pursuant to this Bylaw.

            (h)  AMENDMENTS. Any repeal or modification of this Bylaw shall only
be prospective and shall not affect the rights under this Bylaw in effect at the
time of the  alleged  occurrence  of any action or  omission  to act that is the
cause of any proceeding against any agent of the corporation.

            (i)  SAVING  CLAUSE. If this Bylaw or any  portion  hereof  shall be
invalidated  on any  ground by any  court of  competent  jurisdiction,  then the
corporation shall  nevertheless  indemnify each director and officer to the full
extent not  prohibited  by any  applicable  portion of this Bylaw that shall not
have been invalidated, or by any other applicable law.

            (j)  CERTAIN DEFINITIONS.   For  the  purposes  of  this  Bylaw, the
following definitions shall apply:

                        (i)  The  term  "proceeding"  shall be broadly construed
and  shall  include,   without  limitation,   the  investigation,   preparation,
prosecution,  defense, settlement,  arbitration and appeal of, and the giving of
testimony in, any threatened,  pending or completed action,  suit or proceeding,
whether civil, criminal, administrative or investigative.

                       (ii)  The term "expenses" shall be broadly construed and
shall include,  without limitation,  court costs, attorneys' fees, witness fees,
fines,  amounts paid in  settlement or judgment and any other costs and expenses
of any nature or kind incurred in connection with any proceeding.

                      (iii)  The  term  the   "corporation"  shall  include,  in
addition to the resulting  corporation,  any constituent  corporation (including
any constituent of a constituent)  absorbed in a consolidation  or merger which,
if its separate  existence had continued,  would have had power and authority to
indemnify its directors,  officers,  and employees or agents, so that any person
who is or was a  director,  officer,  employee  or  agent  of  such  constituent
corporation, or is or was serving at the request of such constituent corporation
as a director,  officer, employee or agent or another corporation,  partnership,
joint venture, trust or other enterprise, shall stand in the same position under
the  provisions  of this  Bylaw  with  respect  to the  resulting  or  surviving
corporation as he would have with respect to such constituent corporation if its
separate existence had continued.

                       (iv)  Reference  to  a  "director,"  "executive officer,"
"officer,"  "employee," or "agent" of the  corporation  shall  include,  without
limitation,  situations  where  such  person is  serving  at the  request of the
corporation as, respectively,  a director, executive officer, officer, employee,
trustee or agent of another corporation,  partnership,  joint venture,  trust or
other enterprise.

                                      II-5
                                                                   Page 7 of 35
<PAGE>



                        (v)  References  to  "other enterprises"  shall  include
employee  benefit  plans;  references  to "fines" shall include any excise taxes
assessed on a person with respect to an employee benefit plan; and references to
"serving  at the  request of the  corporation"  shall  include  any service as a
director, officer, employee or agent of the corporation which imposes duties on,
or involves services by, such director, officer, employee, or agent with respect
to an employee benefit plan, its participants,  or  beneficiaries;  and a person
who  acted in good  faith and in a manner he  reasonably  believed  to be in the
interest of the participants and beneficiaries of an employee benefit plan shall
be deemed to have acted in a manner "not  opposed to the best  interests  of the
corporation" as referred to in this Bylaw.

Item 7.  Exemption from Registration Claimed.
         -----------------------------------

            Not applicable.

Item 8.  Exhibits.
         --------

    Exhibit
    Number  Description
    ------  -----------

      3.1   Certificate of Incorporation of the Registrant(1)
      3.2   Bylaws of the Registrant(1)
      5.1   Opinion of Sheppard, Mullin, Richter & Hampton LLP
     23.1   Consent of Sheppard, Mullin, Richter & Hampton LLP (see Exhibit 5.1)
     23.2   Consent of Independent Auditors (McGowan Guntermann)
     24.1   Power of Attorney (See page II-7)
     99.1   2000 Stock Incentive Plan
     99.2   Form of Incentive Stock Option Agreement
     99.3   Form of Non-Qualified Stock Option Agreement

Item 9.  Undertakings.
         ------------

            (a)  The undersigned Registrant hereby undertakes:

                 (1)  To file,  during any  period in which  offers or sales are
being made, a post-effective amendment to this Registration Statement:

                        (i)  To  include  any  prospectus  required  by  Section
10(a)(3) of the Securities Act of 1933;

                       (ii)  To  reflect  in  the prospectus any facts or events
arising after the  effective  date of this  Registration  Statement (or the most
recent post-effective amendment hereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this Registration
Statement; and

--------

(1)    Filed as an exhibit to the  Registrant's  Form 10-Q for the quarter ended
       June 30, 1998 filed with the Securities and Exchange Commission.

                                      II-6
                                                                   Page 8 of 35
<PAGE>



                      (iii)  To include any material information with respect to
the plan of distribution not previously disclosed in this Registration Statement
or any material change to such information in this Registration Statement;

            Provided,  however,  that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information  required to be included in a post-effective  amendment
by those  paragraphs is contained in periodic reports filed with or furnished to
the Commission by the Registrant  pursuant to Section 13 or Section 15(d) of the
Securities  Exchange  Act of 1934 that are  incorporated  by  reference  in this
Registration Statement.

                 (2)  That for the purpose of  determining  any liability  under
the Securities Act of 1933, each such  post-effective  amendment shall be deemed
to be a new registration  statement  relating to the securities offered therein,
and the  offering  of such  securities  at that  time  shall be deemed to be the
initial bona fide offering thereof.

                 (3)  To remove from  registration by means of a  post-effective
amendment  any of the  securities  being  registered  which remain unsold at the
termination of the offering.

            (b)  The undersigned Registrant hereby undertakes that, for purposes
of determining  any liability  under the Securities Act of 1933,  each filing of
the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities  Exchange  Act of 1934  that is  incorporated  by  reference  in this
Registration  Statement  shall  be  deemed  to be a new  registration  statement
relating to the securities  offered herein,  and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

            (c)  Insofar as indemnification  for  liabilities  arising under the
Securities  Act of 1933 may be permitted to directors,  officers or  controlling
persons of the Registrant  pursuant to the foregoing  provisions,  or otherwise,
the  Registrant  has been  advised  that in the  opinion of the  Securities  and
Exchange  Commission such  indemnification is against public policy as expressed
in the Securities  Act of 1933 and is,  therefore,  unenforceable.  In the event
that a claim  for  indemnification  against  such  liabilities  (other  than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling  person of the Registrant in the  successful  defense of any action,
suit or proceeding) is asserted by such director,  officer or controlling person
in connection with the securities being registered,  the Registrant will, unless
in the  opinion  of its  counsel  the matter  has been  settled  by  controlling
precedent,  submit to a court of appropriate  jurisdiction  the question whether
such  indemnification  by it is  against  public  policy  as  expressed  in  the
Securities  Act of 1933 and will be governed by the final  adjudication  of such
issue.








                                   II-7
                                                                   Page 9 of 35
<PAGE>

                                  SIGNATURES

            Pursuant to the  requirements  of the  Securities  Act of 1933,  the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized,  in the  City of Carpinteria,  State of California, on this 31st day
of July, 2000.

                                     TURBODYNE TECHNOLOGIES INC.

                                     By   /s/ Joseph D. Castano
                                          _____________________________________
                                           Joseph D. Castano,
                                           Chief Financial Officer and Secretary

            KNOW ALL MEN BY THESE  PRESENTS,  that each person  whose  signature
appears  below  constitutes  and appoints  each of Gerhard E. Delf and Joseph D.
Castano his true and lawful  attorney-in-fact and agent, each with full power of
substitution,  for  him  and in his  name,  place  and  stead,  in any  and  all
capacities, to sign any or all amendments to this Registration Statement, and to
file the same with all exhibits  thereto,  and all other documents in connection
therewith, with the Securities and Exchange Commission,  granting unto each said
attorney-in-fact  and agent with full power and authority to do and perform each
and every  act and thing  requisite  and  necessary  to be done in and about the
premises,  as  fully  to all  intents  and  purposes  as he might or could do in
person,  hereby ratifying and confirming all that each said attorney-in-fact and
agent, or his substitute, may lawfully do or cause to be done by virtue hereof.

            Pursuant  to the  requirements  of the  Securities  Act of 1933,  as
amended, this Registration Statement has been signed by the following persons in
the capacities and on the dates indicated.
<TABLE>
<CAPTION>
         Signature                           Title                                      Date
         ---------                           -----                                      ----
<S>                                <C>                                              <C>
/s/ Gerhard E. Delf
_____________________________      President and Chief Executive Officer            July 31, 2000
      Gerhard E. Delf

/s/ Peter Hofbauer
_____________________________      Chairman of the Board                            July 31, 2000
   Prof. Peter Hofbauer

/s/ Robert Taylor
_____________________________      Director                                         July 31, 2000
       Robert Taylor

/s/ Joseph D. Castano
_____________________________      Chief Financial Officer (Principal Financial     July 31, 2000
     Joseph D. Castano             and Accounting Officer) and Secretary

/s/ Sadayappa Durairaj
_____________________________      Director                                         July 31, 2000
  Dr. Sadayappa Durairaj

/s/ Wendall R. Anderson
_____________________________      Director                                         July 31, 2000
    Wendall R. Anderson

/s/ Peter Kitzinski
_____________________________      Director                                         July 31, 2000
      Peter Kitzinski

/s/ Daniel Geronazzo
_____________________________      Director                                         July 31, 2000
     Daniel Geronazzo

/s/ Friedrich Goes
_____________________________      Director                                         July 31, 2000
    Dr. Friedrich Goes
</TABLE>
                                                                  Page 10 of 35
<PAGE>



                                   EXHIBITS
                                      TO
                                   FORM S-8

            REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

                                ---------------

                          TURBODYNE TECHNOLOGIES INC.














































                                                                  Page 11 of 35
<PAGE>



                                 EXHIBIT INDEX


Exhibit                                                         Sequential
Number      Description                                         Page Number
------      -----------                                         -----------

  3.1       Certificate of Incorporation of the Registrant(1)
  3.2       Bylaws of the Registrant(1)
  5.1       Opinion of Sheppard, Mullin, Richter & Hampton LLP      13
 23.1       Consent of Sheppard, Mullin, Richter & Hampton LLP
               (see Exhibit 5.1)
 23.2       Consent of Independent Auditors (McGowan Guntermann)    16
 24.1       Power of Attorney (See page II-7)
 99.1       2000 Stock Incentive Plan                               17
 99.2       Form of Incentive Stock Option Agreement                24
 99.3       Form of Non-Qualified Stock Option Agreement            30


--------

(1)    Filed as an exhibit to the  Registrant's  Form 10-Q for the quarter ended
       June 30, 1998 filed with the Securities and Exchange Commission.
































                                                                  Page 12 of 35
<PAGE>


















                                                                    EXHIBIT 5.1
                                                                    -----------

                            August 14, 2000


Turbodyne Technologies Inc.
6155 Carpinteria Avenue
Carpinteria, California 93013


Re:   Registration Statement on Form S-8
      ----------------------------------


Gentlemen:

            At your request, we have examined the Registration Statement on Form
S-8 (the "Registration Statement") to be filed by Turbodyne Technologies Inc., a
Delaware   corporation  (the  "Company"),   with  the  Securities  and  Exchange
Commission (the "SEC") in connection with the registration  under the Securities
Act of 1933,  as amended (the  "Securities  Act"),  of  4,800,000  shares of the
Company's common stock (the "Common Stock"), that may be issued in the aggregate
pursuant to awards  granted under the Company's  2000 Stock  Incentive Plan (the
"Plan").

            In rendering  this  opinion,  we have  examined  only the  following
documents:

            1.   The  Certificate of Incorporation of the Company, as  certified
                 by the Delaware Secretary of State;

            2.   The Bylaws of the Company;

            3.   The Plan;

            4.   The forms of Incentive Stock Option Agreement and Non-Qualified
                 Stock Option Agreement  (collectively  the  "Agreements") to be
                 used in connection with the Plan;

                                                                  Page 13 of 35
<PAGE>


Turbodyne Technologies Inc.
August 14, 2000
Page 2


            5.   Resolutions, adopted by the Company's Board of Directors as of
                 July 31, 2000, and by the stockholders of the Company as of May
                 12,  2000,   pertaining  to  the  adoption  of  the  Plan,  the
                 Agreements and the Registration Statement; and

            6.   The Registration Statement.

            With  respect  to the  foregoing  documents,  we  have  assumed  the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals and the conformity to originals of all documents submitted to us as
certified or reproduced  copies.  We also have obtained from the officers of the
Company certificates as to all factual matters necessary for the purpose of this
opinion and,  insofar as this opinion is based on such matters of fact,  we have
relied on such certificates without independent investigation.

            Based  solely  upon the  foregoing  and  assuming,  without  further
inquiry,  that (i) all awards  granted under the Plan to date have been, and all
awards to be  granted  under  the Plan  will be,  duly and  validly  granted  in
accordance with the terms of the Plan, (ii) the  consideration for the shares of
Common Stock to be issued  pursuant to such awards will be received prior to the
issuance thereof, (iii) the shares of Common Stock to be issued pursuant to such
awards  will be  issued  in  accordance  with  the  terms  of the  Plan  and the
applicable  Agreement,  (iv) the  Registration  Statement will become  effective
under the  Securities  Act prior to the  issuance of any shares of Common  Stock
under  the  Plan  and  no  stop  order  suspending  the   effectiveness  of  the
Registration  Statement  shall  have been  issued  and no  proceedings  for that
purpose  shall  have  been   instituted  or  be  pending  before  the  SEC,  (v)
prospectuses  will be  updated  and  delivered  to  participants  in the Plan as
required by the Securities Act and the rules and regulations  promulgated by the
SEC thereunder,  and (vi) the grant of awards under the Plan and the issuance of
shares of Common Stock  pursuant to such awards will comply with the  securities
laws of each state or jurisdiction applicable thereto (other than the Securities
Act), upon which assumptions the following opinion is expressly conditioned,  it
is the opinion of the  undersigned  that the  4,800,000  shares of Common  Stock
issuable by the Company pursuant to awards granted pursuant to the Plan will be,
when issued and delivered  against payment therefor in accordance with the Plan,
the  applicable  Agreement  and the  Registration  Statement,  duly  authorized,
validly issued, fully paid and non-assessable.













                                                                  Page 14 of 35
<PAGE>


Turbodyne Technologies Inc.
August 14, 2000
Page 3

            This opinion is limited to the General  Corporation Law of the State
of Delaware and the Securities Act and the rules and regulations  promulgated by
the SEC thereunder,  to present judicial interpretations thereof and to facts as
they presently exist. In rendering this opinion, we have no obligation to revise
or  supplement  it  should  the  current  laws of the State of  Delaware  or the
Securities Act or such rules and  regulations be changed by legislative  action,
judicial  decision or  otherwise  or if we become aware of any facts that change
the opinion expressed herein after the date hereof.

            This opinion is issued to you solely for use in connection  with the
Registration  Statement and is not to be quoted or otherwise  referred to in any
financial  statements of the Company or related document,  nor is it to be filed
with or furnished to any  government  agency or other person,  without the prior
written consent of the undersigned in each instance.

            We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.

                                        Respectfully submitted,


                                    /s/ Sheppard, Mullin, Richter & Hampton LLP
                                    -------------------------------------------
                                        SHEPPARD, MULLIN, RICHTER & HAMPTON LLP





























                                                                  Page 15 of 35
<PAGE>


                                                                    EXHIBIT 23.2
                                                                    ------------



                         CONSENT OF INDEPENDENT AUDITORS
                         -------------------------------

             We consent to the  incorporation  by reference in the  Registration
Statement  (Form S-8 333-0000)  pertaining to the 2000 Stock  Incentive  Plan of
Turbodyne  Technologies  Inc. of our report  dated April 4, 2000 with respect to
the consolidated  financial statements and schedules for Turbodyne  Technologies
Inc. for the year ended  December 31, 1999 included in the Annual Report on From
10-K of Turbodyne Technologies Inc. for the year ended December 31, 1999.


                                                    /s/ McGowan Guntermann
                                                    -----------------------
                                                     MCGOWAN GUNTERMANN



Santa Barbara, California

August 1, 2000































                                                                  Page 16 of 35
<PAGE>
                                                                   EXHIBIT 99.1
                                                                   ------------


                           TURBODYNE TECHNOLOGIES INC.

                            2000 STOCK INCENTIVE PLAN



1.  PURPOSE OF THE PLAN.

The  purpose  of this 2000  Stock  Incentive  Plan (the  "Plan")  is to  provide
incentives and rewards to selected eligible directors,  officers,  employees and
consultants of Turbodyne  Technologies  Inc. (the "Company") or its subsidiaries
in order to assist the Company and its subsidiaries in attracting, retaining and
motivating  those  persons  by  providing  for  or  increasing  the  proprietary
interests of those persons in the Company, and by associating their interests in
the Company with those of the Company's stockholders.


