SECURITIES AND EXCHANGE COMMISSION
                          WASHINGTON, D.C. 20549

                                 FORM 8-K

                              CURRENT REPORT

  Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

     Date of Report (Date of earliest event reported): March 1, 2000

                       HITOX CORPORATION OF AMERICA
          (Exact name of registrant as specified in its charter)

                                 Delaware
               (State or other jurisdiction of corporation)

                                  0-17321
                         (Commission File Number)

                                74-2081929
                   (I.R.S. Employer Identification No.)

                               722 Burleson
                           Corpus Christi, Texas
                 (Address of principal executive offices)

                                   78402
                                (Zip Code)

    Registrant's telephone number, including area code: (361) 882-5175

                                 --------
       (Former name or former address, if changed since last report)


<PAGE>                                1

Item 2.  Acquisition or Disposition of Assets

     On  March  6,  2000,  Hitox  Corporation of  America  (the  "Company")
announced the purchase of Malaysian Titanium Corporation Sdn. Bhd. ("MTC"),
a  private  Malaysian  company.   The  sale  and  purchase  agreement  (the
"Agreement")  was signed in Malaysia effective March 1, 2000, and  provided
for the purchase by the Company of all of the issued and outstanding shares
of  MTC from  Megamin Ventures Sdn. Bhd. ("Megamin").  Megamin is also  the
Company's largest shareholder, with approximately 28% of the Company's out-
standing shares as of December 31, 1999. After giving effect to the Agreement,
Megamin  owns approximately 35% of the Company's outstanding shares  as  of
March  1, 2000.  Prior to the Agreement, Megamin had one appointee  to  the
Company's Board of Directors.  Per the Agreement, the Company will nominate
an  additional  person to serve on the Company's Board of  Directors  as  a
representative of Megamin.

     Pursuant to the terms of the Agreement, the Company paid $3,775,000 in
cash and issued 500,000 shares of its common stock in exchange  for 100% of
the shares of MTC.  The Company's shares closed  at $2.00 on  the effective
date of the Agreement.  The Company also agreed to pay  Megamin  a total of
approximately $1,050,000 in four equal semi-annual  payments beginning July
1, 2000.  The discounted  present value of those  payments is approximately
$950,000.  Transaction costs are estimated to total $150,000.   The Company
will record the  transaction as a  purchase, with  a  cost of approximately
$5,875,000, plus assumption of MTC's bank debt of approximately $4,000,000.

     The  cash payment of $3,775,000 was financed through a term loan  (the
"Bank  Loan") with Bank of America, N.A., (the "Bank").  The term loan  has
an initial principal balance of $3,500,000 and is to be repaid in full in a
single payment on October 5, 2001.  The Company may prepay all or a part of
the  principal  outstanding at any time without  penalty,  subject  to  any
restrictions caused by the choice of interest rate.  The interest  rate  is
the Bank's prime rate or the LIBOR rate plus 225 basis points, as chosen by
the  Company.   The  LIBOR based rate is available in  30,  60  or  90  day
tranches,  with a minimum of $1,000,000 for any one tranche.   If  a  LIBOR
based rate is used the Company cannot prepay any principal related to  that
tranche for the period chosen without paying a penalty.  The Company  chose
to  use the 90 day LIBOR tranche for the first interest rate for the entire
$3,500,000 principal balance, with an interest rate of 8.36% per annum.

     MTC  is  the  Company's  sole supplier of Synthetic  Rutile,  the  raw
material  for the Company's proprietary titanium pigment HITOX  (Registered
Trademark).  MTC is also producing HITOX pigment in Malaysia under a license
from the Company and is selling HITOX pigment in Asia and Europe.

<PAGE>                                2


     MTC  was previously a  subsidiary of Hitox Corporation  and was sold
to Megamin  and  other  investors in  1994.  The acquisition provides the
opportunity to control the raw material supply for the Company's  primary
product, HITOX pigment, and represents both a  low  cost production  site
for HITOX pigment and marketing opportunities outside the U.S. market.

Item 7.  Financial Statements and Exhibits

        (a)  Financial statements are not available, but will be  filed  as
             soon as practicable, but not later than 60 days after the  due
             date of this report.

        (b)  Pro forma financial information is not available, but will  be
             filed as soon as practicable, but not later than 60 days after
             the due date of this report.


        (c)  Exhibits

        Exhibit  No.
        ------------

             2.1     Purchase and  Sale agreement  effective March 1, 2000
                     between  Hitox  Corporation  of  America  and Megamin
                     Ventures  Sdn. Bhd.  The  schedules  to the agreement
                     are as follows and have been omitted from this filing
                     in accordance with Item 601(2) of Regulation S-B, but
                     will be provided to the Commission upon request.

                      (1st) Approval for the sale and purchase of Shares
                            granted by the Ministry of International
                            Trade and Industry of Malaysia

                      (2nd) Audited Financial Statements for the twelve
                            month period ended June 30, 1999

                      (3rd) Audited Financial Statements for the six
                            month period ended December 31, 1999.

             10.1    Third amendment to the loan agreement with Bank of
                     America dated March 3, 2000.

             99.1    Form of press release dated March 6, 2000,
                     announcing the purchase of MTC by Hitox

<PAGE>                                3

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                            Hitox Corporation of America
                                                   (Registrant)

Date: March 16, 2000                               CRAIG SCHKADE
                                                   -------------
                                                   Craig Schkade
                                              Chief Financial Officer
                                                   and Treasurer

<PAGE>                                4

                                                                Exhibit 2.1


                     DATED THIS 1st DAY OF MARCH 2000


                                  BETWEEN


                         MEGAMIN VENTURES SDN BHD
                              ("The Vendor")


                                    AND


                       HITOX CORPORATION OF AMERICA
                             ("The Purchaser")


                   ************************************

                        SALE AND PURCHASE AGREEMENT
                                 (SHARES)

                   ************************************


                         Messrs Chan & Associates
                          Advocates & Solicitors
                     Standard Chartered Bank Chambers
                    No 21-27, Jalan Dato Maharaja Lela
                             30000 Ipoh, Perak

<PAGE>                                5

THIS SALE AND PURCHASE AGREEMENT is made this 1st  day of March 2000


Between:-


MEGAMIN VENTURES SDN BHD (20827-A), a company incorporated in Malaysia with
its  registered office at No 41, Jalan Sultan Azlan Shah Utara, 31400 Ipoh,
Perak (hereinafter called "the Vendor") of the one part;


And


HITOX  CORPORATION OF AMERICA, a company incorporated in  Delaware,  United
States  of  America with its place of business at No 722, Burleson  Street,
Corpus  Christi, Texas 78402, United States of America (hereinafter  called
"the Purchaser") of the other part.


WHEREAS:-


(A) MALAYSIAN   TITANIUM  CORPORATION  SDN  BHD  (14387-W)  is  a   company
     incorporated  in Malaysia with its registered office at  4  1/2  Mile,
     Jalan  Lahat,  30200  Ipoh, Perak (hereinafter  referred  to  as  "the
     Company"),   carries  on  the  principal  business  of   manufacturing
     synthetic  rutile  and  is  in possession of a  manufacturing  licence
     issued by the Ministry of International Trade and Industry of Malaysia
     (hereinafter referred to as "MITI").

(B)  The  Company has an authorised share capital of Ringgit Malaysia Sixty
     Million  (RM60,000,000.00)  divided into  Sixty  Million  (60,000,000)
     ordinary  shares  of Ringgit One (RM1.00) each of  which  Twenty  Four
     Million One Hundred and Thirty Thousand (24,130,000) have been  issued
     and fully paid up or credited as fully paid up.

(C)  The Vendor is the registered owner of Twelve Million Seven Hundred and
     Fifty  Thousand (12,750,000) ordinary shares and the beneficial  owner
     of  Eleven  Million  Three  Hundred and Eighty  Thousand  (11,380,000)
     ordinary  shares  (all  Twenty Four Million  One  Hundred  and  Thirty
     Thousand (24,130,000) shares shall hereinafter be referred to as  "the
     said Shares").

(D)  The  Vendor and the Purchaser had on 1st January 2000 entered  into  a
     Memorandum  of Understanding (hereinafter referred to as "MOU")  which
     sets out the framework and the principal terms and conditions for  the
     sale and purchase of the said Shares between the parties.

<PAGE>                                6

(E)  Pursuant to the terms of the MOU, the Purchaser had carried out  legal
     and  financial  due  diligence  on the  Company,  undertaken  a  plant
     inspection and have been furnished a copy of the audited accounts  for
     the  financial  year ended 30th June 1999 and for the six  (6)  months
     ended  31st  December  1999 by Kassim Chan & Co.  (a  member  firm  of
     Deloitte Touche Tohmatsu International).

(F)  The Vendor has agreed to sell and the Purchaser has agreed to purchase
     the  said  Shares  for  the  consideration  and  upon  the  terms  and
     conditions hereinafter contained.



NOW THIS AGREEMENT WITNESSETH as follows:-


1.   AGREEMENT

     Subject  to the provisions stipulated herein, the Vendor as legal  and
     beneficial  owner of the said Shares hereby agrees  to  sell  and  the
     Purchaser to purchase the said Shares, free from all claims,  damages,
     liens,  charges and encumbrances for the consideration  and  upon  the
     terms and conditions hereinafter contained.


2.   PURCHASE PRICE

     The  Purchase Price for the said Shares is United States Dollars  Five
     Million   One  Hundred  and  Fifty  Thousand  (US$5,150,000.00)   only
     (hereinafter referred to as "the Purchase Price") which is  calculated
     based on USc21.343 per share.


3.   APPROVAL BY GOVERNMENT AUTHORITY

     The  Company operates under a manufacturing licence issued by MITI and
     as such had submitted an application to MITI for approval for a change
     in  shareholding of the Company. By letter dated 18th  February  2000,
     approval for the sale and purchase of the said Shares has been granted
     by  MITI  without any conditions attached, a copy of which is  annexed
     hereto as the First Schedule.


4.   MANNER OF PAYMENT OF PURCHASE PRICE

     4.1   The Purchase Price shall be paid by the Purchaser partly in cash
     and  partly  by way of shares in Hitox common stocks in the  following
     manner:-

<PAGE>                                7

     (a)  the  sum of United States Dollars Three Million Seven Hundred and
          Seventy Five Thousand (US$3,775,000.00) (hereinafter referred  to
          as "the Cash Payment") shall be paid to MESSRS CHAN & ASSOCIATES,
          Advocates  &  Solicitors  of 2nd Floor, Standard  Chartered  Bank
          Chambers,  No 21-27, Jalan Dato Maharaja Lela, 31400 Ipoh,  Perak
          (hereinafter  referred  to as "the Stakeholder")  as  stakeholder
          upon the execution of this Agreement; and

     (b)  the  balance  sum  of  United States Dollars  One  Million  Three
          Hundred and Seventy Fifty Thousand (US$1,375,000.00) (hereinafter
          referred to as "the Balance Purchase Price") shall be paid by way
          of  500,000  shares in Hitox common stocks valued at US$2.75  per
          share (hereinafter referred to as "the 500,000 Hitox shares").

     (c)  the  Purchaser  shall  deliver the 500,000 Hitox  shares  to  the
          Stakeholder together with the Cash Payment upon the execution  of
          this Agreement.

     (d)  the  Vendor  agrees  and acknowledges that it  is  acquiring  the
          500,000  Hitox shares for the sole purpose of investment and  not
          with  a  view  to,  or for offer or sale in connection  with  any
          distribution thereof. The Vendor acknowledges receipt  of  copies
          of   the  Purchaser's  current  10K  and  10Q  filings  with  the
          Securities  and Exchange Commission and that it is  knowledgeable
          about  investments  in  general and  about  the  affairs  of  the
          Purchaser in particular. The Vendor acknowledges that the 500,000
          Hitox shares have not been registered under the Securities Act of
          1933,  as  amended, and as such, the 500,000 Hitox  shares  shall
          constitute "restricted securities" within the meaning of Rule 144
          under that Act.