2.  ADMINISTRATION OF THE PLAN.

The Plan shall be  administered  by the Board of  Directors  of the Company (the
"Board"),  or a committee of the Board (the  "Committee")  whose  members  shall
serve at the  pleasure  of the Board.  If  administration  is  delegated  to the
Committee,  the Committee shall have, in connection with the  administration  of
the Plan, the powers theretofore  possessed by the Board (and references in this
Plan to the Board shall thereafter be to the Committee),  subject,  however,  to
such  resolutions,  not  inconsistent  with the provisions of the Plan as may be
adopted from time to time by the Board.

The  Board  shall  have all the  powers  vested  in it by the terms of the Plan,
including  exclusive  authority  (i) to select  from among  eligible  directors,
officers,  employees and  consultants,  those persons to be granted "Awards" (as
defined  below) under the Plan;  (ii) to determine  the type,  size and terms of
individual  Awards  (which  need  not be  identical)  to be made to each  person
selected;  (iii) to  determine  the time  when  Awards  will be  granted  and to
establish objectives and conditions (including,  without limitation, vesting and
performance conditions),  if any, for earning Awards; (iv) to amend the terms or
conditions of any outstanding  Award,  subject to applicable legal  restrictions
and to the  consent  of the other  party to such  Award;  (v) to  determine  the
duration  and purpose of leaves of  absences  which may be granted to holders of
Awards  without  constituting  termination  of their  employment for purposes of
their Awards; (vi) to authorize any person to execute, on behalf of the Company,
any instrument required to carry out the purposes of the Plan; and (vii) to make
any  and all  other  determinations  which  it  determines  to be  necessary  or
advisable in the administration of the Plan. The Board shall have full power and
authority to administer  and  interpret the Plan and to adopt,  amend and revoke
such  rules,  regulations,   agreements,  guidelines  and  instruments  for  the
administration  of the Plan and for the  conduct  of its  business  as the Board
deems necessary or advisable.  The Board's  interpretation  of the Plan, and all
actions taken and determinations made by the Board pursuant to the powers vested
in it  hereunder,  shall be  conclusive  and binding on all  parties  concerned,
including the Company,  its  stockholders,  any participants in the Plan and any
other employee of the Company or any of its subsidiaries.


                                       1
                                                                  Page 17 of 35
<PAGE>



3.  PERSONS ELIGIBLE UNDER THE PLAN.

Any person who is a director, officer, employee or consultant of the Company, or
any of its  subsidiaries (a  "Participant"),  shall be eligible to be considered
for the grant of Awards under the Plan.


4.  AWARDS.

    (a)  COMMON STOCK AND DERIVATIVE  SECURITY AWARDS.  Awards  authorized under
         the Plan shall  consist of any type of  arrangement  with a Participant
         that is not  inconsistent  with the provisions of the Plan and that, by
         its terms,  involves or might involve or be made with  reference to the
         issuance of (i) shares of the Common Stock,  $.001 par value per share,
         of the Company (the "Common Stock") or (ii) a "derivative security" (as
         that term is defined in Rule 16a-1(c) of the Rules and  Regulations  of
         the Securities and Exchange  Commission  under the Securities  Exchange
         Act of 1934, as amended,  as the same may be amended from time to time)
         with an exercise or  conversion  price  related to the Common  Stock or
         with a value derived from the value of the Common Stock.

    (b)  TYPES OF AWARDS.  Awards are not  restricted to any  specified  form or
         structure and may include,  but need not be limited to, sales,  bonuses
         and other transfers of stock,  restricted stock, stock options,  reload
         stock options,  stock purchase warrants,  other rights to acquire stock
         or  securities   convertible  into  or  redeemable  for  stock,   stock
         appreciation rights,  phantom stock, dividend equivalents,  performance
         units or performance shares, or any other type of Award which the Board
         shall  determine is consistent  with the objectives and  limitations of
         the Plan. An Award may consist of one such security or benefit,  or two
         or more of them in tandem or in the alternative.

    (c)  CONSIDERATION.  Common Stock may be issued pursuant to an Award for any
         lawful  consideration  as determined by the Board,  including,  without
         limitation,  a cash payment,  services rendered, or the cancellation of
         indebtedness.

    (d)  GUIDELINES.  The Board  may  adopt,  amend or revoke  from time to time
         written policies  implementing the Plan. Such policies may include, but
         need not be limited to, the type, size and term of Awards to be made to
         participants and the conditions for payment of such Awards.

    (e)  TERMS AND CONDITIONS. Subject to the provisions of the Plan, the Board,
         in its sole and absolute  discretion,  shall determine all of the terms
         and conditions of each Award granted  pursuant to the Plan, which terms
         and conditions may include, among other things:

         (i)  any provision  necessary for such Award to qualify as an incentive
              stock  option under  Section 422 of the  Internal  Revenue Code of
              1986, as amended (the "Code") (an "Incentive Stock Option");





                                       2
                                                                  Page 18 of 35
<PAGE>



        (ii)  a  provision  permitting  the  recipient  of such Award to pay the
              purchase  price of the  Common  Stock or other  property  issuable
              pursuant to such Award, or to pay such recipient's tax withholding
              obligation with respect to such issuance,  in whole or in part, by
              delivering previously owned shares of capital stock of the Company
              (including  "pyramiding")  or other  property,  or by reducing the
              number of shares of Common  Stock or the amount of other  property
              otherwise issuable pursuant to such Award; or

       (iii)  a provision  conditioning or accelerating  the receipt of benefits
              pursuant  to  the  Award,   or  terminating   the  Award,   either
              automatically  or  in  the  discretion  of  the  Board,  upon  the
              occurrence of specified events,  including,  without limitation, a
              change of control of the Company,  an  acquisition  of a specified
              percentage of the voting power of the Company,  the dissolution or
              liquidation  of the Company,  a sale of  substantially  all of the
              property  and  assets  of the  Company  or an  event  of the  type
              described in Section 7 of the Plan.

    (f)  SUSPENSION OR  TERMINATION  OF AWARDS.  If the Company  believes that a
         Participant has committed an act of misconduct as described  below, the
         Company may suspend the Participant's rights under any then outstanding
         Award pending a  determination  by the Board.  If the Board  determines
         that  a  Participant  has  committed  an act  of  embezzlement,  fraud,
         nonpayment  of any  obligation  owed to the Company or any  subsidiary,
         breach of fiduciary duty or deliberate disregard of the Company's rules
         resulting in loss, damage or injury to the Company, or if a Participant
         makes an  unauthorized  disclosure  of  trade  secret  or  confidential
         information of the Company,  engages in any conduct constituting unfair
         competition,  or  induces  any  customer  of the  Company  to  breach a
         contract  with the  Company,  neither  the  Participant  nor his or her
         estate shall be entitled to exercise any rights whatsoever with respect
         to such Award. In making such determination, the Board shall act fairly
         and shall give the  Participant a reasonable  opportunity to appear and
         present evidence on his or her behalf to the Board.

    (g)  MAXIMUM  GRANT OF  AWARDS  TO ANY  PARTICIPANT.  No  Participant  shall
         receive  Awards  representing  more than 500,000 shares of Common Stock
         per annum, subject to adjustment as provided in Section 7 hereof.


5.  SHARES OF COMMON STOCK SUBJECT TO THE PLAN.

The  aggregate  number of shares of Common  Stock that may be issued or issuable
pursuant to all Awards under the Plan (including Awards in the form of Incentive
Stock Options and Non-Statutory  Stock Options) shall not exceed an aggregate of
4,800,000 shares of Common Stock, subject to adjustment as provided in Section 7
of the Plan.

Shares of Common Stock subject to the Plan may consist,  in whole or in part, of
authorized and unissued  shares or treasury  shares.  Any shares of Common Stock
subject to an Award which for any reason expires or is terminated unexercised as



                                       3
                                                                  Page 19 of 35
<PAGE>



to such  shares  shall  again be  available  for  issuance  under the Plan.  For
purposes of this Section 5, the aggregate  number of shares of Common Stock that
may be issued at any time  pursuant  to Awards  granted  under the Plan shall be
reduced by: (i) the number of shares of Common Stock previously  issued pursuant
to Awards granted under the Plan, other than shares of Common Stock subsequently
reacquired  by the Company  pursuant to the terms and  conditions of such Awards
and with respect to which the holder thereof  received no benefits of ownership,
such as  dividends;  and (ii) the  number of shares of Common  Stock  which were
otherwise  issuable  pursuant to Awards  granted  under this Plan but which were
withheld by the  Company as payment of the  purchase  price of the Common  Stock
issued  pursuant to such Awards or as payment of the recipient's tax withholding
obligation with respect to such issuance.


6.  PAYMENT OF AWARDS.

The Board shall  determine  the extent to which Awards shall be payable in cash,
shares of Common Stock or any combination  thereof.  The Board may, upon request
of a  Participant,  determine  that  all  or a  portion  of a  payment  to  that
Participant  under the Plan,  whether it is to be made in cash, shares of Common
Stock or a combination thereof,  shall be deferred.  Deferrals shall be for such
periods and upon such terms as the Board may determine in its sole discretion.


7.  DILUTION AND OTHER ADJUSTMENT.

In the event of any  change in the  outstanding  shares of the  Common  Stock or
other securities then subject to the Plan by reason of any stock split,  reverse
stock  split,   stock   dividend,   recapitalization,   merger,   consolidation,
combination or exchange of shares or other similar  corporate  change, or if the
outstanding  securities  of the class then subject to the Plan are exchanged for
or converted into cash, property or a different kind of securities,  or if cash,
property or securities are distributed in respect of such outstanding securities
as a class (other than cash dividends),  then the Board may, but it shall not be
required  to,  make  such  equitable  adjustments  to the  Plan  and the  Awards
thereunder  (including,   without  limitation,   appropriate  and  proportionate
adjustments in (i) the number and type of shares or other  securities or cash or
other  property  that may be acquired  pursuant to Incentive  Stock  Options and
other Awards  theretofore  granted under the Plan,  (ii) the maximum  number and
type of shares or other  securities  that may be issued  pursuant  to  Incentive
Stock Options and other Awards thereafter  granted under the Plan; and (iii) the
maximum  number of  securities  with respect to which Awards may  thereafter  be
granted  to any  Participant  in any  fiscal  year)  as the  Board  in its  sole
discretion  determines  appropriate,  including any  adjustments  in the maximum
number of shares referred to in Section 5 of the Plan. Such adjustments shall be
conclusive and binding for all purposes of the Plan.


8.  MISCELLANEOUS PROVISIONS.

    (a)  DEFINITIONS.  As used herein,  "subsidiary" means any current or future
         corporation which would be a "subsidiary  corporation," as that term is
         defined in Section  424(f) of the Code,  of the  Company;  and the term
         "or" means "and/or."


                                       4
                                                                  Page 20 of 35
<PAGE>



    (b)  CONDITIONS  ON  ISSUANCE.  Securities  shall not be issued  pursuant to
         Awards  unless the grant and  issuance  thereof  shall  comply with all
         relevant  provisions  of law and  the  requirements  of any  securities
         exchange or quotation  system upon which any  securities of the Company
         are listed, and shall be further subject to approval of counsel for the
         Company  with respect to such  compliance.  Inability of the Company to
         obtain  authority from any regulatory body having  jurisdiction,  which
         authority  is  determined  by Company  counsel to be  necessary  to the
         lawful  issuance and sale of any security or Award,  shall  relieve the
         Company of any liability in respect of the  nonissuance or sale of such
         securities  as  to  which  requisite  authority  shall  not  have  been
         obtained.

    (c)  RIGHTS AS  STOCKHOLDER.  A  participant  under the Plan  shall  have no
         rights as a holder of Common  Stock with  respect to Awards  hereunder,
         unless  and until  certificates  for shares of such stock are issued to
         the participant.

    (d)  ASSIGNMENT OR TRANSFER.  Subject to the  discretion  of the Board,  and
         except  with  respect  to  Incentive   Stock   Options  which  are  not
         transferable  except by will or the laws of descent  and  distribution,
         Awards  under the Plan or any  rights  or  interests  therein  shall be
         assignable or  transferable to the extent provided in the written grant
         agreement.

    (e)  AGREEMENTS.  All Awards  granted  under the Plan shall be  evidenced by
         written   agreements  in  such  form  and  containing  such  terms  and
         conditions  (not  inconsistent  with the Plan) as the Board  shall from
         time to time adopt.

    (f)  WITHHOLDING  TAXES. The Company shall have the right to deduct from all
         Awards  hereunder  paid in cash any  federal,  state,  local or foreign
         taxes  required by law to be withheld  with respect to such awards and,
         with respect to awards paid in stock,  to require the payment  (through
         withholding  from the  participant's  salary or  otherwise) of any such
         taxes. The obligation of the Company to make delivery of Awards in cash
         or Common Stock shall be subject to the restrictions imposed by any and
         all governmental authorities.

    (g)  NO RIGHTS TO AWARD. No Participant or other person shall have any right
         to be granted an Award under the Plan.  Neither the Plan nor any action
         taken  hereunder shall be construed as giving any Participant any right
         to be retained in the employ of the Company or any of its  subsidiaries
         or  shall  interfere  with or  restrict  in any way the  rights  of the
         Company  or any of its  subsidiaries,  which are  hereby  reserved,  to
         discharge a Participant at any time for any reason whatsoever,  with or
         without good cause.

    (h)  COSTS AND EXPENSES.  The costs and expenses of  administering  the Plan
         shall be borne by the  Company  and not charged to any Award nor to any
         Participant receiving an Award.

    (i)  FUNDING OF PLAN.  The Plan shall be unfunded.  The Company shall not be
         required to establish any special or separate fund or to make any other
         segregation  of assets to assure  the  payment  of any Award  under the
         Plan.

                                       5
                                                                  Page 21 of 35
<PAGE>


9.  AMENDMENTS AND TERMINATION.

    (a)  AMENDMENTS.  The Board may at any time  terminate  or from time to time
         amend the Plan in whole or in part, but no such action shall  adversely
         affect any rights or obligations with respect to any Awards theretofore
         made  under the Plan.  However,  with the  consent  of the  Participant
         affected,  the Board may amend outstanding agreements evidencing Awards
         under the Plan in a manner not inconsistent with the terms of the Plan.

    (b)  STOCKHOLDER APPROVAL. To the extent that Section 422 of the Code, other
         applicable  law,  or the  rules,  regulations,  procedures  or  listing
         agreement of any  national  securities  exchange or  quotation  system,
         requires that any amendment of the Plan be approved by the stockholders
         of the Company,  no such amendment shall be effective  unless and until
         it is  approved  by the  stockholders  in such a  manner  and to such a
         degree as is required.

    (c)  TERMINATION.  Unless the Plan shall theretofore have been terminated as
         above provided,  the Plan (but not the awards theretofore granted under
         the Plan)  shall  terminate  on and no awards  shall be  granted  after
         September 11, 2008.


10. EFFECTIVE DATE.

The Plan is  effective  on October 1, 1999,  the date on which it was adopted by
the Executive Committee of the Board of Directors of the Company.


11. FORM S-8 REGISTRATION STATEMENT.

The Company intends to file a Registration  Statement on Form S-8, or such other
form as counsel for the Company determines appropriate, to register the issuance
of shares by the Company  upon the exercise of any options  granted  pursuant to
the Plan. Prior to the filing and  effectiveness of the Registration  Statement,
any shares issued upon the exercise of options  granted  pursuant to the Plan to
U.S.  resident  shareholders  will be issued  pursuant  to  Section  4(2) of the
Securities  Act of 1933 and  will be  subject  to  appropriate  restrictions  on
transfer. Any shares issued upon the exercise of options granted pursuant to the
Plan to persons who are not U.S. Persons, as defined in Regulation S promulgated
pursuant  to the  Securities  Act of  1933,  shall  be  issued  in  reliance  of
Regulation  S and  subject to the  conditions  of  Regulation  S  including  the
agreement of the  Participants  not to resell the shares to a U.S. Person or for
the  account  or  benefit  of a U.S.  Person  until  expiry of the  distribution
compliance period.












                                       6
                                                                  Page 22 of 35
<PAGE>


12. GOVERNING LAW

The Plan and any  agreements  entered into  thereunder  shall be  construed  and
governed  by the laws of the State of  Delaware  applicable  to  contracts  made
within,  and to be performed  wholly within,  such state,  without regard to the
application of conflict of laws rules thereof.











































                                       7
                                                                  Page 23 of 35
<PAGE>
                                                                  EXHIBIT 99.2
                                                                  ------------

                       INCENTIVE STOCK OPTION AGREEMENT



      THIS INCENTIVE STOCK OPTION  AGREEMENT is made as of the Date of Grant set
forth below, between TURBODYNE  TECHNOLOGIES,  INC., a Delaware corporation (the
"Company"),  and the  employee  of the  Company  whose name  appears  below (the
"Optionee").  All capitalized  terms not specifically  defined herein shall have
the meanings set forth in the Company's 2000 Stock Incentive Plan (the "Plan").


                                   RECITALS

      A.    The  Board  of  Directors  and  the shareholders of the Company both
approved and adopted the Plan.  The Plan  provides for the granting of awards to
directors,  officers,  employees  and  consultants  of the Company or any of its
affiliates.

      B.    Pursuant  to  the  Plan,  the  Plan is administered by the Committee
appointed by and comprised of members of the Company's Board of Directors.

      C.    Pursuant to the Plan, the Compensation  Committee (the  "Committee")
has  determined  that it is to the  advantage  and in the best  interests of the
Company and its  shareholders to grant an incentive stock option to the Optionee
covering shares of the Company's  Common Stock (or any class of stock into which
such Common Stock is converted or reclassified as provided in the Plan) ("Common
Stock")  as an  inducement  to remain in the  service of the  Company  and as an
incentive  for  increased  effort  during such  service,  and has  approved  the
execution of this Incentive Stock Option  Agreement  between the Company and the
Optionee.

      D.    The  option  granted  hereby is intended to qualify as an "incentive
stock option" under Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code").

      NOW, THEREFORE, the parties hereto agree as follows:

            1. Grant of Option.  Effective  as of the date of grant set forth on
the  signature  page  hereof (the "Date of  Grant"),  the Company  grants to the
Optionee  the right and  option  (the  "Option")  to  purchase  on the terms and
conditions  hereinafter  set forth,  all or any part of such number of shares of
Common  Stock at such  purchase  price per share as are set forth  below,  which
price  is not less  than the fair  market  value of such  stock  (as  determined
pursuant to Section 4 hereof) on the Date of Grant;  provided,  however, that if
the Optionee  possesses more than ten percent (10%) of the total combined voting
power of all  classes  of  stock of the  Company  (and its  affiliates)  (a "10%
Shareholder"), such price is not less than one hundred and ten percent (110%) of
the fair market value of such stock (as determined pursuant to Section 4) on the
Date of Grant.  The Option shall be exercisable  from time to time in accordance
with the  provisions  of this  Agreement  during a period  expiring on the tenth
anniversary  of the  Date  of  Grant  (the  "Expiration  Date")  or  earlier  in


                                    -1-
                                                                  Page 24 of 35

<PAGE>



accordance with Section 5; provided, however, that it the Option is granted to a
10% Shareholder,  the Expiration Date shall be the fifth anniversary of the Date
of Grant.

            2. Vesting.  The Option shall become  exercisable  to purchase,  and
shall  vest with  respect  to,  such  percentage  of the shares  covered  hereby
(rounded to the nearest whole share) as may be set forth on the  signature  page
hereof.  In each  case the  number of shares  which  may be  purchased  shall be
calculated to the nearest full share.

            3. Manner of Exercise. Each exercise of the Option shall be by means
of a written notice of exercise delivered to the Company,  specifying the number
of shares to be purchased and  accompanied by payment to the Company of the full
purchased  price of the  shares to be  purchased  solely (i) in cash or by check
payable to the order of the Company,  (ii) by delivery of shares of Common Stock
of the Company already owned by, and in the possession of, the Optionee,  valued
at their fair market value, as determined in accordance with Section 4, or (iii)
(x) by a  promissory  note made by  Optionee in favor of the  Company,  upon the
terms and conditions  determined by the Committee  including,  to the extent the
Committee  determines  appropriate,  a security  interest in the shares issuable
upon exercise or other property, or (y) through a "cashless exercise," in either
case complying with applicable law  (including,  without  limitation,  state and
federal margin requirements), or any combination thereof. Shares of Common Stock
used to satisfy the exercise  price of this Option shall be valued at their fair
market value  determined  (in  accordance  with Section 4 hereof) on the date of
exercise (or if such date is not a business day, as of the close of the business
day immediately preceding date). This Option may not be exercised for a fraction
of a share and no partial  exercise  of this Option may be for less than (a) one
hundred  (100)  shares or (b) the  total  number of  shares  then  eligible  for
exercise, if less than one hundred (100) shares.

            The Option may be exercised  (i) during the lifetime of the Optionee
only by the  Optionee;  (ii) to the extent  permitted by the Committee or by the
terms of this  Agreement,  Optionee's  spouse if such spouse obtained the Option
pursuant to a  qualified  domestic  relations  ordered as defined by the Code of
Title  I of  ERISA,  or the  rules  thereunder  ("Qualified  Domestic  Relations
Order");  and (iii) after the Optionee's death by his or her transferees by will
or the laws of descent or distribution.

            4. Fair Market  Value of Common  Stock.  The fair market  value of a
share of Common  Stock shall be  determined  for  purposes of this  Agreement by
reference to the closing  price on the  principal  stock  exchange on which such
shares  are then  listed  or,  if such  shares  are not then  listed  on a stock
exchange,  by reference to the closing  price (if approved for  quotation on the
NASDAQ  National  Market System) or the mean between the bid and asked price (if
other  over-the-counter  issue)  of  a  share  as  supplied   by   the  National
Association  of Securities  Dealers,  Inc.  through  NASDAQ (or its successor in
function), in each case as reported by The Wall Street Journal, for the business
day immediately  preceding the date on which the option is granted  (which,  for
all purposes, shall be the Date of Grant) or exercised (or, if for any reason no
such  price  is  available,  in such  other  manner  as the  Committee  may deem
appropriate to reflect the then fair market value thereof).


                                    -2-
                                                                  Page 25 of 35

<PAGE>



            5. Termination of Employment;  Death or Permanent Disability. If the
Optionee  ceases to be employed by the Company or one of its  affiliates for any
reason other than the  Optionee's  death or "permanent  disability"  (within the
meaning of Section 22(e)(3) of the Code), the Option shall be exercisable  until
the earlier of (i) the Expiration Date or (ii) a date three (3) months after the
date the Optionee ceases to be an employee of the Company or such affiliate,  to
the extent  exercisable on the date of such  cessation of employment,  and shall
thereafter  expire  and be void and of no further  force or  effect.  A leave of
absence  approved in writing by the Committee  shall not be deemed a termination
of  employment  for the  purposes  of this  Section 5, but the Option may not be
exercised  during any such leave of absence,  except  during the first three (3)
months thereof. If the Optionee dies or becomes "permanently disabled" while the
Optionee is employed by the Company or one of its  affiliates,  the Option shall
expire on the  earlier  of (i) the  Expiration  Date or (ii) a date one (1) year
after  the  date  of  such  death  or  "permanent  disability,"  to  the  extent
exercisable on the date of death or permanent  disability,  and shall thereafter
expire and be void and of no further  force or effect.  During such period after
death,  the  Option  may,  to the  extent  that  it  remained  unexercised  (but
exercisable by the Optionee according to the Option's terms) on the date of such
death, be exercised by the person or persons to whom the Optionee's rights under
the Option  shall  pass by the  Optionee's  will or by the laws of  descent  and
distribution.

            6. Shares to be Issued in Compliance  with Federal  Securities  Laws
and Exchange Rules. By accepting the Option, the Optionee represents and agrees,
for the Optionee and his or her legal successors (by will or the laws of descent
and distribution or through a Qualified Domestic Relations Order),  that none of
the shares purchased upon exercise of the Option will be acquired with a view to
any sale, transfer or distribution of said shares in violation of the Securities
Act of 1933, as amended (the  "Securities  Act"),  and the rules and regulations
promulgated thereunder,  or any applicable state "blue sky" laws. If required by
the  Committee  at the time the Option is  exercised,  the Optionee or any other
person  entitled to exercise the Option shall furnish  evidence  satisfactory to
the Company  (including a written and signed  representation)  to such effect in
form and substance satisfactory to the Company,  including an indemnification of
the Company in the event of any  violation of the  Securities  Act or state blue
sky laws by such person.  The Company shall use  reasonable  efforts to take all
necessary  and  appropriate  action to assure that the shares  issuable upon the
exercise of this Option shall be issued in full  compliance  with the Securities
Act,  state  blue  sky  laws  and all  applicable  listing  requirements  of any
principal securities exchange on which shares of the same class are listed.

            7. Withholding of Taxes. Upon any disposition by the Optionee or the
Optionee's  legal  successor of shares of Common Stock acquired  pursuant to the
exercise  of this  Option  within  two (2) years of the Date of Grant or one (1)
year of the exercise of this Option (an "Early Disposition"),  the Company shall
have the right to require the Optionee or the Optionee's  legal successor to pay
the  Company  the  amount of any taxes  which the  Company  may be  required  to
withhold with respect to such shares.

            8. No Assignment. The  Option  and  all  other rights and privileges
granted  hereby are not  transferable  except by will or the laws of descent and
distribution or by Optionee's spouse if such spouse obtained the Option pursuant
to a qualified domestic relations.


                                    -3-
                                                                  Page 26 of 35

<PAGE>



            9.  Adjustment  for  Reorganizations,  Stock  Splits,  etc.  If  the
outstanding  shares of Common Stock of the Company (or any other class of shares
or securities  which shall have become issuable upon the exercise of this Option
pursuant to this sentence) are increased,  decreased,  changed into or exchanged
for a different  number or kind of shares or securities  of the Company  through
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse  stock  split  or  other  similar   transaction,   an  appropriate   and
proportionate  adjustment shall be made in the maximum number and kind of shares
receivable  upon the exercise of this Option,  without change in the total price
applicable to the unexercised  portion of this Option,  but with a corresponding
adjustment in the price for each share or other unit of any security  covered by
this Option.

            Upon  the  dissolution  or  liquidation  of the  Company,  or upon a
reorganization,  merger  or  consolidation  of the  Company  with  one  or  more
corporations as a result of which the Company is not the surviving  corporation,
or upon a sale of  substantially  all the  property or more than eighty  percent
(80%) of the then outstanding stock of the Company to another corporation,  this
Option shall terminate.
            Adjustments  under  this  Section 9 shall be made by the  Committee,
whose  determination  as to what  adjustments  shall  be  made,  and the  extent
thereof,  shall be final, binding and conclusive.  No fractional shares of stock
shall be issued under this Option on any such adjustment.

            10.  Participation  by the Optionee in Other Company Plans.  Nothing
herein  contained  shall affect the right of the Optionee to  participate in and
receive benefits under and in accordance with the then current provisions of any
pension,  insurance, profit sharing or other employee welfare plan or program of
the Company or of any subsidiary of the Company.

            11. No Rights as a Shareholder Until Issuance of Stock  Certificate.
Neither the  Optionee  nor any other person  legally  entitled to exercise  this
Option shall be entitled to any of the rights or privileges of a shareholder  of
the Company in respect of any shares  issuable  upon any  exercise of the Option
unless and until a certificate or  certificates  representing  such shares shall
have been  actually  issued and  delivered to the  Optionee.  No shares shall be
issued and  delivered  upon the  exercise of this Option  unless and until there
shall  have  been  full  compliance  with  all  applicable  requirements  of the
Securities  Act  (whether  by  registration  or  satisfaction  of  an  exemption
therefrom),  all  applicable  listing  requirements  of  a  national  securities
exchange on which shares of the same class are listed and any other requirements
of law or of any regulatory  bodies having  jurisdiction  over such issuance and
delivery.

            12. Not an Employment or Service Contract.  Nothing herein contained
shall be  construed  as an  agreement  by the Company or any of its  affiliates,
express or  implied,  to employ the  Optionee  or  contract  for the  Optionee's
services,  to restrict the Company's or such affiliate's  right to discharge the
Optionee or cease contracting for the Optionee's  services or to modify,  extend
or  otherwise  affect in any  manner  whatsoever,  the  terms of any  employment
agreement or contract for services  which may exist between the Optionee and the
Company or any of its affiliates.

            13. Agreement Subject to the Plan.  The  Option  hereby  granted  is
subject to, and the Company  and the  Optionee  agree to be bound by, all of the


                                    -4-
                                                                  Page 27 of 35

<PAGE>



terms and conditions of the Plan, as the same shall be amended from time to time
in accordance  with the terms  thereof,  but no such amendment  shall  adversely
affect the Optionee's rights under this Option without the prior written consent
of the Optionee.


            14. Execution.  The  interpretation,  performance and enforcement of
this Agreement shall be governed by the internal  substantive  laws of the State
of California.

                  COMPANY:                TURBODYNE TECHNOLOGIES INC.



                                          By_______________________________

                                          Its_______________________________

                  OPTIONEE:



                                          ---------------------------------
                                          Name





























                                    -5-
                                                                  Page 28 of 35

<PAGE>


      By his or her  signature  below,  the spouse of the Optionee  agrees to be
bound by all of the terms and conditions of the foregoing Agreement.

                  OPTIONEE'S SPOUSE:



                                          ---------------------------------
                                          Name

      The following  terms and  conditions are an integral part of the foregoing
Incentive Stock Option Agreement.


            Optionee:                      _________________________________

            Address:                       _________________________________
                                           _________________________________

            Social Security Number:        _________________________________


            Date of Grant:                 _________________________________

            Number of shares purchasable:  _________________________________

            Exercise Price per share:      _________________________________

            Expiration Date:               _________________________________




     Anniversary Date         Percentage Initially      Cumulative Percentage
   of the Date of Grant           Exercisable                Exercisable
--------------------------------------------------------------------------------
          First
--------------------------------------------------------------------------------
          Second
--------------------------------------------------------------------------------
          Third
--------------------------------------------------------------------------------
          Fourth
--------------------------------------------------------------------------------













                                    -6-
                                                                  Page 29 of 35

<PAGE>

                                                                  EXHIBIT 99.3
                                                                  ------------

                     NON-QUALIFIED STOCK OPTION AGREEMENT



      THIS NON-QUALIFIED  STOCK OPTION AGREEMENT is made as of the Date of Grant
set forth below,  between TURBODYNE  TECHNOLOGIES  INC., a Delaware  corporation
(the  "Company"),  and the employee of the Company whose name appears below (the
"Optionee").  All capitalized  terms not specifically  defined herein shall have
the meanings set forth in the Company's 2000 Stock Incentive Plan (the "Plan").


                                   RECITALS

      A.    The  Board  of  Directors  and  the shareholders of the Company both
approved and adopted the Plan.  The Plan  provides for the granting of awards to
directors,  officers,  employees  and  consultants  of the Company or any of its
affiliates.

      B.    Pursuant  to  the  Plan,  the  Plan is administered by the Committee
appointed by and comprised of members of the Company's Board of Directors.

      C.    Pursuant to the Plan, the Compensation  Committee (the  "Committee")
has  determined  that it is to the  advantage  and in the best  interests of the
Company  and its  shareholders  to grant an  non-qualified  stock  option to the
Optionee  covering  shares of the Company's  Common Stock (or any class of stock
into which such Common  Stock is converted  or  reclassified  as provided in the
Plan) ("Common  Stock") as an inducement to remain in the service of the Company
and as an incentive for increased  effort during such service,  and has approved
the execution of this  Non-Qualified  Stock Option Agreement between the Company
and the Optionee.

      D.    The  option  granted  hereby  is  not intended  to  qualify   as  an
"incentive stock option" under Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").

      NOW, THEREFORE, the parties hereto agree as follows:

            1. Grant of Option. The Company grants to the Optionee the right and
option (the  "Option") to purchase on the terms and conditions  hereinafter  set
forth, all or any part of such number of shares of Common Stock at such purchase
price per share as are set forth  below,  which  price is not less than the fair
market value of such stock (as  determined  pursuant to Section 4 hereof) on the
Date of Grant.  The Option shall be exercisable  from time to time in accordance
with the  provisions  of this  Agreement  during a period  expiring on the tenth
anniversary  of the  Date  of  Grant  (the  "Expiration  Date")  or  earlier  in
accordance with Section 5.

            2. Vesting.  The  Option  shall  become exercisable to purchase, and
shall  vest with  respect  to,  such  percentage  of the shares  covered  hereby



                                    -1-
                                                                  Page 30 of 35

<PAGE>


(rounded to the nearest whole share) as may be set forth on the  signature  page
hereof.  In each  case the  number of shares  which  may be  purchased  shall be
calculated to the nearest full share.

            3. Manner of Exercise. Each exercise of the Option shall be by means
of a written notice of exercise delivered to the Company,  specifying the number
of shares to be purchased and  accompanied by payment to the Company of the full
purchased  price of the  shares to be  purchased  solely (i) in cash or by check
payable to the order of the Company,  (ii) by delivery of shares of Common Stock
of the Company already owned by, and in the possession of, the Optionee,  valued
at their fair market value, as determined in accordance with Section 4, or (iii)
(x) by a  promissory  note made by  Optionee in favor of the  Company,  upon the
terms and conditions  determined by the Committee  including,  to the extent the
Committee  determines  appropriate,  a security  interest in the shares issuable
upon exercise or other property, or (y) through a "cashless exercise," in either
case complying with applicable law  (including,  without  limitation,  state and
federal margin requirements), or any combination thereof. Shares of Common Stock
used to satisfy the exercise  price of this Option shall be valued at their fair
market value  determined  (in  accordance  with Section 4 hereof) on the date of
exercise (or if such date is not a business day, as of the close of the business
day immediately preceding date). This Option may not be exercised for a fraction
of a share and no partial  exercise  of this Option may be for less than (a) one
hundred  (100)  shares or (b) the  total  number of  shares  then  eligible  for
exercise, if less than one hundred (100) shares.