4.2    The  date  of  full  payment of the Balance Purchase  Price  by  the
     Purchaser shall be known as "the Completion Date".


5.   DELIVERY OF SHARE CERTIFICATES, MEMORANDA OF TRANSFER, ETC

5.1  Upon  execution of this Agreement, the Vendor shall deposit  with  the
     Stakeholder  the  shares  certificates  for  Seventeen  Million  Seven
     Hundred   and   Fifty   Thousand  (17,750,000)   shares   representing
     approximately Seventy Three Point Five Six percentum (73.56%)  of  the
     said  Shares  together  with  their  respective  transfer  forms  duly
     executed in favour of the Purchaser.


<PAGE>                                8

5.2  The  share certificates and the duly executed transfer forms  for  the
     balance  Six  Million  Three Hundred and Eighty Thousand   (6,380,000)
     shares  representing  the  remaining  Twenty  Six   Point  Four   Four
     percentum (26.44%) of the said Shares shall be deposited by the Vendor
     with the Stakeholder on or before 31st March 2000.

5.3  The parties have agreed that the Stakeholder shall:-

     (a)  release  the shares certificates and transfer forms for Seventeen
          Million   Seven   Hundred  Fifty  Thousand  (17,750,000)   shares
          representing approximately Seventy Three Point Five Six percentum
          (73.56%) of the said Shares to the Purchaser simultaneously  with
          the release of the Cash Payment by the Stakeholder to the Vendor;
          and

     (b)  hold  the  share  certificates and the  transfer  forms  for  the
          balance Six Million Three Hundred and Eighty Thousand (6,380,000)
          shares  representing  the remaining Twenty Six  Point  Four  Four
          percentum (26.44%) of the said Shares and to release the same  to
          the  Purchaser  simultaneously with the release  of  the  500,000
          Hitox shares to the Vendor.


6.   BOARD OF DIRECTORS

6.1  Upon  receipt of the Cash Payment, the parties hereto agree  that  the
     Purchaser shall have majority control of the board of directors and on
     the Completion Date, the Purchaser shall have exclusive control of the
     board of directors of the Company.

6.2  To  give effect to the provision in Clause 6.1 above, the Vendor shall
     cause  its  nominees  to  deliver to the  Purchaser  their  respective
     letters  of  resignation  as directors from their  respective  offices
     together with their acknowledgements and confirmation that they do not
     have any claims for damages and compensation against the Company.


7.   REPRESENTATIONS, WARRANTIES AND COVENANTS BY THE VENDOR

7.1  The   Vendor  hereby  represents,  warrants  and  covenants  with  the
     Purchaser that:-

     (a)  the  Vendor has the power and authority to enter into and execute
          this  Agreement to sell the said Shares to the Purchaser and this
          Agreement constitutes a legally binding obligation on the  Vendor
          enforceable  against  it  in accordance  with  the  terms  herein
          contained;


<PAGE>                                9

     (b)  the  Company  is  a private limited company duly established  and
          validly  existing under the laws of Malaysia and has  full  power
          and  authority  to own and use it properties and  assets  and  to
          carry  on its business as is now being conducted and has obtained
          all  licences and governmental approvals necessary to operate its
          business;

     (c)  the  Company's Memorandum and Articles of Association are in  the
          form of the document signed by or on behalf of the Vendor, a copy
          of  which  has been delivered to the Purchaser and no resolutions
          have  been  or  will  be  passed  effecting  alterations  to  the
          Memorandum and Articles of Association;

     (d)  the  authorised  and issued share capital of the Company  are  as
          stated  in  Recital (B) above and the Company has not  since  the
          date  of  its incorporation issued or agreed to issue any  shares
          (other  than  the aforesaid issued Ordinary Shares) or  given  or
          agreed  to  give any option in respect of any shares nor  of  any
          debenture  or  other securities nor will the  Company  issue  any
          debenture  or  rights  to purchase or subscribe  for  any  shares
          without  the prior consent in writing by the Purchaser after  the
          date of this Agreement;

     (e)  the audited accounts and the balance sheet of the Company for the
          financial period ended 30th June 1999, a copy of which is annexed
          hereto  as the Second Schedule (hereinafter referred to  as  "the
          Existing Accounts") and the audited accounts of the  Company  for
          the six (6) months ended 31st December 1999,  a copy of  which is
          annexed hereto as the Third Schedule  (hereinafter referred to as
          "the Updated Accounts") give a true and fair view of the financial
          position of the Company as at those dates;

     (f)  the  Company  has  not  entered into any long  term  or  abnormal
          contract or undertaken any obligation whatsoever except  such  as
          are  usual and necessary in the ordinary and proper course of its
          business  and  which do not impose any burdensome obligations  on
          the  Company  or as are referred to in the Existing Accounts  and
          the Updated Accounts;

     (g)  the  Company has good and indefeasible title to all of its assets
          free  and clear of all liens and encumbrances except as shown  in
          the Updated Accounts and as disclosed by the Vendor in writing to
          the  Purchaser  and  the Company has conducted  its  business  in
          compliance with all laws rules and regulations;


<PAGE>                                10

     (h)  all  assets of the Company held under lease are held under  valid
          and  enforceable  leases and the Company  has  not  received  any
          notice  from any lessor of the Company's non-compliance with  any
          lease obligation, and the Company is in compliance with the terms
          and  conditions of all agreements to which it is a party and  has
          received no notice from any party asserting the existence of  any
          breach  thereof  by  the Company nor any outstanding  notices  in
          respect of any of its properties or assets;

     (i)  there  are  not  in  existence  any  contracts  of  service  with
          directors or employees of the Company or any retirement scheme or
          policy  for  its  employees  or any consultancy  agreements  with
          anyone  which  cannot be terminated by the Company by  three  (3)
          months'  notice  or  less or (where not reduced  to  writing)  by
          reasonable notice without giving rise to any claim for damages or
          compensation  (other  than  a  statutory  redundancy  payment  or
          statutory compensation for unfair dismissal);

     (j)  the  Company  has  no  outstanding  debts,  claims,  liabilities,
          contracts or engagements otherwise than in the ordinary course of
          its  business or as disclosed in the Existing Accounts or Updated
          Accounts period or in writing to the Purchaser;

     (k)  no  part of the amounts included in the Existing Accounts  or  in
          the books of the Company as due from debtors has been released on
          terms  that any debtor pays less than the book value of his  debt
          as  at  31st December 1999 (hereinafter referred to as "the  Said
          Date") or has been written off;

     (l)  the Company  has  not  since  the  Said  Date  entered  into  any
          substantial capital transaction other than in the ordinary course
          of  business either as vendor or purchaser, nor entered into  any
          material  commitments nor undertaken any material obligations  or
          incurred any material capital expenditure;

     (m)  returns, particulars, resolutions and other documents required to
          be  delivered  by the Company to the Registrar of Companies  have
          been properly, correctly and duly delivered to such Registrar;

     (n)  there  has been no substantial increase in any fees or emoluments
          paid  or  payable to any officer or servant of the Company  since
          the Said Date;


<PAGE>                                11

     (o)  the  tax  returns of the Company have at all times been  correct,
          made on a proper basis and not the subject of any back duty claim
          or  dispute with the revenue authorities, and the provisions  for
          taxation  up  to  the Said Date in the Existing Accounts  of  the
          Company is sufficient to cover all taxation (whether income  tax,
          surtax,  profits  tax, excess profits tax, excess  profits  levy,
          special  contribution or real property gains  tax  or  any  other
          taxes,   charges  and  impositions  relevant  to  the   Company's
          business) for which the Company was at the Said Date or any  time
          thereafter may have become liable to be assessed or to pay;

     (p)  save as otherwise disclosed herein, the Company has not since the
          Said  Date paid or made and will not pending completion hereunder
          pay  or  make any dividend or other distribution, loan or advance
          to any person, firm or company;

     (q)  the  Company  does not use its letterheads, books or vehicles  or
          otherwise  carry  in  business under  any  name  other  than  its
          corporate name;

     (r)  the  Company  is  not  engaged in any litigation  or  arbitration
          proceedings  nor  is the Vendor aware of any circumstances  which
          may  give  rise  to  any  litigation or  arbitration  proceedings
          against the Company except as disclosed to the Purchaser;

     (s)  the Company has effected and maintained all permits, licences and
          insurance  necessary and proper to be effected and maintained  by
          reason of the nature of the business carried on and has duly paid
          all  fees  and  premia in respect thereof and all  such  permits,
          licences  and  insurance are now in force  and  not  voidable  on
          account  of any act or omission or non-disclosure on the part  of
          the Company and there is no breach of any terms and conditions of
          any  such  permits,  licences  or insurance  which  may  lead  to
          avoidance  or  revocation of such permits, licences or  insurance
          and the making and implementation of this Agreement will not lead
          to   avoidance  or  revocation  of  such  permits,  licences   or
          insurance;

     (t)  the  Company has not since the Said Date acquired any  assets  on
          hire  purchase  or deferred terms or entered into  any  equipment
          leasing arrangements;

     (u)  the  Company has not since the Said Date knowingly permitted  any
          liens  to  arise  on  any  of its assets nor  sold,  transferred,
          disposed  of,  assigned, dealt with or parted with possession  of
          its assets or any part thereof,

<PAGE>                                12

     PROVIDED ALWAYS THAT the Vendor shall not be held responsible for  any
     matters  which occurred prior to it assuming control of the management
     of the Company from 1st January 1995.

7.2  The Vendor further covenants with the Purchaser as follows:-

     (a)  that  the  Vendor shall not directly or indirectly,  without  the
          consent  in  writing of the Purchaser, carry on or be engaged  in
          any  business  similar  to  or in competition  with  the  present
          business undertaken by the Company for a period of five (5) years
          from the date of execution of this Agreement;

     (b)  that  the Vendor shall not for the period of five (5) years  from
          the  date of execution of this Agreement hire or employ  six  (6)
          employees  of  the  Company to be named by the  Purchaser  within
          seven (7) days from the date of this Agreement;


8.   REPRESENTATIONS, WARRANTIES AND COVENANTS BY THE PURCHASER

8.1  The  Purchaser  hereby  represents, warrants and  covenants  with  the
     Vendor that:-

     (a)  the  Purchaser  is a public listed company duly  incorporated  in
          Delaware and validly existing under the laws of the United States
          of America;

     (b)  the  Purchaser  has  the power and authority to  enter  into  and
          execute this Agreement to acquire the said Shares from the Vendor
          and  this  Agreement constitutes a legally binding obligation  on
          the Purchaser enforceable against it in accordance with the terms
          herein contained;

     (c)  the  Purchaser has obtained all necessary approvals (governmental
          and/or otherwise) to enter into this Agreement.

8.2  The Purchaser further covenants with the Vendor as follows:-

     (a)  the  Purchaser shall use their best endeavours to appoint Mr  Lim
          Si  Boon  to  the  board of directors of the Purchaser  upon  the
          execution of this Agreement;

     (b) the Purchaser acknowledges that Harpers Trading Sdn Bhd (Harpers),
          a subsidiary of the Vendor, has been the purchasing agent for the
          Company.  In  consideration of Harpers  agreeing  to  voluntarily
          terminate  the  said agency and a covenant by the Vendor  not  to
          compete with the Company for the period of 5 years


<PAGE>                                13

          from  the  date  of this agreement, the Purchaser  undertakes  to
          procure  that the Company shall compensate the Vendor  a  sum  of
          RM4,000,000.00  payable in 4 equal instalments of  RM1,000,000.00
          each  every 6 months starting 1st July 2000. The Purchaser agrees
          to use its best endeavors to pay the amount due in advance if the
          Company's cash flow permits.