            The Option may be exercised  (i) during the lifetime of the Optionee
only by the  Optionee;  (ii) to the extent  permitted by the Committee or by the
terms of this  Agreement,  Optionee's  spouse if such spouse obtained the Option
pursuant to a  qualified  domestic  relations  ordered as defined by the Code of
Title  I of  ERISA,  or the  rules  thereunder  ("Qualified  Domestic  Relations
Order");  and (iii) after the Optionee's death by his or her transferees by will
or the laws of descent or distribution.

            4. Fair Market  Value of Common  Stock.  The fair market  value of a
share of Common  Stock shall be  determined  for  purposes of this  Agreement by
reference to the closing  price on the  principal  stock  exchange on which such
shares  are then  listed  or,  if such  shares  are not then  listed  on a stock
exchange,  by reference to the closing  price (if approved for  quotation on the
NASDAQ  National  Market System) or the mean between the bid and asked price (if
other   over-the-counter  issue)  of  a  share  as  supplied   by  the  National
Association  of Securities  Dealers,  Inc.  through  NASDAQ (or its successor in
function), in each case as reported by The Wall Street Journal, for the business
day immediately  preceding the date on which the option is granted  (which,  for
all purposes, shall be the Date of Grant) or exercised (or, if for any reason no
such  price  is  available,  in such  other  manner  as the  Committee  may deem
appropriate to reflect the then fair market value thereof).

            5. Termination of Employment;  Death or Permanent Disability. If the
Optionee  ceases to be employed by the Company or one of its  affiliates for any
reason other than the  Optionee's  death or "permanent  disability"  (within the
meaning of Section 22(e)(3) of the Code), the Option shall be exercisable  until
the earlier of (i) the Expiration Date or (ii) a date three (3) months after the
date the Optionee ceases to be an employee of the Company or such affiliate,  to
the extent  exercisable on the date of such  cessation of employment,  and shall
thereafter  expire  and be void and of no further  force or  effect.  A leave of


                                    -2-
                                                                  Page 31 of 35

<PAGE>


absence  approved in writing by the Committee  shall not be deemed a termination
of  employment  for the  purposes  of this  Section 5, but the Option may not be
exercised  during any such leave of absence,  except  during the first three (3)
months thereof. If the Optionee dies or becomes "permanently disabled" while the
Optionee is employed by the Company or one of its  affiliates,  the Option shall
expire on the  earlier  of (i) the  Expiration  Date or (ii) a date one (1) year
after  the  date  of  such  death  or  "permanent  disability,"  to  the  extent
exercisable on the date of death or permanent  disability,  and shall thereafter
expire and be void and of no further  force or effect.  During such period after
death,  the  Option  may,  to the  extent  that  it  remained  unexercised  (but
exercisable by the Optionee according to the Option's terms) on the date of such
death, be exercised by the person or persons to whom the Optionee's rights under
the Option  shall  pass by the  Optionee's  will or by the laws of  descent  and
distribution.

            6. Shares to be Issued in Compliance  with Federal  Securities  Laws
and Exchange Rules. By accepting the Option, the Optionee represents and agrees,
for the Optionee and his or her legal successors (by will or the laws of descent
and distribution or through a Qualified Domestic Relations Order),  that none of
the shares purchased upon exercise of the Option will be acquired with a view to
any sale, transfer or distribution of said shares in violation of the Securities
Act of 1933, as amended (the  "Securities  Act"),  and the rules and regulations
promulgated thereunder,  or any applicable state "blue sky" laws. If required by
the  Committee  at the time the Option is  exercised,  the Optionee or any other
person  entitled to exercise the Option shall furnish  evidence  satisfactory to
the Company  (including a written and signed  representation)  to such effect in
form and substance satisfactory to the Company,  including an indemnification of
the Company in the event of any  violation of the  Securities  Act or state blue
sky laws by such person.  The Company shall use  reasonable  efforts to take all
necessary  and  appropriate  action to assure that the shares  issuable upon the
exercise of this Option shall be issued in full  compliance  with the Securities
Act,  state  blue  sky  laws  and all  applicable  listing  requirements  of any
principal securities exchange on which shares of the same class are listed.

            7. Withholding of Taxes. Upon any disposition by the Optionee or the
Optionee's  legal  successor of shares of Common Stock acquired  pursuant to the
exercise  of this  Option  within  two (2) years of the Date of Grant or one (1)
year of the exercise of this Option (an "Early Disposition"),  the Company shall
have the right to require the Optionee or the Optionee's  legal successor to pay
the  Company  the  amount of any taxes  which the  Company  may be  required  to
withhold with respect to such shares.

            8. No  Assignment.  Subject  to  the  discretion  of  the  Board  of
Directors,  awards  granted  hereby or any rights or interests  therein shall be
assignable or transferable to the extent provided herein.

            9.  Adjustment  for  Reorganizations,  Stock  Splits,  etc.   If the
outstanding  shares of Common Stock of the Company (or any other class of shares
or securities  which shall have become issuable upon the exercise of this Option
pursuant to this sentence) are increased,  decreased,  changed into or exchanged
for a different  number or kind of shares or securities  of the Company  through
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse  stock  split  or  other  similar   transaction,   an  appropriate   and
proportionate  adjustment shall be made in the maximum number and kind of shares


                                    -3-
                                                                  Page 32 of 35

<PAGE>


receivable  upon the exercise of this Option,  without change in the total price
applicable to the unexercised  portion of this Option,  but with a corresponding
adjustment in the price for each share or other unit of any security  covered by
this Option.

            Upon  the  dissolution  or  liquidation  of the  Company,  or upon a
reorganization,  merger  or  consolidation  of the  Company  with  one  or  more
corporations as a result of which the Company is not the surviving  corporation,
or upon a sale of  substantially  all the  property or more than eighty  percent
(80%) of the then outstanding stock of the Company to another corporation,  this
Option shall terminate.

            Adjustments  under  this  Section 9 shall be made by the  Committee,
whose  determination  as to what  adjustments  shall  be  made,  and the  extent
thereof,  shall be final, binding and conclusive.  No fractional shares of stock
shall be issued under this Option on any such adjustment.

            10. Participation  by  the Optionee in Other Company Plans.  Nothing
herein  contained  shall affect the right of the Optionee to  participate in and
receive benefits under and in accordance with the then current provisions of any
pension,  insurance, profit sharing or other employee welfare plan or program of
the Company or of any subsidiary of the Company.

            11. No Rights as a Shareholder Until Issuance of Stock  Certificate.
Neither the  Optionee  nor any other person  legally  entitled to exercise  this
Option shall be entitled to any of the rights or privileges of a shareholder  of
the Company in respect of any shares  issuable  upon any  exercise of the Option
unless and until a certificate or  certificates  representing  such shares shall
have been  actually  issued and  delivered to the  Optionee.  No shares shall be
issued and  delivered  upon the  exercise of this Option  unless and until there
shall  have  been  full  compliance  with  all  applicable  requirements  of the
Securities  Act  (whether  by  registration  or  satisfaction  of  an  exemption
therefrom),  all  applicable  listing  requirements  of  a  national  securities
exchange on which shares of the same class are listed and any other requirements
of law or of any regulatory  bodies having  jurisdiction  over such issuance and
delivery.

            12. Not an Employment or Service Contract.  Nothing herein contained
shall be  construed  as an  agreement  by the Company or any of its  affiliates,
express or  implied,  to employ the  Optionee  or  contract  for the  Optionee's
services,  to restrict the Company's or such affiliate's  right to discharge the
Optionee or cease contracting for the Optionee's  services or to modify,  extend
or  otherwise  affect in any  manner  whatsoever,  the  terms of any  employment
agreement or contract for services  which may exist between the Optionee and the
Company or any of its affiliates.

            13.  Agreement  Subject to the Plan.  The Option  hereby  granted is
subject to, and the Company  and the  Optionee  agree to be bound by, all of the
terms and conditions of the Plan, as the same shall be amended from time to time
in accordance  with the terms  thereof,  but no such amendment  shall  adversely
affect the Optionee's rights under this Option without the prior written consent
of the Optionee.


                                    -4-
                                                                  Page 33 of 35

<PAGE>



            14. Execution.  The  interpretation,  performance and enforcement of
this Agreement shall be governed by the internal  substantive  laws of the State
of California.


                  COMPANY:                TURBODYNE TECHNOLOGIES INC.



                                          By_______________________________

                                          Its_______________________________

                  OPTIONEE:



                                          ---------------------------------
                                          Name





































                                    -5-
                                                                  Page 34 of 35

<PAGE>


      By his or her  signature  below,  the spouse of the Optionee  agrees to be
bound by all of the terms and conditions of the foregoing Agreement.

                  OPTIONEE'S SPOUSE:



                                          ---------------------------------
                                          Name

      The following  terms and  conditions are an integral part of the foregoing
Incentive Stock Option Agreement.


            Optionee:                      _________________________________

            Address:                       _________________________________
                                           _________________________________

            Social Security Number:        _________________________________


            Date of Grant:                 _________________________________

            Number of shares purchasable:  _________________________________

            Exercise Price per share:      _________________________________

            Expiration Date:               _________________________________




     Anniversary Date         Percentage Initially      Cumulative Percentage
   of the Date of Grant           Exercisable                Exercisable
--------------------------------------------------------------------------------
          First
--------------------------------------------------------------------------------
          Second
--------------------------------------------------------------------------------
          Third
--------------------------------------------------------------------------------
          Fourth
--------------------------------------------------------------------------------













                                    -6-
                                                                  Page 35 of 35
[{"type": "S-8", "sequence": "1", "filename": "turbos-8.txt", "description": "REGISTRATION STATEMENT", "secsgml_size_bytes": 96367}]
{"company-data": {"conformed-name": "TURBODYNE TECHNOLGIES INC", "cik": "0001022097", "assigned-sic": "3714", "irs-number": "954699061", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-43852", "film-number": "703573"}, "business-address": {"street1": "21700 OXNARD STREET", "street2": "SUITE 1550", "city": "WOODLAND HILLS", "state": "CA", "zip": "91367", "phone": "8185932282"}, "mail-address": {"street1": "21700 OXNARD STREET", "street2": "SUITE 1550", "city": "WOODLAND HILLS", "state": "CA", "zip": "91367"}}
As filed with the Securities and Exchange Commission on August 15, 2000
                                            Registration No. 333-
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    ---------

                                    FORM S-8
             REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
                                   ----------

                           TURBODYNE TECHNOLOGIES INC.
             (Exact name of registrant as specified in its charter)

                  Delaware                           95-4699061
         (State or other jurisdiction             (I.R.S. Employer
      of incorporation or organization)          Identification No.)

           6155 Carpinteria Avenue                     93013
           Carpinteria, California                   (Zip code)
   (Address of principal executive offices)

                                  --------
                         2000 STOCK INCENTIVE PLAN
                          (Full title of the plan)
                                 ----------

                             Joseph D. Castano
                          Chief Financial Officer
                        Turbodyne Technologies Inc.
                          6155 Carpinteria Avenue
                       Carpinteria, California 93013
                  (Name and address of agent for service)

                               (805) 684-4551
       (Telephone number, including area code, of agent for service)

                                  Copy to:

                           PETER M. MENARD, ESQ.
                  Sheppard, Mullin, Richter & Hampton LLP
                     333 South Hope Street, 48th Floor
                       Los Angeles, California 90071
                               (213) 617-5483

                      CALCULATION OF REGISTRATION FEE
================================================================================
                                      Proposed        Proposed
                       Amount          maximum         maximum        Amount of
Title of securities    to be       offering price     aggregate     registration
 to be registered   registered (1)   per share (2)  offering price       fee
--------------------------------------------------------------------------------
Common Stock, $.001   4,800,000         $.75         $3,600,000       $1,062.00
   par value
================================================================================

(1)   This Registration Statement covers, in addition to the number of shares of
      Common Stock stated above, such  indeterminate  number of shares of Common
      Stock as may be issued  upon  exercise of options  granted  under the 2000
      Stock Incentive Plan as a result of the adjustment provisions thereof.

(2)   Estimated   solely  for  purposes  of   calculating   the  amount  of  the
      registration  fee  pursuant  to Rule 457 based upon the last sale price of
      the Common Stock as reported by CNBC on the pink sheets on August 8, 2000.
================================================================================

         This Registration Statement Includes a Total of 35 Pages.
                     Exhibit Index Appears on Page 12
                                                                   Page 1 of 35
PART I

            INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

            The document(s)  containing the  information  specified in Part I of
Form of S-8 will be sent or given to  participants  in the 2000 Stock  Incentive
Plan (the "Plan") of Turbodyne  Technologies  Inc., a Delaware  corporation (the
"Registrant"),  as specified in Rule 428(b)(1) promulgated by the Securities and
Exchange  Commission  (the  "Commission")  under the  Securities Act of 1933, as
amended (the  "Securities  Act").  Such document(s) are not being filed with the
Commission either as part of this  Registration  Statement or as prospectuses or
prospectus  supplements pursuant to Rule 424 in accordance with the Note to Part
I of Form S-8. These documents and the documents  incorporated by reference into
this  Registration  Statement  pursuant to Item 3 of Part II of Form S-8,  taken
together,  constitute a prospectus that meets the  requirements of Section 10(a)
of the Securities Act.

                                     I-1
                                                                   Page 2 of 35
PART II

             INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.  Incorporation of Documents by Reference.
         ---------------------------------------

            The following documents  previously filed by the Registrant with the
Commission are incorporated in this Registration Statement by reference:

            (a)  The Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1999;

            (b)  All other reports filed by the Registrant  pursuant to Sections
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), since the end of the fiscal year ended December 31, 1999; and

            (c)  The description of the Common Stock of the Registrant contained
in the  Registrant's  Registration  Statement on Form S-1  (Commission  File No.
333-65207),  including any amendment or report filed for the purpose of updating
such description.

            All documents  filed by the  Registrant  pursuant to Section  13(a),
13(c),  14 or  15(d)  of the  Exchange  Act  subsequent  to  the  date  of  this
Registration  Statement  and prior to the filing of a  post-effective  amendment
which  indicates  that all  securities  offered  hereby  have been sold or which
deregisters  all  securities  then  remaining  unsold,  shall  be  deemed  to be
incorporated  by reference  into this  Registration  Statement  and to be a part
hereof from the date of filing of such documents.

            Any  statement  made in a  document  incorporated  or  deemed  to be
incorporated  by reference  herein shall be deemed to be modified or  superseded
for  purposes  of this  Registration  Statement  to the extent  that a statement
contained  herein  or in any other  subsequently  filed  document  which is also
incorporated  or deemed to be  incorporated  by  reference  herein  modifies  or
supersedes  such statement.  Any such statement so modified or superseded  shall
not be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.

Item 4.  Description of Securities.
         -------------------------

            Not applicable.

Item 5.  Interests of Named Experts and Counsel.
         --------------------------------------

            Not applicable.

Item 6.  Indemnification of Directors and Officers.
         -----------------------------------------

            Section 145 of the Delaware  General  Corporation Law (the "Delaware
Law") grants corporations the power to indemnify directors,  officers, employees
and agents in accordance with the provisions thereof.

                                   II-1
                                                                   Page 3 of 35
Section 102(b)(7) of the Delaware Law grants  corporations the power
to eliminate a director's personal liability for monetary damages to the Company
or its  stockholders  for  breach of  fiduciary  duty as a  director,  except in
circumstances  involving a breach of a director's duty of loyalty to the Company
of its  stockholders,  acts or  omissions  not in good  faith or  which  involve
intentional  misconduct or knowing  violations of the law,  self-dealing  or the
unlawful payment of dividends or repurchase of stock.

            Article X of the Registrant's Certificate of Incorporation provides:

            The Corporation  shall indemnify to the fullest extent authorized or
permitted by law (as now or hereafter in effect) any person made,  or threatened
to be made, a defendant or witness to any action,  suit or  proceeding  (whether
civil or criminal or otherwise) by reason of the fact that she or he, her or his
testator or intestate, is or was a director,  officer,  employee or agent of the
Corporation  or by reason of the fact that any  person is or was  serving at the
request of the Corporation as a director,  officer, employee or agent of another
corporation,  partnership,  joint  venture,  trust,  employee  benefit  plan  or
enterprise.  Nothing contained herein shall affect any rights to indemnification
to which  employees other than directors and officers may be entitled by law. No
amendment  or repeal of this  paragraph  of Article X shall apply to or have any
effect on any right to  indemnification  provided  hereunder with respect to any
acts or omissions occurring prior to such amendment or repeal.