9.   MUTUAL COVENANTS

     The parties  agree that the currency used for purposes of the sale and
     purchase  of the said Shares under this Agreement shall be  in  United
     States Dollars (US$).


10.  LIABILITY FOR TAX ON DISPOSAL

     The Vendor hereby undertakes to bear and pay all taxes (if any) on the
     disposal  of  the  said  Shares  and shall  keep  the  Purchaser,  its
     successors in title and permitted assigns and each of them indemnified
     in respect thereof.


11.  DEFAULT BY THE VENDOR

11.1 If  the Vendor fails to deposit the share certificates as described in
     Clause 5.2 above the Vendor is entitled to an extension of 30 days.

11.2 In the event that after the extension of 30 days, the Vendor is unable
     to deliver all the remaining shares, the Purchaser shall be obliged to
     accept  the  amount so delivered and this inability by the  Vendor  to
     deliver  shall not constitute a breach on the part of the  Vendor  and
     the Purchaser is deemed to have paid the balance of the purchase price
     in  accordance  with  Clause 4.1(a) above and  the  Stakeholder  shall
     return the 500,000 Hitox shares to the Purchaser.

11.3 Notwithstanding  the above, at any time when the  Vendor  is  able  to
     obtain the remaining undelivered shares, the Vendor shall first  offer
     such  shares to the Purchaser in exchange for the 500,000 Hitox shares
     or  for  a  cash  payment of United States Dollars One  Million  Three
     Hundred  and  Seventy Five Thousand (US$1,375,000.00).  The  Purchaser
     shall have the right to accept or refuse such late delivery of shares.

12.  INTERPRETATION

12.1 The  headings in this Agreement are inserted for convenience only  and
     shall  not  be  taken, read or construed as essential  parts  of  this
     Agreement.

<PAGE>                                14

12.2 Words  importing the masculine gender shall include the  feminine  and
     neuter  gender  and  vice versa. Words importing the  singular  number
     shall include the plural number and vice versa.

12.3 Where two or more persons or parties are included or comprised in  any
     expression,    agreements,   covenants,   terms,   stipulations    and
     undertakings expressed to be made to such persons shall be enforceable
     by  such  persons  or  parties jointly and severally  and  agreements,
     covenants, terms, stipulations and undertakings expressed to  be  made
     by  or  on the part of such persons or parties shall be deemed  to  be
     made  by  and  binding  upon  such  persons  or  parties  jointly  and
     severally.


13.  GENERAL

13.1 Time shall be of the essence of this Agreement.

13.2 The  invalidity or unenforceability of any term or provision  of  this
     Agreement shall not affect the validity or enforceability of the other
     terms and provisions herein contained which shall remain in full force
     and effect PROVIDED THAT such invalidity or unenforceability shall not
     substantially  nullify  the underlying intent of  this  Agreement  AND
     PROVIDED  THAT  the  invalid  or  unenforceable  provision  shall   be
     severable.

13.3 Any waiver by either party or a breach of any terms and conditions  of
     this  Agreement shall not constitute a waiver of any subsequent breach
     of  the  same  terms and conditions or any other term or condition  of
     this Agreement.

13.4 This  Agreement shall be governed by and construed in English  and  in
     accordance with the laws of Malaysia.

13.5 Any notice required to be served on the parties hereto shall be served
     personally or sent by prepaid registered post and any notice  required
     to be served shall be sufficiently served if served personally or left
     at  the  addresses above stated and any notice sent by post  shall  be
     deemed to have been given at the time when it ought to be delivered in
     due course in the post.

13.6 The  Purchaser  shall  bear  the costs of  stamp  duty  (if  any)  and
     registration  fees (if any) chargeable in respect of the  transfer  of
     the said Shares. Each party shall bear its own solicitors' cost.

13.7 This  Agreement shall be binding upon the respective permitted assigns
     and successors-in-title of the parties hereto.

                             ****************
<PAGE>                                15

     IN  WITNESS  WHEREOF the parties hereto have hereunto set their  hands
the day and year first above written.



The Vendor

Signed by Dato Lim Keng Kay   )              KENG KAY LIM
for and on behalf of          )          --------------------
MEGAMIN VENTURES SDN BHD      )              Keng Kay Lim
(20827-A) in the presence of:-)



The Purchaser

Signed by Bernard A. Paulson  )           BERNARD A. PAULSON
for and on behalf of          )          --------------------
HITOX CORPORATION OF AMERICA  )           Bernard A. Paulson
in the presence of:-          )


<PAGE>                                16

                                                               Exhibit 10.1


                     THIRD AMENDMENT TO LOAN AGREEMENT


     This  is  a  Third  Amendment to a Loan Agreement by and  among  HITOX
CORPORATION OF AMERICA, INC., a Delaware corporation ("Borrower") and  BANK
OF  AMERICA, N.A., a national banking association which is the successor in
interest by merger to NationsBank of Texas, N.A. ("Bank").

     Borrower has entered into a Loan Agreement with Bank dated August  31,
1995,  which has been amended by a First Amendment to Loan Agreement  dated
July  31, 1996 and a Second Amendment to Loan Agreement dated July 17, 1998
(as  amended,  the  "Loan Agreement").  Words which are capitalized  herein
which are defined in the Loan Agreement shall have the same meanings as  in
the  Loan  Agreement.  Borrower has requested Bank to lend it an additional
$3,500,000,  which  Bank is willing to do on the terms and  conditions  set
forth herein.

     NOW, THEREFORE, for valuable consideration, Borrower and Bank mutually
agree that the Loan Agreement shall be, and is hereby, amended as follows:

     AMENDMENT TO SECTION I.  Section I of the Loan Agreement is amended in
its entirety to read as follows:

          1.1     REVOLVING  LINE  OF  CREDIT.   Bank  has  established   a
     revolving line of credit for loans to be made to Borrower and  letters
     of  credit  to be issued at the request of Borrower which is evidenced
     by  the  promissory note maturing April 30, 2000 which is attached  as
     Exhibit   A,  to  which  reference  is  here  made  for  all  purposes
     ("Revolving  Note").   The total amount of all loans  and  letters  of
     credit  outstanding under the Revolving Note may  vary  from  time  to
     time, but shall not exceed in the aggregate at any one time the lesser
     of   (a)  $2,000,000  or  (b)  80%  of  Borrower's  Eligible  Accounts
     Receivable.   For  purposes  of  this  calculation  only,   Borrower's
     "Eligible  Accounts  Receivable" shall mean those accounts  receivable
     for  services  actually  performed  and/or  goods  actually  sold  and
     delivered,  which are invoiced and owing to Borrower, other  than  (1)
     receivables   from   Borrower's   officers,   directors,    employees,
     stockholders or affiliates, (2) receivables that are subject to offset
     or  credit,  (3) receivables from customers which Bank has determined,
     in  its sole discretion, not to be credit-worthy, (4) receivables that
     are  contingent or are disputed by customers, and (5) receivables from
     customers where at least 10% of one or more invoices is more  than  60
     days past the date of original invoice (or 120 days if the invoice  is
     secured by a letter of credit).

<PAGE>                                17

          1.2.    BORROWING BASE COMPLIANCE.  Borrower agrees to deliver to
     Bank  a Borrowing Base Certificate in the form attached as Exhibit  B,
     stating the information set forth therein as of the date thereof,  (a)
     upon each request for an advance on the Revolving Note and (b) 20 days
     after  the end of each month, showing the information as of  the  last
     day  of  the  preceding  month.  If the  total  amount  of  all  loans
     (including  any  letter of credit obligations) outstanding  under  the
     Revolving Note exceeds the amount authorized, Borrower agrees that  it
     will  promptly  (1)  pay  Bank  an amount  sufficient  to  reduce  the
     outstanding balance on the Revolving Note to an amount which does  not
     exceed the authorized amount, or (2) increase the amount of assets  in
     the Borrowing Base calculation to the extent necessary to increase the
     authorized  amount above the total aggregate amount of all  loans  and
     letter  of credit obligations outstanding under the Revolving Note  at
     such time.

          1.3.     LETTER OF CREDIT OBLIGATIONS.  Bank agrees to issue  its
     irrevocable  standby  letters of credit under the  Revolving  Note  as
     requested  by Borrower, for a fee of 2.0% of the amount of the  credit
     per  annum, with a minimum charge of $300 plus Bank's standard charges
     for  amendments, telex, document against said letters of credit  shall
     be  considered as loans for all purposes under the Revolving Note from
     and after the date of issuance.

          1.4.     REVOLVING  LOAN  COMMITMENT FEE.  In  consideration  for
     Bank's commitment to maintain $2,000,000 available for advances  under
     the  Revolving Note, Borrower agrees to pay Bank a Commitment  Fee  of
     0.25%  per  annum on the difference between the Requested Availability
     Amount  and  the  average amount of the advances  (including  unfunded
     letter  of  credit  obligations) made during  the  preceding  quarter,
     calculated and invoiced to Borrower following each March 31, June  30,
     September  30  and  December 31, which shall be due and  payable  upon
     receipt.   Borrower's  Requested  Availability  Amount  shall  be  (a)
     $2,000,000 or (b) if such a letter is given, any lesser amount  stated
     by  Borrower  in letter delivered to Bank at least ten days  prior  to
     each  March 31, June 30, September 30 or December 31 stating a maximum
     amount  to  be  available  for  loans and  letters  of  credit  to  be
     outstanding  under  the  Revolving Note  during  the  next  succeeding
     quarter  and,  until  a  subsequent letter is  given,  all  successive
     quarters  thereafter.  Borrower shall not be entitled to borrow  funds
     or  obtain  letters  of credit which, with all previously  outstanding
     loans  and  letters  of credit outstanding at that  time,  exceed  the
     Requested   Availability  Amount  as  so  designated.   The  Requested
     Availability Amount may be increased by Borrower during such  quarter,
     but  in that event the Commitment Fee shall be calculated on the basis
     of  the  higher  Requested Availability Amount for the entire  quarter
     times 110%.

<PAGE>                                18

          1.5.     TERM  LOAN.  Bank agrees to lend  Borrower  the  sum  of
     $3,500,000, which shall be evidenced by the promissory note  which  is
     attached  as  Exhibit  C, to which reference  is  here  made  for  all
     purposes  ("Term Note").  Notwithstanding paragraph 2  of  the  Second
     Amendment  to  Loan  Agreement, the Term Note and the  Revolving  Note
     shall be secured by the collateral described in Section II of the Loan
     Agreement.

          1.6.     TERM  LOAN COMMITMENT FEE.  In consideration for  Bank's
     commitment  to  make the Term Loan to Borrower to enable  Borrower  to
     purchase  the  Malaysian Titanium Corporation or its assets,  Borrower
     agrees to pay Bank a commitment fee of $8,750 at closing.

          1.7.    LOANS.  The provisions of this Loan Agreement shall apply
     to  the  Revolving  Note  and the Term Note,  to  any  extensions  and
     renewals thereof, and to any other loans which may hereafter  be  made
     to  Borrower  by  Bank.  Said loans (including the  letter  of  credit
     obligations)  are  collectively  referred  to  as  "Loans",  and  each
     separately  as  a  "Loan",  herein.  The promissory  notes  which  are
     attached  as  Exhibits  A and C and all other  promissory  notes  from
     Borrower  to  Bank are collectively referred to as "Notes",  and  each
     separately as a "Note", herein.