            No director of the  Corporation  shall be  personally  liable to the
Corporation or its stockholders for monetary damages for any breach of fiduciary
duty by such a director as a director. Notwithstanding the foregoing sentence, a
director  shall be liable to the extent  provided by applicable  law (i) for any
breach of the director's duty of loyalty to the Corporation or its stockholders,
(ii) for acts or  omissions  not in good  faith  or  which  involve  intentional
misconduct or a knowing  violation of law,  (iii) pursuant to Section 174 of the
Delaware Law, or (iv) for any  transaction  form which such director  derived an
improper  personal  benefit.  No  amendment  to or repeal of this  paragraph  of
Article  X shall  apply  to or have  any  effect  on the  liability  or  alleged
liability of any director of the  Corporation for or with respect to any acts or
omissions of such director occurring prior to such amendment or repeal.

            In  furtherance  and not in  limitation  of the powers  conferred by
statute:

                        (i)  the Corporation may purchase and maintain insurance
on behalf of any person who is or was a director or  officer,  employee or agent
of the  Corporation,  or is  serving  at the  request  of the  Corporation  as a
director, officer, employee or agent of another corporation,  partnership, joint
venture,  trust, employee benefit plan or other enterprise against any liability
asserted against him or her and incurred by him or her in any such capacity,  or
arising out of his or her status as such,  whether or not the Corporation  would
have the power to indemnify  against such liability under the provisions of law;
and

                                   II-2
                                                                   Page 4 of 35
(ii)  the Corporation may  create a  trust fund,  grant a
security interest and/or use other means (including, without limitation, letters
of credit,  surety bonds and/or other  similar  arrangements),  as well as enter
into  contract  providing  indemnification  to the  full  extent  authorized  or
permitted by law and including as part thereof provisions with respect to any or
all of the  foregoing  to ensure  the  payment  of such  amounts  as may  become
necessary to effect indemnification as provided therein, or elsewhere.

            Article XI, Section 43 of the Registrant's Bylaws provides:

            Section 43.  INDEMNIFICATION OF DIRECTORS, EXECUTIVE OFFICERS, OTHER
OFFICERS, EMPLOYEES AND OTHER AGENTS.

            (a)  DIRECTORS   OFFICERS.   The  corporation  shall  indemnify  its
directors  and  officers to the fullest  extent not  prohibited  by the Delaware
General Corporation Law; provided,  however, that the corporation may modify the
extent of such  indemnification  by individual  contracts with its directors and
officers; and, provided,  further, that the corporation shall not be required to
indemnify any director or officer in  connection  with any  proceeding  (or part
thereof)  initiated by such person unless (i) such  indemnification is expressly
required to be made by law, (ii) the  proceeding  was authorized by the Board of
Directors  of the  corporation,  (iii) such  indemnification  is provided by the
corporation,  in its sole  discretion,  pursuant  to the  powers  vested  in the
corporation   under  the  Delaware   General   Corporation   Law  or  (iv)  such
indemnification is required to be made under subsection (d).

            (b)  EMPLOYEES AND OTHER AGENTS.  The  corporation  shall have power
to indemnify its employees and other agents as set forth in the Delaware General
Corporation Law.

            (c)  EXPENSE. The corporation shall advance to any person who was or
is a party or is  threatened  to be made a party to any  threatened,  pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he is or was a director or officer, of
the  corporation,  or is or was serving at the request of the  corporation  as a
director  or  executive  officer  of  another  corporation,  partnership,  joint
venture,  trust  or other  enterprise,  prior to the  final  disposition  of the
proceeding,  promptly  following request therefor,  all expenses incurred by any
director  or officer  in  connection  with such  proceeding  upon  receipt of an
undertaking  by or on behalf of such person to repay said mounts if it should be
determined  ultimately that such person is not entitled to be indemnified  under
this Bylaw or otherwise.

            Notwithstanding the foregoing,  unless otherwise determined pursuant
to paragraph (e) of this Bylaw,  no advance shall be made by the  corporation to
an officer of the corporation (except by reason of the fact that such officer is
or was a director of the  corporation  in which event this  paragraph  shall not
apply)  in  any  action,   suit  or   proceeding,   whether   civil,   criminal,
administrative or  investigative,  if a determination is reasonably and promptly
made (i) by the Board of Directors by a majority vote of a quorum  consisting of
directors who were not parties to the proceeding,  or (ii) if such quorum is not
obtainable,  or, even if  obtainable,  a quorum of  disinterested  directors  so
directs, by independent legal counsel in a written opinion, that the facts known
to the decision-making  party at the time such determination is made demonstrate

                                   II-3
                                                                   Page 5 of 35
clearly and convincingly that such person acted in bad faith or in a manner that
such person did not believe to be in or not opposed to the best interests of the
corporation.

            (d)  ENFORCEMENT.  Without the necessity of entering into an express
contract,  all rights to indemnification  and advances to directors and officers
under this Bylaw shall be deemed to be  contractual  rights and be  effective to
the same extent and as if provided for in a contract between the corporation and
the director or officer.  Any right to  indemnification  or advances  granted by
this Bylaw to a director or officer shall be  enforceable by or on behalf of the
person  holding  such right in any court of  competent  jurisdiction  if (i) the
claim for indemnification or advances is denied, in whole or in part, or (ii) no
disposition  of such claim is made within ninety (90) days of request  therefor.
The claimant in such  enforcement  action,  if  successful  in whole or in part,
shall be  entitled  to be paid also the  expense of  prosecuting  his claim.  In
connection with any claim for indemnification, the corporation shall be entitled
to raise as a  defense  to any such  action  that the  claimant  has not met the
standard  of  conduct  that  make it  permissible  under  the  Delaware  General
Corporation  Law for the  corporation  to indemnify  the claimant for the amount
claimed.  In connection with any claim by an officer of the corporation  (except
in any action, suit or proceeding,  whether civil,  criminal,  administrative or
investigative,  by reason of the fact that such  officer is or was a director of
the  corporation)  for advances,  the  corporation  shall be entitled to raise a
defense as to any such action  clear and  convincing  evidence  that such person
acted in bad faith or in a manner  that such  person did not believe to be in or
not opposed in the best  interests  of the  corporation,  or with respect to any
criminal action or proceeding that such person acted without reasonable cause to
believe  that his  conduct was  lawful.  Neither the failure of the  corporation
(including   its  Board  of   Directors,   independent   legal  counsel  or  its
stockholders)  to have made a  determination  prior to the  commencement of such
action  that  indemnification  of the  claimant  is proper in the  circumstances
because he has met the applicable  standard of conduct set forth in the Delaware
General  Corporation  Law,  nor  an  actual  determination  by  the  corporation
(including   its  Board  of   Directors,   independent   legal  counsel  or  its
stockholders) that the claimant has not met such applicable standard of conduct,
shall be a defense to the action or create a  presumption  that claimant has not
met the  applicable  standard of conduct.  In any suit  brought by a director or
officer to enforce a right to  indemnification  or to an advancement of expenses
hereunder, the burden of proving that the director or officer is not entitled to
be  indemnified,  or to such  advancement of expenses,  under this Article XI or
otherwise shall be on the corporation.

            (e)  NON-EXCLUSIVITY OF RIGHTS.  The  rights conferred on any person
by this Bylaw  shall not be  exclusive  of any other right which such person may
have or hereafter  acquire under any statute,  provision of the  Certificate  of
Incorporation,   Bylaws,   agreement,  vote  of  stockholders  or  disinterested
directors or  otherwise,  both as to action in his  official  capacity and as to
action in another capacity while holding office. The corporation is specifically
authorized to enter into individual  contracts with any or all of its directors,
officers,  employees or agents respecting  indemnification and advances,  to the
fullest extent not prohibited by the Delaware General Corporation Law.

                                   II-4
                                                                   Page 6 of 35
(f)  SURVIVAL OF RIGHTS.  The rights conferred on any person by this
Bylaw shall  continue  as to a person who has ceased to be a director,  officer,
employee or other  agent and shall inure to the benefit of the heirs,  executors
and administrators of such a person.

            (g)  INSURANCE.  To the fullest  extent  permitted  by the  Delaware
General  Corporation  Law,  the  corporation,  upon  approval  by the  Board  of
Directors,  may purchase insurance on behalf of any person required or permitted
to be indemnified pursuant to this Bylaw.

            (h)  AMENDMENTS. Any repeal or modification of this Bylaw shall only
be prospective and shall not affect the rights under this Bylaw in effect at the
time of the  alleged  occurrence  of any action or  omission  to act that is the
cause of any proceeding against any agent of the corporation.

            (i)  SAVING  CLAUSE. If this Bylaw or any  portion  hereof  shall be
invalidated  on any  ground by any  court of  competent  jurisdiction,  then the
corporation shall  nevertheless  indemnify each director and officer to the full
extent not  prohibited  by any  applicable  portion of this Bylaw that shall not
have been invalidated, or by any other applicable law.

            (j)  CERTAIN DEFINITIONS.   For  the  purposes  of  this  Bylaw, the
following definitions shall apply:

                        (i)  The  term  "proceeding"  shall be broadly construed
and  shall  include,   without  limitation,   the  investigation,   preparation,
prosecution,  defense, settlement,  arbitration and appeal of, and the giving of
testimony in, any threatened,  pending or completed action,  suit or proceeding,
whether civil, criminal, administrative or investigative.

                       (ii)  The term "expenses" shall be broadly construed and
shall include,  without limitation,  court costs, attorneys' fees, witness fees,
fines,  amounts paid in  settlement or judgment and any other costs and expenses
of any nature or kind incurred in connection with any proceeding.

                      (iii)  The  term  the   "corporation"  shall  include,  in
addition to the resulting  corporation,  any constituent  corporation (including
any constituent of a constituent)  absorbed in a consolidation  or merger which,
if its separate  existence had continued,  would have had power and authority to
indemnify its directors,  officers,  and employees or agents, so that any person
who is or was a  director,  officer,  employee  or  agent  of  such  constituent
corporation, or is or was serving at the request of such constituent corporation
as a director,  officer, employee or agent or another corporation,  partnership,
joint venture, trust or other enterprise, shall stand in the same position under
the  provisions  of this  Bylaw  with  respect  to the  resulting  or  surviving
corporation as he would have with respect to such constituent corporation if its
separate existence had continued.

                       (iv)  Reference  to  a  "director,"  "executive officer,"
"officer,"  "employee," or "agent" of the  corporation  shall  include,  without
limitation,  situations  where  such  person is  serving  at the  request of the
corporation as, respectively,  a director, executive officer, officer, employee,
trustee or agent of another corporation,  partnership,  joint venture,  trust or
other enterprise.

                                      II-5
                                                                   Page 7 of 35
(v)  References  to  "other enterprises"  shall  include
employee  benefit  plans;  references  to "fines" shall include any excise taxes
assessed on a person with respect to an employee benefit plan; and references to
"serving  at the  request of the  corporation"  shall  include  any service as a
director, officer, employee or agent of the corporation which imposes duties on,
or involves services by, such director, officer, employee, or agent with respect
to an employee benefit plan, its participants,  or  beneficiaries;  and a person
who  acted in good  faith and in a manner he  reasonably  believed  to be in the
interest of the participants and beneficiaries of an employee benefit plan shall
be deemed to have acted in a manner "not  opposed to the best  interests  of the
corporation" as referred to in this Bylaw.

Item 7.  Exemption from Registration Claimed.
         -----------------------------------

            Not applicable.

Item 8.  Exhibits.
         --------

    Exhibit
    Number  Description
    ------  -----------

      3.1   Certificate of Incorporation of the Registrant(1)
      3.2   Bylaws of the Registrant(1)
      5.1   Opinion of Sheppard, Mullin, Richter & Hampton LLP
     23.1   Consent of Sheppard, Mullin, Richter & Hampton LLP (see Exhibit 5.1)
     23.2   Consent of Independent Auditors (McGowan Guntermann)
     24.1   Power of Attorney (See page II-7)
     99.1   2000 Stock Incentive Plan
     99.2   Form of Incentive Stock Option Agreement
     99.3   Form of Non-Qualified Stock Option Agreement

Item 9.  Undertakings.
         ------------

            (a)  The undersigned Registrant hereby undertakes:

                 (1)  To file,  during any  period in which  offers or sales are
being made, a post-effective amendment to this Registration Statement:

                        (i)  To  include  any  prospectus  required  by  Section
10(a)(3) of the Securities Act of 1933;

                       (ii)  To  reflect  in  the prospectus any facts or events
arising after the  effective  date of this  Registration  Statement (or the most
recent post-effective amendment hereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this Registration
Statement; and

--------

(1)    Filed as an exhibit to the  Registrant's  Form 10-Q for the quarter ended
       June 30, 1998 filed with the Securities and Exchange Commission.

                                      II-6
                                                                   Page 8 of 35
(iii)  To include any material information with respect to
the plan of distribution not previously disclosed in this Registration Statement
or any material change to such information in this Registration Statement;

            Provided,  however,  that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information  required to be included in a post-effective  amendment
by those  paragraphs is contained in periodic reports filed with or furnished to
the Commission by the Registrant  pursuant to Section 13 or Section 15(d) of the
Securities  Exchange  Act of 1934 that are  incorporated  by  reference  in this
Registration Statement.

                 (2)  That for the purpose of  determining  any liability  under
the Securities Act of 1933, each such  post-effective  amendment shall be deemed
to be a new registration  statement  relating to the securities offered therein,
and the  offering  of such  securities  at that  time  shall be deemed to be the
initial bona fide offering thereof.

                 (3)  To remove from  registration by means of a  post-effective
amendment  any of the  securities  being  registered  which remain unsold at the
termination of the offering.

            (b)  The undersigned Registrant hereby undertakes that, for purposes
of determining  any liability  under the Securities Act of 1933,  each filing of
the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities  Exchange  Act of 1934  that is  incorporated  by  reference  in this
Registration  Statement  shall  be  deemed  to be a new  registration  statement
relating to the securities  offered herein,  and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

            (c)  Insofar as indemnification  for  liabilities  arising under the
Securities  Act of 1933 may be permitted to directors,  officers or  controlling
persons of the Registrant  pursuant to the foregoing  provisions,  or otherwise,
the  Registrant  has been  advised  that in the  opinion of the  Securities  and
Exchange  Commission such  indemnification is against public policy as expressed
in the Securities  Act of 1933 and is,  therefore,  unenforceable.  In the event
that a claim  for  indemnification  against  such  liabilities  (other  than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling  person of the Registrant in the  successful  defense of any action,
suit or proceeding) is asserted by such director,  officer or controlling person
in connection with the securities being registered,  the Registrant will, unless
in the  opinion  of its  counsel  the matter  has been  settled  by  controlling
precedent,  submit to a court of appropriate  jurisdiction  the question whether
such  indemnification  by it is  against  public  policy  as  expressed  in  the
Securities  Act of 1933 and will be governed by the final  adjudication  of such
issue.

                                   II-7
                                                                   Page 9 of 35
SIGNATURES

            Pursuant to the  requirements  of the  Securities  Act of 1933,  the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized,  in the  City of Carpinteria,  State of California, on this 31st day
of July, 2000.

                                     TURBODYNE TECHNOLOGIES INC.

                                     By   /s/ Joseph D. Castano
                                          _____________________________________
                                           Joseph D. Castano,
                                           Chief Financial Officer and Secretary

            KNOW ALL MEN BY THESE  PRESENTS,  that each person  whose  signature
appears  below  constitutes  and appoints  each of Gerhard E. Delf and Joseph D.
Castano his true and lawful  attorney-in-fact and agent, each with full power of
substitution,  for  him  and in his  name,  place  and  stead,  in any  and  all
capacities, to sign any or all amendments to this Registration Statement, and to
file the same with all exhibits  thereto,  and all other documents in connection
therewith, with the Securities and Exchange Commission,  granting unto each said
attorney-in-fact  and agent with full power and authority to do and perform each
and every  act and thing  requisite  and  necessary  to be done in and about the
premises,  as  fully  to all  intents  and  purposes  as he might or could do in
person,  hereby ratifying and confirming all that each said attorney-in-fact and
agent, or his substitute, may lawfully do or cause to be done by virtue hereof.

            Pursuant  to the  requirements  of the  Securities  Act of 1933,  as
amended, this Registration Statement has been signed by the following persons in
the capacities and on the dates indicated.
Signature                           Title                                      Date
         ---------                           -----                                      ----
/s/ Gerhard E. Delf
_____________________________      President and Chief Executive Officer            July 31, 2000
      Gerhard E. Delf

/s/ Peter Hofbauer
_____________________________      Chairman of the Board                            July 31, 2000
   Prof. Peter Hofbauer

/s/ Robert Taylor
_____________________________      Director                                         July 31, 2000
       Robert Taylor

/s/ Joseph D. Castano
_____________________________      Chief Financial Officer (Principal Financial     July 31, 2000
     Joseph D. Castano             and Accounting Officer) and Secretary

/s/ Sadayappa Durairaj
_____________________________      Director                                         July 31, 2000
  Dr. Sadayappa Durairaj

/s/ Wendall R. Anderson
_____________________________      Director                                         July 31, 2000
    Wendall R. Anderson

/s/ Peter Kitzinski
_____________________________      Director                                         July 31, 2000
      Peter Kitzinski

/s/ Daniel Geronazzo
_____________________________      Director                                         July 31, 2000
     Daniel Geronazzo

/s/ Friedrich Goes
_____________________________      Director                                         July 31, 2000
    Dr. Friedrich Goes
Page 10 of 35
EXHIBITS
                                      TO
                                   FORM S-8

            REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

                                ---------------

                          TURBODYNE TECHNOLOGIES INC.