          1.8.     NO OBLIGATION TO RENEW.  Bank shall not be obligated  to
     renew  or  extend the time for payment of any Note beyond the maturity
     date  stated therein.  If a Note is not renewed at maturity,  Borrower
     will be required to pay the obligation out of other assets, or will be
     required to find another lender who is willing to refinance the  debt.
     Any  refinancing will be at the then prevailing market rate, which may
     be  higher than the current rate.  Also, there is no guaranty that the
     obligation can be refinanced on any basis.  If a Note is refinanced or
     renewed,  Borrower  may  also be required to  pay  additional  closing
     costs,  or  be  required  to provide additional  collateral  and/or  a
     current  appraisal, survey, title policy or other supporting  data  on
     the existing Collateral.

     2.    Deletion of Paragraph 2.1.  Paragraph 2.1 of the Loan  Agreement
is amended to delete subparagraph 2.1(b) in its entirety.

     3.    Amendment to Paragraph 4.3.  Paragraph 4.3 of the Loan Agreement
is amended to read as follows:


<PAGE>                                19

          4.3   ANNUAL  FINANCIAL STATEMENTS.  Borrower agrees  to  furnish
     Bank, (a) within 120 days after the close of each fiscal year, with  a
     copy of (i) Borrower's annual consolidated and consolidating financial
     statements,  audited by an independent certified public accountant  or
     accounting  firm selected by Borrower and satisfactory to Bank,  which
     financial statements shall include balance sheets as of the end of the
     year  and profit and loss statements reflecting operations during  the
     year,  including statements of financial condition, income, cash flows
     and  changes  in  shareholders' equity,  all  of  which  shall  be  in
     reasonable  detail  and  shall set forth comparable  figures  for  the
     preceding year, (ii) Borrower's annual report to its shareholders  and
     (iii)  the  independent  auditor's  letter  to  Borrower's  board   of
     directors,  (b)  within 60 days after the close of each  fiscal  year,
     with  copies  of Borrower's pro forma balance sheet, income  statement
     and  cash  flow statement for the next year, and (c) if  requested  by
     Bank,  with copies of their federal income tax returns within 10  days
     after filing the same.

     4.    Amendment to Paragraph 4.4.  Paragraph 4.4 of the Loan Agreement
is amended to read as follows:

          4.4.  Monthly  and Quarterly Financial Statements and  Compliance
     Certificates.  Borrower agrees to furnish Bank, within 30  days  after
     the  end of each month, with a copy of Borrower's monthly consolidated
     and consolidating financial statements, certified by the president  or
     chief  financial officer of Borrower, which financial statements shall
     include (a) balance sheets as of the end of the month, (b) profit  and
     loss  statements reflecting operations during the month, (c) a listing
     of  the  inventory in Borrower's possession at the end of  the  month,
     showing the product description, quantities and value at the lower  of
     cost or market and (d) an aged list of accounts receivable owed to Bor
     rower  at the end of the month.  In addition, Borrower also agrees  to
     furnish  Bank,  within  60  days after each  March  31,  June  30  and
     September  30, and within 90 days after each December 31, with  (i)  a
     Compliance  Certificate, completed and with supporting  data,  in  the
     form  which  is attached as Exhibit D, (ii) with a copy of  Borrower's
     quarterly report to its shareholders and (iii) a copy of Borrower's 10-
     Q  report  filed  with  the  Securities and Exchange  Commission.   In
     addition, Borrower further agrees to furnish Bank with copies of  each
     press  release  issued by Borrower, within 48 hours  of  the  date  of
     issue.

     5.    Amendment to Paragraph 4.5.  Paragraph 4.5 of the Loan Agreement
is amended to read as follows:


<PAGE>                                20

          4.5   NOTICE  OF  DEFAULT  OR  LITIGATION.   Borrower  agrees  to
     promptly  notify  Bank  in writing of (a) the institution  of  or  any
     adverse  determination in any litigation, arbitration or  governmental
     proceeding  filed  by or against Borrower, (b) the occurrence  of  any
     event  which  would  constitute an Event of Default  under  this  Loan
     Agreement, (c) any uninsured or partially uninsured loss through fire,
     theft,  liability or property damage, and (d) any condition, event  or
     act   that  would  or  might  adversely  affect  Borrower's  financial
     condition  to the extent of $250,000 or more or Borrower's operations,
     the  Collateral or Bank's rights under the Loan Agreement,  Notes,  or
     Security Documents, describing the same and the steps being taken with
     respect thereto.

     6.    Amendment  to  Paragraph  4.10.   Paragraph  4.10  of  the  Loan
Agreement is amended to read as follows:

          4.10.  ADDITIONAL  DEBT, CAPITAL ACQUISITIONS.   Borrower  agrees
     that it will not incur, assume, guaranty or become contingently liable
     for   the   payment  of  any  indebtedness  or  liability   (including
     capitalized leases), other than (a) the Loans, (b) open account  trade
     indebtednesses which are incurred in the ordinary course  of  business
     (which  shall be paid when due), (c) existing indebtednesses disclosed
     to  Bank in writing and acknowledged by Bank prior to the date hereof,
     and  (d)  tax  obligations (which shall be paid when  due).   Borrower
     agrees  that it will not expend any funds for capital acquisitions  in
     excess  of  $1,250,000 per year without the prior written approval  of
     Bank, whose consent shall not be unreasonably withheld.

     7.    Amendment  to  Paragraph  4.13.   Paragraph  4.13  of  the  Loan
Agreement is amended to read as follows:

          4.13. Loans to Entities; Guaranties.  Borrower agrees it will not
     (a)  lend  funds to any one or more persons or entities in  excess  of
     $1,000 per individual or (b) lend funds of more than $1,000,000 in the
     aggregate to Malaysian Titanium Corporation.  Borrower agrees that  it
     will  not  guarantee the payment or performance of any debt  or  other
     obligation of any subsidiary or any other entity.

     8.  Amendment to Paragraph 4.16.  Paragraph 4.16 of the Loan Agreement
is amended to read as follows:


<PAGE>                                21

          4.16.  Existence,  Compliance and Business Operations.   Borrower
     agrees  that  it  will  maintain  its  existence,  good  standing  and
     qualification  to  do  business,  and  will  comply  with  all   laws,
     regulations and governmental requirements applicable to it or  to  any
     of  its property, business operations and transactions, including  but
     not  limited  to  the Occupational Safety and Health Act  (OSHA),  the
     Employee  Retirement Income Security Act (ERISA) and the Environmental
     Protection  Act  (EPA).  Borrower agrees that it will not  change  the
     general  character  of business as conducted on the  date  hereof,  or
     engage  in any type of business not reasonably related to its business
     as presently conducted.

     9.    Amendments to Paragraphs 4.19, 4.20, and4.21.  Paragraphs  4.19,
420 and 4.21 of the Loan Agreement are amended to read as follows:

          4.19  RATIO  OF CURRENT ASSETS TO CURRENT LIABILITIES.   Borrower
     agrees  that  it  will maintain a ratio of current assets  to  current
     liabilities of not less than 2.5 to 1.0, on an unconsolidated basis.

          4.20  RATIO OF TOTAL DEBT TO TANGIBLE NET WORTH.  Borrower agrees
     that it will maintain a ratio of total debt tangible net worth, on  an
     unconsolidated basis, of not more than 2.5 to 1.0  on each  March  31,
     June  30,  September  30  and  December 31,.   For  purposes  of  this
     calculation,  Borrower's total debt shall mean all of its liabilities,
     and  Borrower's  tangible net worth shall mean  Borrower's  net  worth
     minus all intangible assets.

          4.21.   FUNDED  DEBT  COVERAGE.  Borrower  agrees  that  it  will
     maintain a funded debt coverage ratio, on an unconsolidated basis,  of
     no  greater than (a) 4.0 to 1.0 on March 31, 2000, (b) 3.0 to  one  on
     September  30, 2000, and (c) 1.5 to one on December 31,  2000  and  on
     each March 31, June 30, September 30 and December 31 thereafter, based
     on  the  four  immediately preceding quarters.  For purposes  of  this
     calculation, Borrower's funded debt coverage shall mean that ratio  of
     Borrower's  funded  debt to Borrower's cash flow.   Borrower's  funded
     debt  shall include the principal amount of all outstanding promissory
     notes and capital lease obligations.   Borrower's cash flow shall mean
     Borrower's  net  income  after taxes on a book  basis  (a)   plus  (i)
     interest expense, (ii) depreciation and amortization, (iii) other non-
     cash  expenses and (iv) lease expenses, (b) less gains on the sale  of
     assets and cash dividends.

     10.  Deletion of Paragraph 4.22.  Paragraph 4.22 of the Loan Agreement
is deleted in its entirety.


<PAGE>                                22

     11.   FINANCIAL STATEMENTS; LITIGATION.  Borrower represents  to  Bank
that all financial statements which have been furnished to Bank are correct
and  complete in all material respects, and fairly represent the  financial
condition  of  Borrower on the dates thereof or for the  periods  specified
therein, and that no material adverse change has occurred since the date of
the  latest  of  such  financial statements.   No  litigation,  arbitration
proceedings  or  governmental  or regulatory  proceedings  are  pending  or
threatened against Borrower which, if adversely determined, would be likely
to  adversely  affect  Borrower's  financial  condition  or  the  legality,
validity  or  enforceability  of  the Loan  Agreement,  Notes  or  Security
Documents.

     12.   PRIOR DOCUMENTS.  Borrower ratifies and confirms that all of the
representations  and  warranties, covenants, events of  default  and  other
provisions  of the Loan Agreement are true and correct and remain  in  full
force  and  effect, as of the date hereof.  Borrower further  ratifies  and
confirms that all of the Security Documents shall also remain in full force
and effect until the Notes are paid in full.

     13.   RELEASE.   For  valuable  consideration  received  to  the  full
satisfaction of Borrower, Borrower waives and releases any and  all  causes
of  action  against  Bank,  its  agents and employees,  for  all  acts  and
omissions  which have occurred prior to the signing of this Third Amendment
to  Loan  Agreement, including but not limited to all causes of action  for
claims    of   usury,   fraud,   deceit,   misrepresentation,   conspiracy,
unconscionability,   duress,   economic   duress,   defamation,    control,
interference   with   corporate  governance,  tortious  interference   with
contractual  and business relationships, conflicts of interest,  misuse  of
insider   information,   concealment,  disclosure,   secrecy,   misuse   of
collateral,   wrongful   release  of  collateral,   failure   to   inspect,
environmental  due diligence, negligent loan processing and administration,
wrongful  setoff,  violations of statutes and regulations  of  governmental
entities  and agencies (both civil and criminal), racketeering  activities,
security  and  antitrust  violations, tying arrangements,  deceptive  trade
practices (to the maximum extent permitted by law), and breach or abuse  of
any  alleged fiduciary duty, special relationship, course of conduct and/or
obligation of good faith and fair dealing.  Bank and Borrower further agree
that  the amount of their damages in all causes of action, including causes
of  action  arising after the date hereof, shall be limited to exclude  all
(i)  punitive  and  exemplary damages, (ii) damages  attributable  to  lost
profits  or  opportunity, (iii) damages attributable to mental anguish  and
(iv)  damages attributable to pain and suffering, and the parties do hereby
waive  and  release all such damages with respect to any and all causes  of
action  which  may arise at any time against any other party, their  agents
and employees.


<PAGE>                                23

     14.   ARBITRATION.   ANY  CONTROVERSY OR CLAIM BETWEEN  OR  AMONG  THE
PARTIES  HERETO  INCLUDING  BUT NOT LIMITED TO  THOSE  ARISING  OUT  OF  OR
RELATING  TO  THIS  INSTRUMENT,  AGREEMENT  OR  DOCUMENT  OR  ANY   RELATED
INSTRUMENTS,  AGREEMENTS OR DOCUMENTS, INCLUDING  ANY  CLAIM  BASED  ON  OR
ARISING FROM AN ALLEGED TORT, SHALL BE DETERMINED BY BINDING ARBITRATION IN
ACCORDANCE  WITH  THE  FEDERAL ARBITRATION ACT (OR IF NOT  APPLICABLE,  THE
APPLICABLE  STATE  LAW),  THE  RULES OF  PRACTICE  AND  PROCEDURE  FOR  THE
ARBITRATION  OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR ANY  SUCCESSOR
THEREOF  ("J.A.M.S."), AND THE "SPECIAL RULES" SET  FORTH  BELOW.   IN  THE
EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL.  JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION.  ANY
PARTY  TO  THIS  INSTRUMENT, AGREEMENT OR DOCUMENT  MAY  BRING  AN  ACTION,
INCLUDING A SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION  OF  ANY
CONTROVERSY  OR CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY  COURT  HAVING
JURISDICTION OVER SUCH ACTION.

          (1)   SPECIAL RULES.  THE ARBITRATION SHALL BE CONDUCTED  IN  THE
COUNTY  OF  ANY  BORROWER'S DOMICILE AT THE TIME OF THE EXECUTION  OF  THIS
INSTRUMENT,  AGREEMENT OR DOCUMENT AND ADMINISTERED BY  J.A.M.S.  WHO  WILL
APPOINT  AN  ARBITRATOR;  IF J.A.M.S. IS UNABLE OR LEGALLY  PRECLUDED  FROM
ADMINISTERING  THE  ARBITRATION, THEN THE AMERICAN ARBITRATION  ASSOCIATION
WILL  SERVE.  ALL ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90 DAYS  OF
THE  DEMAND  FOR ARBITRATION; FURTHER, THE ARBITRATOR SHALL  ONLY,  UPON  A
SHOWING  OF CAUSE, BE PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH  HEARING
FOR UP TO AN ADDITIONAL 60 DAYS.

          (2)    RESERVATION  OF  RIGHTS.   NOTHING  IN  THIS   ARBITRATION
PROVISION  SHALL BE DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY  OTHERWISE
APPLICABLE  STATUTES OF LIMITATION OR REPOSE AND ANY WAIVERS  CONTAINED  IN
THIS INSTRUMENT, AGREEMENT OR DOCUMENT; OR (II) BE A WAIVER BY BANK OF  THE
PROTECTION  AFFORDED  TO  IT  BY 12 U.S.C. SEC.  91  OR  ANY  SUBSTANTIALLY
EQUIVALENT  STATE  LAW;  OR (III) LIMIT THE RIGHT OF  BANK  HERETO  (A)  TO
EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED TO) SETOFF, OR (B)  TO
FORECLOSE  AGAINST  ANY  REAL OR PERSONAL PROPERTY COLLATERAL,  OR  (C)  TO
OBTAIN  FROM  A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH  AS  (BUT  NOT
LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT  OF  A
RECEIVER.   BANK  MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE  UPON  SUCH
PROPERTY,  OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE,  DURING
OR  AFTER  THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT  PURSUANT  TO
THIS INSTRUMENT, AGREEMENT OR DOCUMENT.  NEITHER THIS EXERCISE OF SELF HELP
REMEDIES NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR
PROVISIONAL OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF
ANY  PARTY,  INCLUDING THE CLAIMANT IN ANY SUCH ACTION,  TO  ARBITRATE  THE
MERITS OF THE CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.


<PAGE>                                24

     15.   COMPLETE AGREEMENT.  THE WRITTEN LOAN AGREEMENT AS AMENDED,  THE
NOTES  AND  ALL CURRENTLY AND PREVIOUSLY EXECUTED SECURITY DOCUMENTS  REPRE
SENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE  OF  PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS  OF  THE
PARTIES.

 THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

     Dated: March 3, 2000.

                                   BORROWER:

                                   HITOX CORPORATION OF AMERICA, INC.


                                   By:  RICHARD L. BOWERS
                                        -----------------
                                        Richard L. Bowers,
                                        Executive Vice President

                                   BANK:

                                   BANK OF AMERICA, N.A.



                                   By:  TOM L. HUNT
                                        -----------------
                                        Tom L. Hunt,
                                        Vice President


<PAGE>                                25

                              PROMISSORY NOTE

Date:  March 3, 2000                                  Amount $3,500,000

[X] New  [ ] Renewal                    Maturity Date:  October 5, 2001

Bank:                               Borrower:

Bank of America, N.A.               Hitox Corporation of America, Inc.
Corpus Christi Downtown             722 Burleson Street
500 North Shoreline Blvd.           Corpus Christi, Texas 78469
Nueces County
Corpus Christi, Texas  78471

FOR VALUE RECEIVED, the undersigned Borrower unconditionally (and jointly
and  severally, if more than one) promises to pay to the order  of  Bank,
its  successors and assigns, without setoff, at its offices indicated  at
the  beginning of this Note, or at such other place as may be  designated
by  Bank, the principal amount of Three Million Five Hundred Thousand and
No/100  Dollars ($3,500,000), or so much thereof as may be advanced  from
time  to  time  in  immediately available funds, together  with  interest
computed  daily  on the outstanding principal balance  hereunder,  at  an
annual  interest  rate,  and  in accordance with  the  payment  schedule,
indicated below.

1.   RATE.  The interest rate shall be the Bank's Prime Rate or the LIBOR
Rate  plus  225 basis points, as provided in the Rate Addendum  which  is
attached hereto.

Notwithstanding any provision of this Note, Bank does not intend to charge
and Borrower shall not be required to pay any amount of interest or other
charges  in excess of the maximum permitted by applicable law.   Borrower
agrees that during the full term hereof, the maximum lawful interest rate
for  this Note as determined under Texas law shall be the indicated  rate
ceiling  as specified in the Texas Finance Code.  Further, to the  extent
that any other lawful rate ceiling exceeds the rate ceiling so determined
then  the higher rate ceiling shall apply.  Any payment in excess of such
maximum  shall be refunded to Borrower or credited against principal,  at
the option of Bank.

2.   ACCRUAL METHOD.  Unless otherwise indicated, interest at the Rate set
forth  above  will be calculated based on an actual year of  365  or  366
days.

3.    RATE CHANGE DATE.    Any Rate based on a fluctuating index or  base
rate will change, unless otherwise provided, each time and as of the date
that the index or base rate changes.

In  the  event any index is discontinued, Bank shall substitute an  index
determined by Bank to be comparable, in its sole discretion.

4.    PAYMENT SCHEDULE.  All payments received hereunder shall be applied
first to the payment of any expense or charges payable hereunder or under
any  other loan documents executed in connection with this Note, then  to
interest  due and payable, with the balance applied to principal,  or  in
such other order as Bank shall determine at its option.

SINGLE  PRINCIPAL PAYMENT.  Principal shall be paid in full in  a  single
payment  on  October 5, 2001.  Interest thereon shall be paid  quarterly,
commencing  on  June 3, 2000, and continuing on the  third  day  of  each
successive March, June, September and December thereafter, with  a  final
payment of all unpaid interest at the stated maturity of this Note.


<PAGE>                                26

5.   REVOLVING FEATURE.  [Not applicable]

6.   WAIVERS, CONSENTS AND COVENANTS.  Borrower, any indorser or guarantor
hereof,  or  any  other  party  hereto  (individually  an  "Obligor"  and
collectively  "Obligors")  and each of them jointly  and  severally:  (a)
waive presentment, demand, protest, notice of demand, notice of intent to
accelerate, notice of acceleration of maturity, notice of protest, notice
of  nonpayment, notice of dishonor, and any other notice required  to  be
given  under  the  law to any Obligor in connection  with  the  delivery,
acceptance,  performance,  default  or  enforcement  of  this  Note,  any
endorsement or guaranty of this Note, or any other documents executed  in
connection with this Note  or any other note or other loan documents  now
or  hereafter executed in connection with any obligation of  Borrower  to
Bank  (the  "Loan  Documents"); (b) consent to  all  delays,  extensions,
renewals  or  other modifications of this Note or the Loan Documents,  or
waivers  of  any  term  hereof or of the Loan Documents,  or  release  or
discharge  by  Bank  of  any  of Obligors, or  release,  substitution  or
exchange of any security for the payment hereof, or the failure to act on
the  part of Bank, or any indulgence shown by Bank (without notice to  or
further  assent  from any of Obligors),  and agree that no  such  action,
failure  to act or failure to exercise any right or remedy by Bank  shall
in  any  way  affect  or impair the obligations of  any  Obligors  or  be
construed  as  a waiver by Bank of, or otherwise affect,  any  of  Bank's
rights under this Note, under any endorsement or guaranty of this Note or
under  any  of the Loan Documents; and (c) agree to pay, on  demand,  all
costs  and  expenses  of collection or defense of this  Note  or  of  any
endorsement  or  guaranty  hereof and/or the enforcement  or  defense  of
Bank's  rights  with  respect  to,  or the  administration,  supervision,
preservation,  or  protection  of,  or  realization  upon,  any  property
securing   payment  hereof,  including,  without  limitation,  reasonable
attorney's  fees,  including  fees related  to  any  suit,  mediation  or
arbitration  proceeding, out of court payment agreement,  trial,  appeal,
bankruptcy  proceedings or other proceeding, in such  amount  as  may  be
determined   reasonable  by  any  arbitrator  or  court,   whichever   is
applicable.

Borrower and NationsBank of Texas, N.A. have entered into a Loan Agreement
dated   August  31, 1995, which has been amended by a First Amendment  to
Loan  Agreement dated July 31, 1996, a Second Amendment to Loan Agreement
dated July 17, 1998 and a Third Amendment to Loan Agreement of even  date
herewith (now and as hereafter amended, the "Loan Agreement").   Borrower
represents that all of the covenants in the Loan Agreement are  true  and
correct.   Borrower covenants that it will keep all of the covenants  and
agreements  set  forth  in  the  Loan Agreement.   No   waiver,  consent,
modification or amendment with respect  to this Promissory Note shall  be
effective without compliance with the provisions of Paragraph 6.4 of  the
Loan Agreement.

7.   PREPAYMENTS.  Prepayments may be made in whole or in part at any time
on  any  loan  for  which  the Rate is based  on  the  Prime  Rate.   All
prepayments  of  principal  shall be applied  in  the  inverse  order  of
maturity,  or  in such other order as Bank shall determine  in  its  sole
discretion.   No prepayment of any other loan shall be permitted  without
the prior written consent of Bank.  Notwithstanding such prohibition,  if
there  is  a prepayment of any such loan, whether by consent of Bank,  or
because  of acceleration or otherwise, Borrower shall, within 15 days  of
any request by Bank, pay to Bank any loss or expense which Bank may incur
or  sustain as a result of such prepayment, including but not limited  to
any  Breakage  Fee due to payment before the end of the  then  applicable
LIBOR Interest Period.  For the purposes of calculating the amounts  owed
only, it shall be assumed that Bank actually funded or committed to  fund
the  loan through the purchase of an underlying deposit in an amount  and
for  a  term comparable to the loan, and such determination by Bank shall
be conclusive, absent a manifest error in computation.