                                                                  Page 11 of 35
EXHIBIT INDEX

Exhibit                                                         Sequential
Number      Description                                         Page Number
------      -----------                                         -----------

  3.1       Certificate of Incorporation of the Registrant(1)
  3.2       Bylaws of the Registrant(1)
  5.1       Opinion of Sheppard, Mullin, Richter & Hampton LLP      13
 23.1       Consent of Sheppard, Mullin, Richter & Hampton LLP
               (see Exhibit 5.1)
 23.2       Consent of Independent Auditors (McGowan Guntermann)    16
 24.1       Power of Attorney (See page II-7)
 99.1       2000 Stock Incentive Plan                               17
 99.2       Form of Incentive Stock Option Agreement                24
 99.3       Form of Non-Qualified Stock Option Agreement            30

--------

(1)    Filed as an exhibit to the  Registrant's  Form 10-Q for the quarter ended
       June 30, 1998 filed with the Securities and Exchange Commission.

                                                                  Page 12 of 35
EXHIBIT 5.1
                                                                    -----------

                            August 14, 2000

Turbodyne Technologies Inc.
6155 Carpinteria Avenue
Carpinteria, California 93013

Re:   Registration Statement on Form S-8
      ----------------------------------

Gentlemen:

            At your request, we have examined the Registration Statement on Form
S-8 (the "Registration Statement") to be filed by Turbodyne Technologies Inc., a
Delaware   corporation  (the  "Company"),   with  the  Securities  and  Exchange
Commission (the "SEC") in connection with the registration  under the Securities
Act of 1933,  as amended (the  "Securities  Act"),  of  4,800,000  shares of the
Company's common stock (the "Common Stock"), that may be issued in the aggregate
pursuant to awards  granted under the Company's  2000 Stock  Incentive Plan (the
"Plan").

            In rendering  this  opinion,  we have  examined  only the  following
documents:

            1.   The  Certificate of Incorporation of the Company, as  certified
                 by the Delaware Secretary of State;

            2.   The Bylaws of the Company;

            3.   The Plan;

            4.   The forms of Incentive Stock Option Agreement and Non-Qualified
                 Stock Option Agreement  (collectively  the  "Agreements") to be
                 used in connection with the Plan;

                                                                  Page 13 of 35
Turbodyne Technologies Inc.
August 14, 2000
Page 2

            5.   Resolutions, adopted by the Company's Board of Directors as of
                 July 31, 2000, and by the stockholders of the Company as of May
                 12,  2000,   pertaining  to  the  adoption  of  the  Plan,  the
                 Agreements and the Registration Statement; and

            6.   The Registration Statement.

            With  respect  to the  foregoing  documents,  we  have  assumed  the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals and the conformity to originals of all documents submitted to us as
certified or reproduced  copies.  We also have obtained from the officers of the
Company certificates as to all factual matters necessary for the purpose of this
opinion and,  insofar as this opinion is based on such matters of fact,  we have
relied on such certificates without independent investigation.

            Based  solely  upon the  foregoing  and  assuming,  without  further
inquiry,  that (i) all awards  granted under the Plan to date have been, and all
awards to be  granted  under  the Plan  will be,  duly and  validly  granted  in
accordance with the terms of the Plan, (ii) the  consideration for the shares of
Common Stock to be issued  pursuant to such awards will be received prior to the
issuance thereof, (iii) the shares of Common Stock to be issued pursuant to such
awards  will be  issued  in  accordance  with  the  terms  of the  Plan  and the
applicable  Agreement,  (iv) the  Registration  Statement will become  effective
under the  Securities  Act prior to the  issuance of any shares of Common  Stock
under  the  Plan  and  no  stop  order  suspending  the   effectiveness  of  the
Registration  Statement  shall  have been  issued  and no  proceedings  for that
purpose  shall  have  been   instituted  or  be  pending  before  the  SEC,  (v)
prospectuses  will be  updated  and  delivered  to  participants  in the Plan as
required by the Securities Act and the rules and regulations  promulgated by the
SEC thereunder,  and (vi) the grant of awards under the Plan and the issuance of
shares of Common Stock  pursuant to such awards will comply with the  securities
laws of each state or jurisdiction applicable thereto (other than the Securities
Act), upon which assumptions the following opinion is expressly conditioned,  it
is the opinion of the  undersigned  that the  4,800,000  shares of Common  Stock
issuable by the Company pursuant to awards granted pursuant to the Plan will be,
when issued and delivered  against payment therefor in accordance with the Plan,
the  applicable  Agreement  and the  Registration  Statement,  duly  authorized,
validly issued, fully paid and non-assessable.

                                                                  Page 14 of 35
Turbodyne Technologies Inc.
August 14, 2000
Page 3

            This opinion is limited to the General  Corporation Law of the State
of Delaware and the Securities Act and the rules and regulations  promulgated by
the SEC thereunder,  to present judicial interpretations thereof and to facts as
they presently exist. In rendering this opinion, we have no obligation to revise
or  supplement  it  should  the  current  laws of the State of  Delaware  or the
Securities Act or such rules and  regulations be changed by legislative  action,
judicial  decision or  otherwise  or if we become aware of any facts that change
the opinion expressed herein after the date hereof.

            This opinion is issued to you solely for use in connection  with the
Registration  Statement and is not to be quoted or otherwise  referred to in any
financial  statements of the Company or related document,  nor is it to be filed
with or furnished to any  government  agency or other person,  without the prior
written consent of the undersigned in each instance.

            We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.

                                        Respectfully submitted,

                                    /s/ Sheppard, Mullin, Richter & Hampton LLP
                                    -------------------------------------------
                                        SHEPPARD, MULLIN, RICHTER & HAMPTON LLP

                                                                  Page 15 of 35
EXHIBIT 23.2
                                                                    ------------

                         CONSENT OF INDEPENDENT AUDITORS
                         -------------------------------

             We consent to the  incorporation  by reference in the  Registration
Statement  (Form S-8 333-0000)  pertaining to the 2000 Stock  Incentive  Plan of
Turbodyne  Technologies  Inc. of our report  dated April 4, 2000 with respect to
the consolidated  financial statements and schedules for Turbodyne  Technologies
Inc. for the year ended  December 31, 1999 included in the Annual Report on From
10-K of Turbodyne Technologies Inc. for the year ended December 31, 1999.

                                                    /s/ McGowan Guntermann
                                                    -----------------------
                                                     MCGOWAN GUNTERMANN

Santa Barbara, California

August 1, 2000

                                                                  Page 16 of 35
EXHIBIT 99.1
                                                                   ------------

                           TURBODYNE TECHNOLOGIES INC.

                            2000 STOCK INCENTIVE PLAN

1.  PURPOSE OF THE PLAN.

The  purpose  of this 2000  Stock  Incentive  Plan (the  "Plan")  is to  provide
incentives and rewards to selected eligible directors,  officers,  employees and
consultants of Turbodyne  Technologies  Inc. (the "Company") or its subsidiaries
in order to assist the Company and its subsidiaries in attracting, retaining and
motivating  those  persons  by  providing  for  or  increasing  the  proprietary
interests of those persons in the Company, and by associating their interests in
the Company with those of the Company's stockholders.

2.  ADMINISTRATION OF THE PLAN.

The Plan shall be  administered  by the Board of  Directors  of the Company (the
"Board"),  or a committee of the Board (the  "Committee")  whose  members  shall
serve at the  pleasure  of the Board.  If  administration  is  delegated  to the
Committee,  the Committee shall have, in connection with the  administration  of
the Plan, the powers theretofore  possessed by the Board (and references in this
Plan to the Board shall thereafter be to the Committee),  subject,  however,  to
such  resolutions,  not  inconsistent  with the provisions of the Plan as may be
adopted from time to time by the Board.

The  Board  shall  have all the  powers  vested  in it by the terms of the Plan,
including  exclusive  authority  (i) to select  from among  eligible  directors,
officers,  employees and  consultants,  those persons to be granted "Awards" (as
defined  below) under the Plan;  (ii) to determine  the type,  size and terms of
individual  Awards  (which  need  not be  identical)  to be made to each  person
selected;  (iii) to  determine  the time  when  Awards  will be  granted  and to
establish objectives and conditions (including,  without limitation, vesting and
performance conditions),  if any, for earning Awards; (iv) to amend the terms or
conditions of any outstanding  Award,  subject to applicable legal  restrictions
and to the  consent  of the other  party to such  Award;  (v) to  determine  the
duration  and purpose of leaves of  absences  which may be granted to holders of
Awards  without  constituting  termination  of their  employment for purposes of
their Awards; (vi) to authorize any person to execute, on behalf of the Company,
any instrument required to carry out the purposes of the Plan; and (vii) to make
any  and all  other  determinations  which  it  determines  to be  necessary  or
advisable in the administration of the Plan. The Board shall have full power and
authority to administer  and  interpret the Plan and to adopt,  amend and revoke
such  rules,  regulations,   agreements,  guidelines  and  instruments  for  the
administration  of the Plan and for the  conduct  of its  business  as the Board
deems necessary or advisable.  The Board's  interpretation  of the Plan, and all
actions taken and determinations made by the Board pursuant to the powers vested
in it  hereunder,  shall be  conclusive  and binding on all  parties  concerned,
including the Company,  its  stockholders,  any participants in the Plan and any
other employee of the Company or any of its subsidiaries.

                                       1
                                                                  Page 17 of 35
3.  PERSONS ELIGIBLE UNDER THE PLAN.

Any person who is a director, officer, employee or consultant of the Company, or
any of its  subsidiaries (a  "Participant"),  shall be eligible to be considered
for the grant of Awards under the Plan.

4.  AWARDS.

    (a)  COMMON STOCK AND DERIVATIVE  SECURITY AWARDS.  Awards  authorized under
         the Plan shall  consist of any type of  arrangement  with a Participant
         that is not  inconsistent  with the provisions of the Plan and that, by
         its terms,  involves or might involve or be made with  reference to the
         issuance of (i) shares of the Common Stock,  $.001 par value per share,
         of the Company (the "Common Stock") or (ii) a "derivative security" (as
         that term is defined in Rule 16a-1(c) of the Rules and  Regulations  of
         the Securities and Exchange  Commission  under the Securities  Exchange
         Act of 1934, as amended,  as the same may be amended from time to time)
         with an exercise or  conversion  price  related to the Common  Stock or
         with a value derived from the value of the Common Stock.

    (b)  TYPES OF AWARDS.  Awards are not  restricted to any  specified  form or
         structure and may include,  but need not be limited to, sales,  bonuses
         and other transfers of stock,  restricted stock, stock options,  reload
         stock options,  stock purchase warrants,  other rights to acquire stock
         or  securities   convertible  into  or  redeemable  for  stock,   stock
         appreciation rights,  phantom stock, dividend equivalents,  performance
         units or performance shares, or any other type of Award which the Board
         shall  determine is consistent  with the objectives and  limitations of
         the Plan. An Award may consist of one such security or benefit,  or two
         or more of them in tandem or in the alternative.

    (c)  CONSIDERATION.  Common Stock may be issued pursuant to an Award for any
         lawful  consideration  as determined by the Board,  including,  without
         limitation,  a cash payment,  services rendered, or the cancellation of
         indebtedness.

    (d)  GUIDELINES.  The Board  may  adopt,  amend or revoke  from time to time
         written policies  implementing the Plan. Such policies may include, but
         need not be limited to, the type, size and term of Awards to be made to
         participants and the conditions for payment of such Awards.

    (e)  TERMS AND CONDITIONS. Subject to the provisions of the Plan, the Board,
         in its sole and absolute  discretion,  shall determine all of the terms
         and conditions of each Award granted  pursuant to the Plan, which terms
         and conditions may include, among other things:

         (i)  any provision  necessary for such Award to qualify as an incentive
              stock  option under  Section 422 of the  Internal  Revenue Code of
              1986, as amended (the "Code") (an "Incentive Stock Option");

                                       2
                                                                  Page 18 of 35
(ii)  a  provision  permitting  the  recipient  of such Award to pay the
              purchase  price of the  Common  Stock or other  property  issuable
              pursuant to such Award, or to pay such recipient's tax withholding
              obligation with respect to such issuance,  in whole or in part, by
              delivering previously owned shares of capital stock of the Company
              (including  "pyramiding")  or other  property,  or by reducing the
              number of shares of Common  Stock or the amount of other  property
              otherwise issuable pursuant to such Award; or

       (iii)  a provision  conditioning or accelerating  the receipt of benefits
              pursuant  to  the  Award,   or  terminating   the  Award,   either
              automatically  or  in  the  discretion  of  the  Board,  upon  the
              occurrence of specified events,  including,  without limitation, a
              change of control of the Company,  an  acquisition  of a specified
              percentage of the voting power of the Company,  the dissolution or
              liquidation  of the Company,  a sale of  substantially  all of the
              property  and  assets  of the  Company  or an  event  of the  type
              described in Section 7 of the Plan.

    (f)  SUSPENSION OR  TERMINATION  OF AWARDS.  If the Company  believes that a
         Participant has committed an act of misconduct as described  below, the
         Company may suspend the Participant's rights under any then outstanding
         Award pending a  determination  by the Board.  If the Board  determines
         that  a  Participant  has  committed  an act  of  embezzlement,  fraud,
         nonpayment  of any  obligation  owed to the Company or any  subsidiary,
         breach of fiduciary duty or deliberate disregard of the Company's rules
         resulting in loss, damage or injury to the Company, or if a Participant
         makes an  unauthorized  disclosure  of  trade  secret  or  confidential
         information of the Company,  engages in any conduct constituting unfair
         competition,  or  induces  any  customer  of the  Company  to  breach a
         contract  with the  Company,  neither  the  Participant  nor his or her
         estate shall be entitled to exercise any rights whatsoever with respect
         to such Award. In making such determination, the Board shall act fairly
         and shall give the  Participant a reasonable  opportunity to appear and
         present evidence on his or her behalf to the Board.

    (g)  MAXIMUM  GRANT OF  AWARDS  TO ANY  PARTICIPANT.  No  Participant  shall
         receive  Awards  representing  more than 500,000 shares of Common Stock
         per annum, subject to adjustment as provided in Section 7 hereof.

5.  SHARES OF COMMON STOCK SUBJECT TO THE PLAN.

The  aggregate  number of shares of Common  Stock that may be issued or issuable
pursuant to all Awards under the Plan (including Awards in the form of Incentive
Stock Options and Non-Statutory  Stock Options) shall not exceed an aggregate of
4,800,000 shares of Common Stock, subject to adjustment as provided in Section 7
of the Plan.

Shares of Common Stock subject to the Plan may consist,  in whole or in part, of
authorized and unissued  shares or treasury  shares.  Any shares of Common Stock
subject to an Award which for any reason expires or is terminated unexercised as

                                       3
                                                                  Page 19 of 35
to such  shares  shall  again be  available  for  issuance  under the Plan.  For
purposes of this Section 5, the aggregate  number of shares of Common Stock that
may be issued at any time  pursuant  to Awards  granted  under the Plan shall be
reduced by: (i) the number of shares of Common Stock previously  issued pursuant
to Awards granted under the Plan, other than shares of Common Stock subsequently
reacquired  by the Company  pursuant to the terms and  conditions of such Awards
and with respect to which the holder thereof  received no benefits of ownership,
such as  dividends;  and (ii) the  number of shares of Common  Stock  which were
otherwise  issuable  pursuant to Awards  granted  under this Plan but which were
withheld by the  Company as payment of the  purchase  price of the Common  Stock
issued  pursuant to such Awards or as payment of the recipient's tax withholding
obligation with respect to such issuance.

6.  PAYMENT OF AWARDS.

The Board shall  determine  the extent to which Awards shall be payable in cash,
shares of Common Stock or any combination  thereof.  The Board may, upon request
of a  Participant,  determine  that  all  or a  portion  of a  payment  to  that
Participant  under the Plan,  whether it is to be made in cash, shares of Common
Stock or a combination thereof,  shall be deferred.  Deferrals shall be for such
periods and upon such terms as the Board may determine in its sole discretion.