<PAGE>                                27

8.   EVENTS OF DEFAULT. The occurrence of any Event of Default specified in
Paragraph  5.1  of  the  Loan Agreement, unless  cured  within  the  time
specified  therein,  shall  constitute an Event  of  Default  under  this
Promissory Note. The following are also events of default hereunder:  (a)
the  failure  to pay or perform any obligation, liability or indebtedness
of  any  Obligor to Bank, or to any affiliate or subsidiary  of  Bank  of
America  Corporation, whether under this Note or any Loan  Documents,  as
and  when due (whether upon demand, at maturity or by acceleration);  (b)
the  failure  to  pay  or  perform  any other  obligation,  liability  or
indebtedness  of  any Obligor to any other party; (c) the  death  of  any
Obligor  (if  an  individual); (d) the resignation or withdrawal  of  any
partner or a material owner/guarantor of Borrower, as determined by  Bank
in  its sole discretion; (e) the commencement of a proceeding against any
Obligor  for  dissolution  or liquidation, the voluntary  or  involuntary
termination  or dissolution of any Obligor or the merger or consolidation
of  any  Obligor with or into another entity; (f) the insolvency of,  the
business  failure of, the appointment of a custodian, trustee, liquidator
or  receiver  for or for any of the property of, the assignment  for  the
benefit  of  creditors by, or the filing of a petition under  bankruptcy,
insolvency  or  debtor's relief law or the filing of a petition  for  any
adjustment  of indebtedness, composition or extension by or  against  any
Obligor;  (g)  the  determination  by Bank  that  any  representation  or
warranty  made to Bank by any Obligor in any Loan Documents or  otherwise
is  or  was, when it was made, untrue or materially misleading;  (h)  the
failure  of  any  Obligor  to timely deliver such  financial  statements,
including   tax   returns,  other  statements  of  condition   or   other
information, as Bank shall request from time to time; (i) the entry of  a
judgment against any Obligor which Bank deems to be of a material nature,
in  Bank's  sole  discretion; (j) the seizure or forfeiture  of,  or  the
issuance  of  any writ of possession, garnishment or attachment,  or  any
turnover order for any property of any Obligor; (k) the determination  by
Bank  that it is insecure for any reason; (l) the determination  by  Bank
that a material adverse change has occurred in the financial condition of
any Obligor; or (m) the failure of Borrower's business to comply with any
law or regulation controlling its operation.

9.   REMEDIES UPON DEFAULT.  The effect of the occurrence of any Event of
Default under this Promissory Note shall be as specified in Paragraph 5.2
of  the Loan Agreement.  In addition, upon the occurrence of an Event  of
Default which is not cured within the time specified therein, the Rate of
Interest on this Promissory Note shall be increased, from and after  such
date,  to   the  Prime Rate plus three percent (3.0%) per annum,  not  to
exceed  the  maximum  rate  allowed by law   (the  "Default  Rate").  The
provisions  herein for a Default Rate shall not be deemed to  extend  the
time  for any payment hereunder or to constitute a "grace period"  giving
Obligors a right to cure any default.  At Bank's option, any accrued  and
unpaid  interest,  fees  or charges may, for purposes  of  computing  and
accruing interest on a daily basis after the due date of the Note or  any
installment  thereof,  shall be deemed to be  a  part  of  the  principal
balance, and interest shall accrue on a daily compounded basis after such
date  at  the  Default  Rate  provided in  this  Note  until  the  entire
outstanding  balance of principal and interest is paid in full.   Upon  a
default  under this Note, Bank is hereby authorized at any time,  at  its
option  and  without notice or demand, to set off and charge against  any
deposit  accounts  of  any  Obligor (as well as any  money,  instruments,
securities,  documents, chattel paper, credits, claims,  demands,  income
and  any  other property, rights and interests of any Obligor), which  at
any  time shall come into the possession or custody or under the  control
of  Bank or any of its agents, affiliates or correspondents, any and  all
obligations due hereunder.  Additionally, Bank shall have all rights  and
remedies  available  under each of the Loan Documents,  as  well  as  all
rights and remedies available at law or in equity.


<PAGE>                                28

10.   NON-WAIVER.  The failure at any time of Bank to exercise any of its
options  or  any  other rights hereunder shall not  constitute  a  waiver
thereof,  nor shall it be a bar to the exercise of any of its options  or
rights  at  a  later  date.  All rights and remedies  of  Bank  shall  be
cumulative  and may be pursued singly, successively or together,  at  the
option of Bank.  The acceptance by Bank of any partial payment shall  not
constitute a waiver of any default or of any of Bank's rights under  this
Note.   No waiver of any of its rights hereunder, and no modification  or
amendment  of  this Note, shall be deemed to be made by Bank  unless  the
same shall be in writing, duly signed on behalf of Bank; each such waiver
shall  apply  only  with respect to the specific instance  involved,  and
shall  in no way impair the rights of Bank or the obligations of Borrower
to Bank in any other respect at any other time.

11.  APPLICABLE LAW, VENUE AND JURISDICTION. This Promissory Note shall be
subject  to  all  of  the  provisions of the Loan Agreement  relating  to
applicable  law,  venue and jurisdiction, including but  not  limited  to
Paragraphs 6.11 through 6.14 thereof.

12.   PARTIAL  INVALIDITY.  The unenforceability  or  invalidity  of  any
provision of this Note shall not affect the enforceability or validity of
any  other provision herein and the invalidity or unenforceability of any
provision  of  this  Note  or  of the Loan Documents  to  any  person  or
circumstance  shall  not affect the enforceability or  validity  of  such
provision as it may apply to other persons or circumstances.

13.   BINDING EFFECT.  This Note shall be binding upon and inure  to  the
benefit  of  Borrower, Borrower and Bank and their respective successors,
assigns, heirs and personal representatives, provided, however,  that  no
obligations  of  Borrower or Borrower hereunder can be  assigned  without
prior written consent of Bank.

14.  CONTROLLING DOCUMENT.  To the extent that this Note conflicts with or
is  in  any way incompatible with any other document related specifically
to the loan evidenced by this Note, the Loan Agreement shall control over
any  other  such document, and if the Loan Agreement does not address  an
issue, then this Note and such other document shall control to the extent
that it deals most specifically with an issue.

15.   ARBITRATION.  ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES
HERETO  INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING  TO
THIS  INSTRUMENT,  AGREEMENT  OR DOCUMENT  OR  ANY  RELATED  INSTRUMENTS,
AGREEMENTS OR DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM  AN
ALLEGED  TORT,  SHALL BE DETERMINED BY BINDING ARBITRATION IN  ACCORDANCE
WITH  THE  FEDERAL ARBITRATION ACT (OR IF NOT APPLICABLE, THE  APPLICABLE
STATE  LAW),  THE RULES OF PRACTICE AND PROCEDURE FOR THE ARBITRATION  OF
COMMERCIAL  DISPUTES  OF  J.A.M.S./ENDISPUTE  OR  ANY  SUCCESSOR  THEREOF
("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW.  IN THE  EVENT  OF
ANY  INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL.  JUDGMENT  UPON  ANY
ARBITRATION  AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION.   ANY
PARTY  TO  THIS  INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING  AN  ACTION,
INCLUDING A SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY
CONTROVERSY OR CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT  HAVING
JURISDICTION OVER SUCH ACTION.

A.    SPECIAL RULES.  THE ARBITRATION SHALL BE CONDUCTED IN THE COUNTY OF
ANY  BORROWER'S DOMICILE AT THE TIME OF THE EXECUTION OF THIS INSTRUMENT,
AGREEMENT  OR DOCUMENT AND ADMINISTERED BY J.A.M.S. WHO WILL  APPOINT  AN
ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING
THE  ARBITRATION, THEN THE AMERICAN ARBITRATION ASSOCIATION  WILL  SERVE.
ALL  ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90 DAYS OF THE  DEMAND
FOR  ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY, UPON A  SHOWING  OF
CAUSE, BE PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP  TO
AN ADDITIONAL 60 DAYS.

<PAGE>                                29

B.   RESERVATION OF RIGHTS.  NOTHING IN THIS ARBITRATION PROVISION SHALL BE
DEEMED  TO  (I)  LIMIT  THE  APPLICABILITY OF  ANY  OTHERWISE  APPLICABLE
STATUTES  OF  LIMITATION  OR  REPOSE AND ANY WAIVERS  CONTAINED  IN  THIS
INSTRUMENT,  AGREEMENT OR DOCUMENT; OR (II) BE A WAIVER BY  BANK  OF  THE
PROTECTION  AFFORDED  TO  IT BY 12 U.S.C. SEC. 91  OR  ANY  SUBSTANTIALLY
EQUIVALENT  STATE  LAW; OR (III) LIMIT THE RIGHT OF BANK  HERETO  (A)  TO
EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED TO) SETOFF,  OR  (B)
TO  FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY COLLATERAL, OR (C) TO
OBTAIN  FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH AS  (BUT  NOT
LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT OF A
RECEIVER.   BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON  SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING
OR  AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT  TO
THIS  INSTRUMENT, AGREEMENT OR DOCUMENT.  NEITHER THIS EXERCISE  OF  SELF
HELP  REMEDIES  NOR  THE  INSTITUTION OR MAINTENANCE  OF  AN  ACTION  FOR
FORECLOSURE  OR  PROVISIONAL  OR ANCILLARY REMEDIES  SHALL  CONSTITUTE  A
WAIVER  OF  THE RIGHT OF ANY PARTY, INCLUDING THE CLAIMANT  IN  ANY  SUCH
ACTION,  TO  ARBITRATE THE MERITS OF THE CONTROVERSY OR CLAIM OCCASIONING
RESORT TO SUCH REMEDIES.

Borrower represents to Bank that the proceeds of this loan are to be used
primarily  for  business, commercial or agricultural purposes.   Borrower
acknowledges having read and understood, and agrees to be bound  by,  all
terms and conditions of this Note.

NOTICE OF FINAL AGREEMENT:

THE  WRITTEN  LOAN  AGREEMENT, THIS PROMISSORY NOTE AND  ALL  OTHER  LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES, AND MAY  NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS  OF  THE  PARTIES.   THERE ARE NO  UNWRITTEN  ORAL  AGREEMENTS
BETWEEN THE PARTIES.


Bank:                                 Borrower:

BANK OF AMERICA, N.A.                 HITOX CORPORATION OF AMERICA, INC.

By: TOM L. HUNT                       By: RICHARD L. BOWERS
    ------------                          -----------------
    Tom L. Hunt                           Richard L. Bowers
    Vice President                        Executive Vice President


<PAGE>                                30

                               RATE ADDENDUM

     This  Addendum  is  attached  to and  made  a  part  of  that  certain
Promissory Note ("Note") in the amount of $3,500,000, dated March 3,  2000,
executed by Hitox Corporation of America, Inc. ("Borrower") and payable  to
the order of Bank of America, N.A. ("Bank").

     1.    Pre-Maturity  Interest  Rate.   At  the  election  of  Borrower,
Borrower will have the option, to be exercised at the time of each  request
for  an Advance on this Note, of choosing between one of two interest  rate
formulas  for  interest to accrue on the principal being  so-advanced  (the
"Pre-Maturity Interest Rate on the Advance").

          a.    Prime Rate Option.  Borrower may choose as the Pre-Maturity
Interest Rate on the Advance (a "Prime Rate Option Advance") a varying rate
per  annum  which shall be equal to the lesser of (a) the  Prime  Rate  (as
herein defined), such varying rate to change automatically, effective as of
the  date of each change in the Prime Rate, to reflect such change  in  the
Prime  Rate  without  notice to Borrower or any other person,  or  (b)  the
maximum  rate  permitted  by  applicable  law  (the  "Maximum  Rate"),   as
hereinafter limited (the "Prime Rate Option").

          b.    LIBOR  Rate Option.  Alternatively, Borrower may choose  as
the  Pre-Maturity  Interest  Rate on the  Advance  (a  "LIBOR  Rate  Option
Advance") the LIBOR Rate plus 225 basis points (the "Interest Rate Margin")
(the "LIBOR Rate Option").

     2.   Prepayment.

          a.   Prime Rate Option.  Principal advanced pursuant to the Prime
Rate Option may be prepaid at any time.

          b.    LIBOR Rate Option.  No prepayment of any LIBOR Rate  Option
Advance  shall  be  permitted without the prior written  consent  of  Bank.
Notwithstanding such prohibition, if there is any prepayment of  any  LIBOR
Rate Option Advance, whether by consent of Bank, or because of acceleration
or otherwise, Borrower shall, within 15 days of any request by Bank, pay to
Bank  the Breakage Fee as provided in the Loan Agreement, but not to exceed
the maximum permissible by applicable law.  For the purposes of calculating
the  amounts  owed only, it shall be assumed that Bank actually  funded  or
committed  to  fund the amount of the Advance through the  purchase  of  an
underlying  LIBOR  deposit in an amount, and for a term comparable  to  the
Advance under the LIBOR Rate Option, and such determination by Bank will be
conclusive, absent a manifest error in computation.


<PAGE>                                31

     3.   LIBOR Rate Terminology.  The following are definitions of various
terms used in conjunction with the LIBOR Rate Option.

          a.    "LIBOR Rate" shall mean an interest rate per annum equal to
a rate determined pursuant to the following formula:

                              Eurodollar Rate
                              ---------------
                   100% - Eurodollar Reserve Percentage

          b.    "Eurodollar  Reserve  Percentage" shall  mean  the  maximum
reserve   requirement   (including,   without   limitation,   any    basic,
supplemental, marginal and emergency reserves) (expressed as a  percentage)
applicable  to  member banks of the Federal Reserve System  in  respect  of
"Eurocurrency Liabilities" under Regulation D of the board of Governors  of
the  Federal  Reserve  System, or such additional, substituted  or  amended
reserve requirement as may be hereafter applicable to member banks  of  the
Federal Reserve System.

          c.    "Eurodollar  Rate" shall mean for the  applicable  Interest
Period,  the  rate of interest per annum (rounded upward, if necessary,  to
the  nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any successor
page)  as  the  London interbank offered rate for deposits  in  Dollars  at
approximately 11:00 a.m. (London time) two Business Days prior to the first
day  of such Interest Period for a term comparable to such Interest Period.
If  for  any reason such rate is not available, the term "Eurodollar  Rate"
shall  mean, for any Eurodollar Loan for any Interest Period therefor,  the
rate per annum (rounded upwards, if necessary, to the nearest 1/100 of  1%)
appearing on Reuters Screen LIBOR Page as the London interbank offered rate
for  deposits  in  Dollars at approximately 11:00 a.m.  (London  time)  two
Business  Days prior to the first day of such Interest Period  for  a  term
comparable  to  such Interest Period; provided, however, if more  than  one
rate  is specified on Reuters Screen LIBOR Page, the applicable rate  shall
be the arithmetic mean of all such rates.

     If  no  such offers or quotes are generally available for such amount,
then  Bank shall be entitled to determine the Eurodollar Rate by estimating
in  its  reasonable judgment the per annum rate (as described  above)  that
would be applicable if such quotes or offers were generally available.


<PAGE>                                32

          d.   "Interest Period" means, for each LIBOR Rate Option Advance,
a  period of 30 days, commencing in the first instance on the first date of
the first LIBOR Rate Option Advance under the Note and ending 30 days after
that  date,  and  then each successive 30 day period thereafter;  provided,
however,  that Borrower shall be entitled to change the Interest Period  to
60 days or 90 days, but only if Borrower furnishes Bank with written notice
delivered  at  least  two business days prior to  the  final  date  of  the
Interest Period then in effect, instructing Bank to make such change to the
Interest Period specified in said notice.  The interest rate payable on the
Note shall be adjusted to the LIBOR Rate then in effect for each successive
Interest Period plus 225 basis points; provided, however, that:

               (1)   Whenever  the  last day of any Interest  Period  would
otherwise  occur on a day other than a business day, the last day  of  such
Interest  Period shall be extended to occur on the next succeeding business
day,  provided,  that  such extension would cause  the  last  day  of  such
Interest Period to occur in the next calendar month, the last day  of  such
Interest  Period  shall in such case occur on the next  preceding  business
day; and

               (2)   No Interest Period may extend beyond the Maturity Date
of this Loan.

          e.    "Eurodollar Rate Loan" shall mean each Advance which  bears
interest based on the LIBOR Rate.

          f.   "Business Day" shall mean in the case of Eurodollar Loans, a
U.S. domestic business day and a day on which commercial banks are open for
international  business  (including dealings in U.S.  dollar  deposits)  in
London.

     4.   Manner of Borrowing and Disbursement.

          a.     Prime  Rate  Option Advances.  In the case of  Prime  Rate
Option  Advances,  the Borrower shall give the Bank at least  one  Business
Days' irrevocable written notice, or irrevocable telephonic notice followed
immediately  by  written  notice (provided, however,  that  the  Borrower's
failure  to  confirm any telephonic notice in writing shall not  invalidate
any notice so given), of Borrower's intention to borrow or reborrow a Prime
Rate Option Advance hereunder.  Notice shall be given to the Bank prior  to
11:00  a.m.,  in  order for such Business Day to count toward  the  minimum
number  of Business Days required.  Such notice of borrowing shall  specify
the  requested funding date, which shall be a Business Day, and the  amount
of the proposed aggregate Prime Rate Option Advances to be made by Bank.


<PAGE>                                33

          b.   LIBOR Rate Option Advances.

               (1)   LIBOR Rate Option Advances.  Advances under the  LIBOR
Rate  Option  will  be  in amounts of $1,000,000 or greater,  and  will  be
advanced  for periods equal to the LIBOR Rate Interest Period  selected  by
Borrower.

               (2)   Advance Borrowing Notice.  In the case of  LIBOR  Rate
Option  Advances,  the Borrower shall give the Bank at least  two  Business
Days' irrevocable written notice, or irrevocable telephonic notice followed
immediately  by  written  notice (provided, however,  that  the  Borrower's
failure  to  confirm any telephonic notice in writing shall not  invalidate
any  notice so given), of its intention to borrow or reborrow a LIBOR  Rate
Option Advance hereunder.  Notice shall be given to the Bank prior to 11:00
a.m., in order for such Business Day to count toward the minimum number  of
Business  Days required.  LIBOR Rate Option Advances shall in all cases  be
subject  to  availability and to paragraph 4b(3)  below.   For  LIBOR  Rate
Option  Advances,  the  notice  of borrowing shall  specify  the  requested
funding  date,  which shall be a Business Day, the amount of  the  proposed
aggregate  LIBOR Rate Option Advances to be made by Bank and  the  Interest
Period  selected  by  the Borrower, provided that no such  Interest  Period
shall extend past the Maturity Date of the Loan.

          c.    Readvances.   At  least two Business  Days  prior  to  each
Payment Date for a LIBOR Rate Option Advance, Borrower shall give the  Bank
irrevocable  written  notice,  or irrevocable  telephonic  notice  followed
immediately  by written notice (provided, however, that Borrower's  failure
to confirm any telephonic notice in writing shall not invalidate any notice
so  given),  specifying whether all or a portion of such LIBOR Rate  Option
Advance  outstanding  on the Payment Date (i) is  to  be  repaid  and  then
reborrowed in whole or in part as a LIBOR Rate Option Advance, or  (ii)  is
to be repaid and then reborrowed in whole or in part as a Prime Rate Option
Advance;  provided, however, notwithstanding anything in this Note  to  the
contrary,  (a)  if no notice is given the LIBOR Rate Option  Advance  shall
automatically be reborrowed at the LIBOR Rate for a 30 day Interest Period,
and  (b) if on any Payment Date an Event of Default shall exist, such LIBOR
Rate  Option Advance may only be reborrowed as a Prime Rate Option Advance.
Upon  such  Payment Date, such LIBOR Rate Option Advance shall, subject  to
the provisions hereof, be so repaid and reborrowed.


<PAGE>                                34

     5.   Changes in Circumstances.

               (a)   LIBOR Basis Determination Inadequate.  If with respect
to  any  LIBOR Rate Option Advance for any Interest Period, Bank determines
that  (i)  deposits  in dollars (in the applicable amount)  are  not  being
offered to the Bank in the relevant market for such Interest Period or (ii)
the  LIBOR Rate for such proposed Interest Period does not adequately cover
the  cost  to Bank of maintaining the outstanding principal amount  of  the
Note for such Interest Period, Bank shall forthwith give notice thereof  to
the  Borrower,  whereupon the interest rate on the Note shall automatically
convert to the Bank's Prime Rate, as adjusted on a daily basis.

               (b)  Illegality.  If any applicable law, rule or regulation,
or   any   change  therein  or  adoption  thereof,  or  interpretation   or
administration  thereof  by  any governmental authority,  central  bank  or
comparable   agency  charged  with  the  interpretation  or  administration
thereof,  or  compliance by Bank with any request or directive (whether  or
not  having  the  force  of  law) of any such authority,  central  bank  or
comparable  agency, shall make it unlawful or impossible for the  Bank   to
make, maintain or fund the principal amount of the Note at the then current
LIBOR  Rate  for the Interest Period selected by Borrower,  Bank  shall  so
notify the Borrower, and upon receipt of such notice,  the interest rate on
the  Note shall automatically convert to the Bank's Prime Rate, as adjusted
on a daily basis.

                                HITOX CORPORATION OF AMERICA, INC.

                                By: RICHARD L. BOWERS
                                    ------------------------
                                    Richard L. Bowers,
                                    Executive Vice President


<PAGE>                                35

                        BORROWING BASE CERTIFICATE

     This  Borrowing Base Certificate is delivered pursuant  to   Paragraph
1.2  of the Loan Agreement  dated August 31, 1995 between Hitox Corporation
of America, Inc. ("Borrower") and NationsBank of Texas, N.A., as amended by
First, Second and Third Amendments to Loan Agreement (as amended, the "Loan
Agreement") executed by Borrower and by Bank of America, N.A., successor in
interest by merger to NationsBank of Texas, N.A. ("Bank").  Words which are
capitalized herein which are defined in said Loan Agreement shall have  the
same  meanings  specified in the Loan Agreement.   The  undersigned  hereby
certifies  that the following amounts and statements are true and  correct,
as of _________________, 19____.


      1.    Eligible Accounts Receivable
                   ($____________ x 80%)             $______________
                   ("Borrowing Base Amount")

      2.    Less the amount of all advances
            presently outstanding under the
            Revolving Note                           -______________

      3.    Less the amount of all Letter of
            Credit Obligations outstanding under
            Revolving Note                           -______________

      4.    Amount available for additional
            advances under the Revolving Note        $______________


     [If  an  advance  is  being requested herewith] Borrower  requests  an
advance of $__________________ under the Revolving Note.

     I  hereby  certify  that  all  of the information  contained  in  this
Borrowing Base Certificate is true and correct as of the date shown  above,
that  the balance sheet, profit and loss statement, inventory list and aged
list  of accounts receivable attached hereunto are true and correct  as  of
said  date,  that no material adverse change in the financial condition  of
Borrower  has  occurred  since said date, and  that  no  Event  of  Default
specified in the Loan Agreement has occurred.

                              Hitox Corporation of America, Inc.