7.  DILUTION AND OTHER ADJUSTMENT.

In the event of any  change in the  outstanding  shares of the  Common  Stock or
other securities then subject to the Plan by reason of any stock split,  reverse
stock  split,   stock   dividend,   recapitalization,   merger,   consolidation,
combination or exchange of shares or other similar  corporate  change, or if the
outstanding  securities  of the class then subject to the Plan are exchanged for
or converted into cash, property or a different kind of securities,  or if cash,
property or securities are distributed in respect of such outstanding securities
as a class (other than cash dividends),  then the Board may, but it shall not be
required  to,  make  such  equitable  adjustments  to the  Plan  and the  Awards
thereunder  (including,   without  limitation,   appropriate  and  proportionate
adjustments in (i) the number and type of shares or other  securities or cash or
other  property  that may be acquired  pursuant to Incentive  Stock  Options and
other Awards  theretofore  granted under the Plan,  (ii) the maximum  number and
type of shares or other  securities  that may be issued  pursuant  to  Incentive
Stock Options and other Awards thereafter  granted under the Plan; and (iii) the
maximum  number of  securities  with respect to which Awards may  thereafter  be
granted  to any  Participant  in any  fiscal  year)  as the  Board  in its  sole
discretion  determines  appropriate,  including any  adjustments  in the maximum
number of shares referred to in Section 5 of the Plan. Such adjustments shall be
conclusive and binding for all purposes of the Plan.

8.  MISCELLANEOUS PROVISIONS.

    (a)  DEFINITIONS.  As used herein,  "subsidiary" means any current or future
         corporation which would be a "subsidiary  corporation," as that term is
         defined in Section  424(f) of the Code,  of the  Company;  and the term
         "or" means "and/or."

                                       4
                                                                  Page 20 of 35
(b)  CONDITIONS  ON  ISSUANCE.  Securities  shall not be issued  pursuant to
         Awards  unless the grant and  issuance  thereof  shall  comply with all
         relevant  provisions  of law and  the  requirements  of any  securities
         exchange or quotation  system upon which any  securities of the Company
         are listed, and shall be further subject to approval of counsel for the
         Company  with respect to such  compliance.  Inability of the Company to
         obtain  authority from any regulatory body having  jurisdiction,  which
         authority  is  determined  by Company  counsel to be  necessary  to the
         lawful  issuance and sale of any security or Award,  shall  relieve the
         Company of any liability in respect of the  nonissuance or sale of such
         securities  as  to  which  requisite  authority  shall  not  have  been
         obtained.

    (c)  RIGHTS AS  STOCKHOLDER.  A  participant  under the Plan  shall  have no
         rights as a holder of Common  Stock with  respect to Awards  hereunder,
         unless  and until  certificates  for shares of such stock are issued to
         the participant.

    (d)  ASSIGNMENT OR TRANSFER.  Subject to the  discretion  of the Board,  and
         except  with  respect  to  Incentive   Stock   Options  which  are  not
         transferable  except by will or the laws of descent  and  distribution,
         Awards  under the Plan or any  rights  or  interests  therein  shall be
         assignable or  transferable to the extent provided in the written grant
         agreement.

    (e)  AGREEMENTS.  All Awards  granted  under the Plan shall be  evidenced by
         written   agreements  in  such  form  and  containing  such  terms  and
         conditions  (not  inconsistent  with the Plan) as the Board  shall from
         time to time adopt.

    (f)  WITHHOLDING  TAXES. The Company shall have the right to deduct from all
         Awards  hereunder  paid in cash any  federal,  state,  local or foreign
         taxes  required by law to be withheld  with respect to such awards and,
         with respect to awards paid in stock,  to require the payment  (through
         withholding  from the  participant's  salary or  otherwise) of any such
         taxes. The obligation of the Company to make delivery of Awards in cash
         or Common Stock shall be subject to the restrictions imposed by any and
         all governmental authorities.

    (g)  NO RIGHTS TO AWARD. No Participant or other person shall have any right
         to be granted an Award under the Plan.  Neither the Plan nor any action
         taken  hereunder shall be construed as giving any Participant any right
         to be retained in the employ of the Company or any of its  subsidiaries
         or  shall  interfere  with or  restrict  in any way the  rights  of the
         Company  or any of its  subsidiaries,  which are  hereby  reserved,  to
         discharge a Participant at any time for any reason whatsoever,  with or
         without good cause.

    (h)  COSTS AND EXPENSES.  The costs and expenses of  administering  the Plan
         shall be borne by the  Company  and not charged to any Award nor to any
         Participant receiving an Award.

    (i)  FUNDING OF PLAN.  The Plan shall be unfunded.  The Company shall not be
         required to establish any special or separate fund or to make any other
         segregation  of assets to assure  the  payment  of any Award  under the
         Plan.

                                       5
                                                                  Page 21 of 35
9.  AMENDMENTS AND TERMINATION.

    (a)  AMENDMENTS.  The Board may at any time  terminate  or from time to time
         amend the Plan in whole or in part, but no such action shall  adversely
         affect any rights or obligations with respect to any Awards theretofore
         made  under the Plan.  However,  with the  consent  of the  Participant
         affected,  the Board may amend outstanding agreements evidencing Awards
         under the Plan in a manner not inconsistent with the terms of the Plan.

    (b)  STOCKHOLDER APPROVAL. To the extent that Section 422 of the Code, other
         applicable  law,  or the  rules,  regulations,  procedures  or  listing
         agreement of any  national  securities  exchange or  quotation  system,
         requires that any amendment of the Plan be approved by the stockholders
         of the Company,  no such amendment shall be effective  unless and until
         it is  approved  by the  stockholders  in such a  manner  and to such a
         degree as is required.

    (c)  TERMINATION.  Unless the Plan shall theretofore have been terminated as
         above provided,  the Plan (but not the awards theretofore granted under
         the Plan)  shall  terminate  on and no awards  shall be  granted  after
         September 11, 2008.

10. EFFECTIVE DATE.

The Plan is  effective  on October 1, 1999,  the date on which it was adopted by
the Executive Committee of the Board of Directors of the Company.

11. FORM S-8 REGISTRATION STATEMENT.

The Company intends to file a Registration  Statement on Form S-8, or such other
form as counsel for the Company determines appropriate, to register the issuance
of shares by the Company  upon the exercise of any options  granted  pursuant to
the Plan. Prior to the filing and  effectiveness of the Registration  Statement,
any shares issued upon the exercise of options  granted  pursuant to the Plan to
U.S.  resident  shareholders  will be issued  pursuant  to  Section  4(2) of the
Securities  Act of 1933 and  will be  subject  to  appropriate  restrictions  on
transfer. Any shares issued upon the exercise of options granted pursuant to the
Plan to persons who are not U.S. Persons, as defined in Regulation S promulgated
pursuant  to the  Securities  Act of  1933,  shall  be  issued  in  reliance  of
Regulation  S and  subject to the  conditions  of  Regulation  S  including  the
agreement of the  Participants  not to resell the shares to a U.S. Person or for
the  account  or  benefit  of a U.S.  Person  until  expiry of the  distribution
compliance period.

                                       6
                                                                  Page 22 of 35
12. GOVERNING LAW

The Plan and any  agreements  entered into  thereunder  shall be  construed  and
governed  by the laws of the State of  Delaware  applicable  to  contracts  made
within,  and to be performed  wholly within,  such state,  without regard to the
application of conflict of laws rules thereof.

                                       7
                                                                  Page 23 of 35
EXHIBIT 99.2
                                                                  ------------

                       INCENTIVE STOCK OPTION AGREEMENT

      THIS INCENTIVE STOCK OPTION  AGREEMENT is made as of the Date of Grant set
forth below, between TURBODYNE  TECHNOLOGIES,  INC., a Delaware corporation (the
"Company"),  and the  employee  of the  Company  whose name  appears  below (the
"Optionee").  All capitalized  terms not specifically  defined herein shall have
the meanings set forth in the Company's 2000 Stock Incentive Plan (the "Plan").

                                   RECITALS

      A.    The  Board  of  Directors  and  the shareholders of the Company both
approved and adopted the Plan.  The Plan  provides for the granting of awards to
directors,  officers,  employees  and  consultants  of the Company or any of its
affiliates.

      B.    Pursuant  to  the  Plan,  the  Plan is administered by the Committee
appointed by and comprised of members of the Company's Board of Directors.

      C.    Pursuant to the Plan, the Compensation  Committee (the  "Committee")
has  determined  that it is to the  advantage  and in the best  interests of the
Company and its  shareholders to grant an incentive stock option to the Optionee
covering shares of the Company's  Common Stock (or any class of stock into which
such Common Stock is converted or reclassified as provided in the Plan) ("Common
Stock")  as an  inducement  to remain in the  service of the  Company  and as an
incentive  for  increased  effort  during such  service,  and has  approved  the
execution of this Incentive Stock Option  Agreement  between the Company and the
Optionee.

      D.    The  option  granted  hereby is intended to qualify as an "incentive
stock option" under Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code").

      NOW, THEREFORE, the parties hereto agree as follows:

            1. Grant of Option.  Effective  as of the date of grant set forth on
the  signature  page  hereof (the "Date of  Grant"),  the Company  grants to the
Optionee  the right and  option  (the  "Option")  to  purchase  on the terms and
conditions  hereinafter  set forth,  all or any part of such number of shares of
Common  Stock at such  purchase  price per share as are set forth  below,  which
price  is not less  than the fair  market  value of such  stock  (as  determined
pursuant to Section 4 hereof) on the Date of Grant;  provided,  however, that if
the Optionee  possesses more than ten percent (10%) of the total combined voting
power of all  classes  of  stock of the  Company  (and its  affiliates)  (a "10%
Shareholder"), such price is not less than one hundred and ten percent (110%) of
the fair market value of such stock (as determined pursuant to Section 4) on the
Date of Grant.  The Option shall be exercisable  from time to time in accordance
with the  provisions  of this  Agreement  during a period  expiring on the tenth
anniversary  of the  Date  of  Grant  (the  "Expiration  Date")  or  earlier  in

                                    -1-
                                                                  Page 24 of 35
accordance with Section 5; provided, however, that it the Option is granted to a
10% Shareholder,  the Expiration Date shall be the fifth anniversary of the Date
of Grant.

            2. Vesting.  The Option shall become  exercisable  to purchase,  and
shall  vest with  respect  to,  such  percentage  of the shares  covered  hereby
(rounded to the nearest whole share) as may be set forth on the  signature  page
hereof.  In each  case the  number of shares  which  may be  purchased  shall be
calculated to the nearest full share.

            3. Manner of Exercise. Each exercise of the Option shall be by means
of a written notice of exercise delivered to the Company,  specifying the number
of shares to be purchased and  accompanied by payment to the Company of the full
purchased  price of the  shares to be  purchased  solely (i) in cash or by check
payable to the order of the Company,  (ii) by delivery of shares of Common Stock
of the Company already owned by, and in the possession of, the Optionee,  valued
at their fair market value, as determined in accordance with Section 4, or (iii)
(x) by a  promissory  note made by  Optionee in favor of the  Company,  upon the
terms and conditions  determined by the Committee  including,  to the extent the
Committee  determines  appropriate,  a security  interest in the shares issuable
upon exercise or other property, or (y) through a "cashless exercise," in either
case complying with applicable law  (including,  without  limitation,  state and
federal margin requirements), or any combination thereof. Shares of Common Stock
used to satisfy the exercise  price of this Option shall be valued at their fair
market value  determined  (in  accordance  with Section 4 hereof) on the date of
exercise (or if such date is not a business day, as of the close of the business
day immediately preceding date). This Option may not be exercised for a fraction
of a share and no partial  exercise  of this Option may be for less than (a) one
hundred  (100)  shares or (b) the  total  number of  shares  then  eligible  for
exercise, if less than one hundred (100) shares.

            The Option may be exercised  (i) during the lifetime of the Optionee
only by the  Optionee;  (ii) to the extent  permitted by the Committee or by the
terms of this  Agreement,  Optionee's  spouse if such spouse obtained the Option
pursuant to a  qualified  domestic  relations  ordered as defined by the Code of
Title  I of  ERISA,  or the  rules  thereunder  ("Qualified  Domestic  Relations
Order");  and (iii) after the Optionee's death by his or her transferees by will
or the laws of descent or distribution.

            4. Fair Market  Value of Common  Stock.  The fair market  value of a
share of Common  Stock shall be  determined  for  purposes of this  Agreement by
reference to the closing  price on the  principal  stock  exchange on which such
shares  are then  listed  or,  if such  shares  are not then  listed  on a stock
exchange,  by reference to the closing  price (if approved for  quotation on the
NASDAQ  National  Market System) or the mean between the bid and asked price (if
other  over-the-counter  issue)  of  a  share  as  supplied   by   the  National
Association  of Securities  Dealers,  Inc.  through  NASDAQ (or its successor in
function), in each case as reported by The Wall Street Journal, for the business
day immediately  preceding the date on which the option is granted  (which,  for
all purposes, shall be the Date of Grant) or exercised (or, if for any reason no
such  price  is  available,  in such  other  manner  as the  Committee  may deem
appropriate to reflect the then fair market value thereof).

                                    -2-
                                                                  Page 25 of 35
5. Termination of Employment;  Death or Permanent Disability. If the
Optionee  ceases to be employed by the Company or one of its  affiliates for any
reason other than the  Optionee's  death or "permanent  disability"  (within the
meaning of Section 22(e)(3) of the Code), the Option shall be exercisable  until
the earlier of (i) the Expiration Date or (ii) a date three (3) months after the
date the Optionee ceases to be an employee of the Company or such affiliate,  to
the extent  exercisable on the date of such  cessation of employment,  and shall
thereafter  expire  and be void and of no further  force or  effect.  A leave of
absence  approved in writing by the Committee  shall not be deemed a termination
of  employment  for the  purposes  of this  Section 5, but the Option may not be
exercised  during any such leave of absence,  except  during the first three (3)
months thereof. If the Optionee dies or becomes "permanently disabled" while the
Optionee is employed by the Company or one of its  affiliates,  the Option shall
expire on the  earlier  of (i) the  Expiration  Date or (ii) a date one (1) year
after  the  date  of  such  death  or  "permanent  disability,"  to  the  extent
exercisable on the date of death or permanent  disability,  and shall thereafter
expire and be void and of no further  force or effect.  During such period after
death,  the  Option  may,  to the  extent  that  it  remained  unexercised  (but
exercisable by the Optionee according to the Option's terms) on the date of such
death, be exercised by the person or persons to whom the Optionee's rights under
the Option  shall  pass by the  Optionee's  will or by the laws of  descent  and
distribution.

            6. Shares to be Issued in Compliance  with Federal  Securities  Laws
and Exchange Rules. By accepting the Option, the Optionee represents and agrees,
for the Optionee and his or her legal successors (by will or the laws of descent
and distribution or through a Qualified Domestic Relations Order),  that none of
the shares purchased upon exercise of the Option will be acquired with a view to
any sale, transfer or distribution of said shares in violation of the Securities
Act of 1933, as amended (the  "Securities  Act"),  and the rules and regulations
promulgated thereunder,  or any applicable state "blue sky" laws. If required by
the  Committee  at the time the Option is  exercised,  the Optionee or any other
person  entitled to exercise the Option shall furnish  evidence  satisfactory to
the Company  (including a written and signed  representation)  to such effect in
form and substance satisfactory to the Company,  including an indemnification of
the Company in the event of any  violation of the  Securities  Act or state blue
sky laws by such person.  The Company shall use  reasonable  efforts to take all
necessary  and  appropriate  action to assure that the shares  issuable upon the
exercise of this Option shall be issued in full  compliance  with the Securities
Act,  state  blue  sky  laws  and all  applicable  listing  requirements  of any
principal securities exchange on which shares of the same class are listed.

            7. Withholding of Taxes. Upon any disposition by the Optionee or the
Optionee's  legal  successor of shares of Common Stock acquired  pursuant to the
exercise  of this  Option  within  two (2) years of the Date of Grant or one (1)
year of the exercise of this Option (an "Early Disposition"),  the Company shall
have the right to require the Optionee or the Optionee's  legal successor to pay
the  Company  the  amount of any taxes  which the  Company  may be  required  to
withhold with respect to such shares.

            8. No Assignment. The  Option  and  all  other rights and privileges
granted  hereby are not  transferable  except by will or the laws of descent and
distribution or by Optionee's spouse if such spouse obtained the Option pursuant
to a qualified domestic relations.

                                    -3-
                                                                  Page 26 of 35
9.  Adjustment  for  Reorganizations,  Stock  Splits,  etc.  If  the
outstanding  shares of Common Stock of the Company (or any other class of shares
or securities  which shall have become issuable upon the exercise of this Option
pursuant to this sentence) are increased,  decreased,  changed into or exchanged
for a different  number or kind of shares or securities  of the Company  through
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse  stock  split  or  other  similar   transaction,   an  appropriate   and
proportionate  adjustment shall be made in the maximum number and kind of shares
receivable  upon the exercise of this Option,  without change in the total price
applicable to the unexercised  portion of this Option,  but with a corresponding
adjustment in the price for each share or other unit of any security  covered by
this Option.

            Upon  the  dissolution  or  liquidation  of the  Company,  or upon a
reorganization,  merger  or  consolidation  of the  Company  with  one  or  more
corporations as a result of which the Company is not the surviving  corporation,
or upon a sale of  substantially  all the  property or more than eighty  percent
(80%) of the then outstanding stock of the Company to another corporation,  this
Option shall terminate.
            Adjustments  under  this  Section 9 shall be made by the  Committee,
whose  determination  as to what  adjustments  shall  be  made,  and the  extent
thereof,  shall be final, binding and conclusive.  No fractional shares of stock
shall be issued under this Option on any such adjustment.

            10.  Participation  by the Optionee in Other Company Plans.  Nothing
herein  contained  shall affect the right of the Optionee to  participate in and
receive benefits under and in accordance with the then current provisions of any
pension,  insurance, profit sharing or other employee welfare plan or program of
the Company or of any subsidiary of the Company.

            11. No Rights as a Shareholder Until Issuance of Stock  Certificate.
Neither the  Optionee  nor any other person  legally  entitled to exercise  this
Option shall be entitled to any of the rights or privileges of a shareholder  of
the Company in respect of any shares  issuable  upon any  exercise of the Option
unless and until a certificate or  certificates  representing  such shares shall
have been  actually  issued and  delivered to the  Optionee.  No shares shall be
issued and  delivered  upon the  exercise of this Option  unless and until there
shall  have  been  full  compliance  with  all  applicable  requirements  of the
Securities  Act  (whether  by  registration  or  satisfaction  of  an  exemption
therefrom),  all  applicable  listing  requirements  of  a  national  securities
exchange on which shares of the same class are listed and any other requirements
of law or of any regulatory  bodies having  jurisdiction  over such issuance and
delivery.

            12. Not an Employment or Service Contract.  Nothing herein contained
shall be  construed  as an  agreement  by the Company or any of its  affiliates,
express or  implied,  to employ the  Optionee  or  contract  for the  Optionee's
services,  to restrict the Company's or such affiliate's  right to discharge the
Optionee or cease contracting for the Optionee's  services or to modify,  extend
or  otherwise  affect in any  manner  whatsoever,  the  terms of any  employment
agreement or contract for services  which may exist between the Optionee and the
Company or any of its affiliates.

            13. Agreement Subject to the Plan.  The  Option  hereby  granted  is
subject to, and the Company  and the  Optionee  agree to be bound by, all of the

                                    -4-
                                                                  Page 27 of 35
terms and conditions of the Plan, as the same shall be amended from time to time
in accordance  with the terms  thereof,  but no such amendment  shall  adversely
affect the Optionee's rights under this Option without the prior written consent
of the Optionee.

            14. Execution.  The  interpretation,  performance and enforcement of
this Agreement shall be governed by the internal  substantive  laws of the State
of California.

                  COMPANY:                TURBODYNE TECHNOLOGIES INC.

                                          By_______________________________

                                          Its_______________________________

                  OPTIONEE:

                                          ---------------------------------
                                          Name

                                    -5-
                                                                  Page 28 of 35
By his or her  signature  below,  the spouse of the Optionee  agrees to be
bound by all of the terms and conditions of the foregoing Agreement.

                  OPTIONEE'S SPOUSE:

                                          ---------------------------------
                                          Name

      The following  terms and  conditions are an integral part of the foregoing
Incentive Stock Option Agreement.

            Optionee:                      _________________________________

            Address:                       _________________________________
                                           _________________________________

            Social Security Number:        _________________________________

            Date of Grant:                 _________________________________

            Number of shares purchasable:  _________________________________

            Exercise Price per share:      _________________________________

            Expiration Date:               _________________________________

     Anniversary Date         Percentage Initially      Cumulative Percentage
   of the Date of Grant           Exercisable                Exercisable
--------------------------------------------------------------------------------
          First
--------------------------------------------------------------------------------
          Second
--------------------------------------------------------------------------------
          Third
--------------------------------------------------------------------------------
          Fourth
--------------------------------------------------------------------------------

                                    -6-
                                                                  Page 29 of 35
EXHIBIT 99.3
                                                                  ------------

                     NON-QUALIFIED STOCK OPTION AGREEMENT

      THIS NON-QUALIFIED  STOCK OPTION AGREEMENT is made as of the Date of Grant
set forth below,  between TURBODYNE  TECHNOLOGIES  INC., a Delaware  corporation
(the  "Company"),  and the employee of the Company whose name appears below (the
"Optionee").  All capitalized  terms not specifically  defined herein shall have
the meanings set forth in the Company's 2000 Stock Incentive Plan (the "Plan").

                                   RECITALS

      A.    The  Board  of  Directors  and  the shareholders of the Company both
approved and adopted the Plan.  The Plan  provides for the granting of awards to
directors,  officers,  employees  and  consultants  of the Company or any of its
affiliates.

      B.    Pursuant  to  the  Plan,  the  Plan is administered by the Committee
appointed by and comprised of members of the Company's Board of Directors.

      C.    Pursuant to the Plan, the Compensation  Committee (the  "Committee")
has  determined  that it is to the  advantage  and in the best  interests of the
Company  and its  shareholders  to grant an  non-qualified  stock  option to the
Optionee  covering  shares of the Company's  Common Stock (or any class of stock
into which such Common  Stock is converted  or  reclassified  as provided in the
Plan) ("Common  Stock") as an inducement to remain in the service of the Company
and as an incentive for increased  effort during such service,  and has approved
the execution of this  Non-Qualified  Stock Option Agreement between the Company
and the Optionee.

      D.    The  option  granted  hereby  is  not intended  to  qualify   as  an
"incentive stock option" under Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").

      NOW, THEREFORE, the parties hereto agree as follows:

            1. Grant of Option. The Company grants to the Optionee the right and
option (the  "Option") to purchase on the terms and conditions  hereinafter  set
forth, all or any part of such number of shares of Common Stock at such purchase
price per share as are set forth  below,  which  price is not less than the fair
market value of such stock (as  determined  pursuant to Section 4 hereof) on the
Date of Grant.  The Option shall be exercisable  from time to time in accordance
with the  provisions  of this  Agreement  during a period  expiring on the tenth
anniversary  of the  Date  of  Grant  (the  "Expiration  Date")  or  earlier  in
accordance with Section 5.

            2. Vesting.  The  Option  shall  become exercisable to purchase, and
shall  vest with  respect  to,  such  percentage  of the shares  covered  hereby

                                    -1-
                                                                  Page 30 of 35
(rounded to the nearest whole share) as may be set forth on the  signature  page
hereof.  In each  case the  number of shares  which  may be  purchased  shall be
calculated to the nearest full share.

            3. Manner of Exercise. Each exercise of the Option shall be by means
of a written notice of exercise delivered to the Company,  specifying the number
of shares to be purchased and  accompanied by payment to the Company of the full
purchased  price of the  shares to be  purchased  solely (i) in cash or by check
payable to the order of the Company,  (ii) by delivery of shares of Common Stock
of the Company already owned by, and in the possession of, the Optionee,  valued
at their fair market value, as determined in accordance with Section 4, or (iii)
(x) by a  promissory  note made by  Optionee in favor of the  Company,  upon the
terms and conditions  determined by the Committee  including,  to the extent the
Committee  determines  appropriate,  a security  interest in the shares issuable
upon exercise or other property, or (y) through a "cashless exercise," in either
case complying with applicable law  (including,  without  limitation,  state and
federal margin requirements), or any combination thereof. Shares of Common Stock
used to satisfy the exercise  price of this Option shall be valued at their fair
market value  determined  (in  accordance  with Section 4 hereof) on the date of
exercise (or if such date is not a business day, as of the close of the business
day immediately preceding date). This Option may not be exercised for a fraction
of a share and no partial  exercise  of this Option may be for less than (a) one
hundred  (100)  shares or (b) the  total  number of  shares  then  eligible  for
exercise, if less than one hundred (100) shares.

            The Option may be exercised  (i) during the lifetime of the Optionee
only by the  Optionee;  (ii) to the extent  permitted by the Committee or by the
terms of this  Agreement,  Optionee's  spouse if such spouse obtained the Option
pursuant to a  qualified  domestic  relations  ordered as defined by the Code of
Title  I of  ERISA,  or the  rules  thereunder  ("Qualified  Domestic  Relations
Order");  and (iii) after the Optionee's death by his or her transferees by will
or the laws of descent or distribution.

            4. Fair Market  Value of Common  Stock.  The fair market  value of a
share of Common  Stock shall be  determined  for  purposes of this  Agreement by
reference to the closing  price on the  principal  stock  exchange on which such
shares  are then  listed  or,  if such  shares  are not then  listed  on a stock
exchange,  by reference to the closing  price (if approved for  quotation on the
NASDAQ  National  Market System) or the mean between the bid and asked price (if
other   over-the-counter  issue)  of  a  share  as  supplied   by  the  National
Association  of Securities  Dealers,  Inc.  through  NASDAQ (or its successor in
function), in each case as reported by The Wall Street Journal, for the business
day immediately  preceding the date on which the option is granted  (which,  for
all purposes, shall be the Date of Grant) or exercised (or, if for any reason no
such  price  is  available,  in such  other  manner  as the  Committee  may deem
appropriate to reflect the then fair market value thereof).

            5. Termination of Employment;  Death or Permanent Disability. If the
Optionee  ceases to be employed by the Company or one of its  affiliates for any
reason other than the  Optionee's  death or "permanent  disability"  (within the
meaning of Section 22(e)(3) of the Code), the Option shall be exercisable  until
the earlier of (i) the Expiration Date or (ii) a date three (3) months after the
date the Optionee ceases to be an employee of the Company or such affiliate,  to
the extent  exercisable on the date of such  cessation of employment,  and shall
thereafter  expire  and be void and of no further  force or  effect.  A leave of

                                    -2-
                                                                  Page 31 of 35
absence  approved in writing by the Committee  shall not be deemed a termination
of  employment  for the  purposes  of this  Section 5, but the Option may not be
exercised  during any such leave of absence,  except  during the first three (3)
months thereof. If the Optionee dies or becomes "permanently disabled" while the
Optionee is employed by the Company or one of its  affiliates,  the Option shall
expire on the  earlier  of (i) the  Expiration  Date or (ii) a date one (1) year
after  the  date  of  such  death  or  "permanent  disability,"  to  the  extent
exercisable on the date of death or permanent  disability,  and shall thereafter
expire and be void and of no further  force or effect.  During such period after
death,  the  Option  may,  to the  extent  that  it  remained  unexercised  (but
exercisable by the Optionee according to the Option's terms) on the date of such
death, be exercised by the person or persons to whom the Optionee's rights under
the Option  shall  pass by the  Optionee's  will or by the laws of  descent  and
distribution.

            6. Shares to be Issued in Compliance  with Federal  Securities  Laws
and Exchange Rules. By accepting the Option, the Optionee represents and agrees,
for the Optionee and his or her legal successors (by will or the laws of descent
and distribution or through a Qualified Domestic Relations Order),  that none of
the shares purchased upon exercise of the Option will be acquired with a view to
any sale, transfer or distribution of said shares in violation of the Securities
Act of 1933, as amended (the  "Securities  Act"),  and the rules and regulations
promulgated thereunder,  or any applicable state "blue sky" laws. If required by
the  Committee  at the time the Option is  exercised,  the Optionee or any other
person  entitled to exercise the Option shall furnish  evidence  satisfactory to
the Company  (including a written and signed  representation)  to such effect in
form and substance satisfactory to the Company,  including an indemnification of
the Company in the event of any  violation of the  Securities  Act or state blue
sky laws by such person.  The Company shall use  reasonable  efforts to take all
necessary  and  appropriate  action to assure that the shares  issuable upon the
exercise of this Option shall be issued in full  compliance  with the Securities
Act,  state  blue  sky  laws  and all  applicable  listing  requirements  of any
principal securities exchange on which shares of the same class are listed.

            7. Withholding of Taxes. Upon any disposition by the Optionee or the
Optionee's  legal  successor of shares of Common Stock acquired  pursuant to the
exercise  of this  Option  within  two (2) years of the Date of Grant or one (1)
year of the exercise of this Option (an "Early Disposition"),  the Company shall
have the right to require the Optionee or the Optionee's  legal successor to pay
the  Company  the  amount of any taxes  which the  Company  may be  required  to
withhold with respect to such shares.

            8. No  Assignment.  Subject  to  the  discretion  of  the  Board  of
Directors,  awards  granted  hereby or any rights or interests  therein shall be
assignable or transferable to the extent provided herein.

            9.  Adjustment  for  Reorganizations,  Stock  Splits,  etc.   If the
outstanding  shares of Common Stock of the Company (or any other class of shares
or securities  which shall have become issuable upon the exercise of this Option
pursuant to this sentence) are increased,  decreased,  changed into or exchanged
for a different  number or kind of shares or securities  of the Company  through
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse  stock  split  or  other  similar   transaction,   an  appropriate   and
proportionate  adjustment shall be made in the maximum number and kind of shares

                                    -3-
                                                                  Page 32 of 35
receivable  upon the exercise of this Option,  without change in the total price
applicable to the unexercised  portion of this Option,  but with a corresponding
adjustment in the price for each share or other unit of any security  covered by
this Option.

            Upon  the  dissolution  or  liquidation  of the  Company,  or upon a
reorganization,  merger  or  consolidation  of the  Company  with  one  or  more
corporations as a result of which the Company is not the surviving  corporation,
or upon a sale of  substantially  all the  property or more than eighty  percent
(80%) of the then outstanding stock of the Company to another corporation,  this
Option shall terminate.

            Adjustments  under  this  Section 9 shall be made by the  Committee,
whose  determination  as to what  adjustments  shall  be  made,  and the  extent
thereof,  shall be final, binding and conclusive.  No fractional shares of stock
shall be issued under this Option on any such adjustment.

            10. Participation  by  the Optionee in Other Company Plans.  Nothing
herein  contained  shall affect the right of the Optionee to  participate in and
receive benefits under and in accordance with the then current provisions of any
pension,  insurance, profit sharing or other employee welfare plan or program of
the Company or of any subsidiary of the Company.

            11. No Rights as a Shareholder Until Issuance of Stock  Certificate.
Neither the  Optionee  nor any other person  legally  entitled to exercise  this
Option shall be entitled to any of the rights or privileges of a shareholder  of
the Company in respect of any shares  issuable  upon any  exercise of the Option
unless and until a certificate or  certificates  representing  such shares shall
have been  actually  issued and  delivered to the  Optionee.  No shares shall be
issued and  delivered  upon the  exercise of this Option  unless and until there
shall  have  been  full  compliance  with  all  applicable  requirements  of the
Securities  Act  (whether  by  registration  or  satisfaction  of  an  exemption
therefrom),  all  applicable  listing  requirements  of  a  national  securities
exchange on which shares of the same class are listed and any other requirements
of law or of any regulatory  bodies having  jurisdiction  over such issuance and
delivery.

            12. Not an Employment or Service Contract.  Nothing herein contained
shall be  construed  as an  agreement  by the Company or any of its  affiliates,
express or  implied,  to employ the  Optionee  or  contract  for the  Optionee's
services,  to restrict the Company's or such affiliate's  right to discharge the
Optionee or cease contracting for the Optionee's  services or to modify,  extend
or  otherwise  affect in any  manner  whatsoever,  the  terms of any  employment
agreement or contract for services  which may exist between the Optionee and the
Company or any of its affiliates.

            13.  Agreement  Subject to the Plan.  The Option  hereby  granted is
subject to, and the Company  and the  Optionee  agree to be bound by, all of the
terms and conditions of the Plan, as the same shall be amended from time to time
in accordance  with the terms  thereof,  but no such amendment  shall  adversely
affect the Optionee's rights under this Option without the prior written consent
of the Optionee.

                                    -4-
                                                                  Page 33 of 35
14. Execution.  The  interpretation,  performance and enforcement of
this Agreement shall be governed by the internal  substantive  laws of the State
of California.

                  COMPANY:                TURBODYNE TECHNOLOGIES INC.

                                          By_______________________________

                                          Its_______________________________

                  OPTIONEE:

                                          ---------------------------------
                                          Name

                                    -5-
                                                                  Page 34 of 35
By his or her  signature  below,  the spouse of the Optionee  agrees to be
bound by all of the terms and conditions of the foregoing Agreement.

                  OPTIONEE'S SPOUSE:

                                          ---------------------------------
                                          Name

      The following  terms and  conditions are an integral part of the foregoing
Incentive Stock Option Agreement.

            Optionee:                      _________________________________

            Address:                       _________________________________
                                           _________________________________

            Social Security Number:        _________________________________

            Date of Grant:                 _________________________________

            Number of shares purchasable:  _________________________________

            Exercise Price per share:      _________________________________

            Expiration Date:               _________________________________

     Anniversary Date         Percentage Initially      Cumulative Percentage
   of the Date of Grant           Exercisable                Exercisable
--------------------------------------------------------------------------------
          First
--------------------------------------------------------------------------------
          Second
--------------------------------------------------------------------------------
          Third
--------------------------------------------------------------------------------
          Fourth
--------------------------------------------------------------------------------

                                    -6-
                                                                  Page 35 of 35