                              By:  ______________________________
                                   Craig Schkade, Chief Financial
                                   Officer and Treasurer


                                 EXHIBIT B

<PAGE>                                36

                          COMPLIANCE CERTIFICATE

     This Compliance Certificate is delivered pursuant to  Paragraph 4.4 of
the  Loan  Agreement  dated August 31, 1995 between  HITOX  CORPORATION  OF
AMERICA,  INC. ("Borrower") and NationsBank of Texas, N.A., as  amended  by
First, Second and Third Amendments to Loan Agreement (as amended, the "Loan
Agreement")  executed  by Borrower and by BANK OF AMERICA,  N.A.  ("Bank"),
successor in interest by merger to NationsBank of Texas, N.A.   Words which
are  capitalized herein which are defined in said Loan Agreement shall have
the  same  meanings specified in the Loan Agreement.  The  undersigned,  on
behalf  of  the  Borrower,  hereby  certifies  and  warrants  pursuant   to
Paragraphs 4.19 through 4.21 of the Loan Agreement, as follows:

     1.    The undersigned is authorized to make this certificate on behalf
of the Borrower.

     2.   As of ____________________, 19_____:

          (a)  Section 4.19.  Borrower's Ratio of Current Assets to Current
Liabilities  is  ____  to  1.0  on said date,  computed  as  set  forth  on
Attachment 1.

          (a)   Section  4.20.  Borrower's Ratio of Total Debt to  Tangible
Net  Worth  is  ____  to  1.0 for the twelve months ending  on  said  date,
computed as set forth on Attachment 2;

          (b)   Section 4.21.  Borrower's Funded Debt Coverage is  ____  to
1.0 on said date, computed as set forth on Attachment 3; and

          (d)   No  Default.  Borrower was not in default  of  any  of  the
provisions  of  the Loan Agreement during the three month period  to  which
this Compliance Certificate relates;

     IN  WITNESS  WHEREOF, the undersigned has executed and delivered  this
certificate to Bank this _____ day of ______________, 20______.

                              Hitox Corporation of America, Inc.


                              By:  ______________________________
                                   Craig Schkade, Chief Financial
                                   Officer and Treasurer

                              By:  ______________________________
                                   Bernard Paulson, President and CEO


                                 EXHIBIT D

<PAGE>                                37

                                                               Exhibit 99.1


                                                      For Immediate Release



                  Hitox Corporation Completes Purchase of
                      Malaysian Titanium Corporation


     Corpus  Christi,  TX  (March 6, 2000) - Hitox Corporation  of  America
(Nasdaq  SmallCap:  HTXA)  announces the  purchase  of  Malaysian  Titanium
Corporation  ("MTC").   Bernard  Paulson,  president  and  CEO,  said   the
agreement  was  executed in Malaysia March 3rd with an  effective  date  of
March  1st.  The purchase price totaled $5,150,000 of which $3,775,000  was
in  cash  and  $1,375,000 in Hitox Common Stock (500,000 shares  valued  at
$2.75  per  share).  MTC is a profitable company and will be managed  as  a
wholly owned subsidiary with close coordination of manufacturing and sales.

     MTC  is  not only the sole supplier of raw material for the  Company's
proprietary  titanium  pigment  HITOX  (Register  trademark)  but  is  also
producing  and  selling  that product in Asia  and  Europe  under  license.
Paulson  said  that  the  Company plans an immediate  doubling  of  pigment
capacity at MTC as the existing production line is almost sold out in  less
than   a   year  after  opening.   Asian  and  European  markets  represent
substantial  opportunities for both HITOX and the Company's other  products
which will be offered by MTC as soon as practical.

     Based   in  Corpus  Christi,  Texas,  Hitox  Corporation  manufactures
pigments  and extenders that are marketed worldwide to paint, plastics  and
chemical industries.

     Certain matters discussed in this news release include forward-looking
statements that involve risks and uncertainties detailed from time to  time
in  the  Company's  filings and reports with the  Securities  and  Exchange
Commission  including the Company's Annual Report on Form  10-KSB  for  the
year ended 1999.  Such statements are based on the beliefs of the Company's
management  as  well  as  assumptions made  by  and  information  currently
available  to  Company  management.  Actual events or  results  may  differ
materially.

For further information:
Richard L. Bowers
Executive Vice President
361 883-5591

<PAGE>                                38
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SECURITIES AND EXCHANGE COMMISSION
                          WASHINGTON, D.C. 20549

                                 FORM 8-K

                              CURRENT REPORT

  Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

     Date of Report (Date of earliest event reported): March 1, 2000

                       HITOX CORPORATION OF AMERICA
          (Exact name of registrant as specified in its charter)

                                 Delaware
               (State or other jurisdiction of corporation)

                                  0-17321
                         (Commission File Number)

                                74-2081929
                   (I.R.S. Employer Identification No.)

                               722 Burleson
                           Corpus Christi, Texas
                 (Address of principal executive offices)

                                   78402
                                (Zip Code)

    Registrant's telephone number, including area code: (361) 882-5175

                                 --------
       (Former name or former address, if changed since last report)
1

Item 2.  Acquisition or Disposition of Assets

     On  March  6,  2000,  Hitox  Corporation of  America  (the  "Company")
announced the purchase of Malaysian Titanium Corporation Sdn. Bhd. ("MTC"),
a  private  Malaysian  company.   The  sale  and  purchase  agreement  (the
"Agreement")  was signed in Malaysia effective March 1, 2000, and  provided
for the purchase by the Company of all of the issued and outstanding shares
of  MTC from  Megamin Ventures Sdn. Bhd. ("Megamin").  Megamin is also  the
Company's largest shareholder, with approximately 28% of the Company's out-
standing shares as of December 31, 1999. After giving effect to the Agreement,
Megamin  owns approximately 35% of the Company's outstanding shares  as  of
March  1, 2000.  Prior to the Agreement, Megamin had one appointee  to  the
Company's Board of Directors.  Per the Agreement, the Company will nominate
an  additional  person to serve on the Company's Board of  Directors  as  a
representative of Megamin.

     Pursuant to the terms of the Agreement, the Company paid $3,775,000 in
cash and issued 500,000 shares of its common stock in exchange  for 100% of
the shares of MTC.  The Company's shares closed  at $2.00 on  the effective
date of the Agreement.  The Company also agreed to pay  Megamin  a total of
approximately $1,050,000 in four equal semi-annual  payments beginning July
1, 2000.  The discounted  present value of those  payments is approximately
$950,000.  Transaction costs are estimated to total $150,000.   The Company
will record the  transaction as a  purchase, with  a  cost of approximately
$5,875,000, plus assumption of MTC's bank debt of approximately $4,000,000.

     The  cash payment of $3,775,000 was financed through a term loan  (the
"Bank  Loan") with Bank of America, N.A., (the "Bank").  The term loan  has
an initial principal balance of $3,500,000 and is to be repaid in full in a
single payment on October 5, 2001.  The Company may prepay all or a part of
the  principal  outstanding at any time without  penalty,  subject  to  any
restrictions caused by the choice of interest rate.  The interest  rate  is
the Bank's prime rate or the LIBOR rate plus 225 basis points, as chosen by
the  Company.   The  LIBOR based rate is available in  30,  60  or  90  day
tranches,  with a minimum of $1,000,000 for any one tranche.   If  a  LIBOR
based rate is used the Company cannot prepay any principal related to  that
tranche for the period chosen without paying a penalty.  The Company  chose
to  use the 90 day LIBOR tranche for the first interest rate for the entire
$3,500,000 principal balance, with an interest rate of 8.36% per annum.

     MTC  is  the  Company's  sole supplier of Synthetic  Rutile,  the  raw
material  for the Company's proprietary titanium pigment HITOX  (Registered
Trademark).  MTC is also producing HITOX pigment in Malaysia under a license
from the Company and is selling HITOX pigment in Asia and Europe.
2

     MTC  was previously a  subsidiary of Hitox Corporation  and was sold
to Megamin  and  other  investors in  1994.  The acquisition provides the
opportunity to control the raw material supply for the Company's  primary
product, HITOX pigment, and represents both a  low  cost production  site
for HITOX pigment and marketing opportunities outside the U.S. market.

Item 7.  Financial Statements and Exhibits

        (a)  Financial statements are not available, but will be  filed  as
             soon as practicable, but not later than 60 days after the  due
             date of this report.

        (b)  Pro forma financial information is not available, but will  be
             filed as soon as practicable, but not later than 60 days after
             the due date of this report.

        (c)  Exhibits

        Exhibit  No.
        ------------

             2.1     Purchase and  Sale agreement  effective March 1, 2000
                     between  Hitox  Corporation  of  America  and Megamin
                     Ventures  Sdn. Bhd.  The  schedules  to the agreement
                     are as follows and have been omitted from this filing
                     in accordance with Item 601(2) of Regulation S-B, but
                     will be provided to the Commission upon request.

                      (1st) Approval for the sale and purchase of Shares
                            granted by the Ministry of International
                            Trade and Industry of Malaysia

                      (2nd) Audited Financial Statements for the twelve
                            month period ended June 30, 1999

                      (3rd) Audited Financial Statements for the six
                            month period ended December 31, 1999.

             10.1    Third amendment to the loan agreement with Bank of
                     America dated March 3, 2000.

             99.1    Form of press release dated March 6, 2000,
                     announcing the purchase of MTC by Hitox
3

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                            Hitox Corporation of America
                                                   (Registrant)

Date: March 16, 2000                               CRAIG SCHKADE
                                                   -------------
                                                   Craig Schkade
                                              Chief Financial Officer
                                                   and Treasurer
4

                                                                Exhibit 2.1

                     DATED THIS 1st DAY OF MARCH 2000

                                  BETWEEN

                         MEGAMIN VENTURES SDN BHD
                              ("The Vendor")

                                    AND

                       HITOX CORPORATION OF AMERICA
                             ("The Purchaser")

                   ************************************

                        SALE AND PURCHASE AGREEMENT
                                 (SHARES)

                   ************************************

                         Messrs Chan & Associates
                          Advocates & Solicitors
                     Standard Chartered Bank Chambers
                    No 21-27, Jalan Dato Maharaja Lela
                             30000 Ipoh, Perak
5

THIS SALE AND PURCHASE AGREEMENT is made this 1st  day of March 2000

Between:-

MEGAMIN VENTURES SDN BHD (20827-A), a company incorporated in Malaysia with
its  registered office at No 41, Jalan Sultan Azlan Shah Utara, 31400 Ipoh,
Perak (hereinafter called "the Vendor") of the one part;

And

HITOX  CORPORATION OF AMERICA, a company incorporated in  Delaware,  United
States  of  America with its place of business at No 722, Burleson  Street,
Corpus  Christi, Texas 78402, United States of America (hereinafter  called
"the Purchaser") of the other part.

WHEREAS:-

(A) MALAYSIAN   TITANIUM  CORPORATION  SDN  BHD  (14387-W)  is  a   company
     incorporated  in Malaysia with its registered office at  4  1/2  Mile,
     Jalan  Lahat,  30200  Ipoh, Perak (hereinafter  referred  to  as  "the
     Company"),   carries  on  the  principal  business  of   manufacturing
     synthetic  rutile  and  is  in possession of a  manufacturing  licence
     issued by the Ministry of International Trade and Industry of Malaysia
     (hereinafter referred to as "MITI").

(B)  The  Company has an authorised share capital of Ringgit Malaysia Sixty
     Million  (RM60,000,000.00)  divided into  Sixty  Million  (60,000,000)
     ordinary  shares  of Ringgit One (RM1.00) each of  which  Twenty  Four
     Million One Hundred and Thirty Thousand (24,130,000) have been  issued
     and fully paid up or credited as fully paid up.

(C)  The Vendor is the registered owner of Twelve Million Seven Hundred and
     Fifty  Thousand (12,750,000) ordinary shares and the beneficial  owner
     of  Eleven  Million  Three  Hundred and Eighty  Thousand  (11,380,000)
     ordinary  shares  (all  Twenty Four Million  One  Hundred  and  Thirty
     Thousand (24,130,000) shares shall hereinafter be referred to as  "the
     said Shares").

(D)  The  Vendor and the Purchaser had on 1st January 2000 entered  into  a
     Memorandum  of Understanding (hereinafter referred to as "MOU")  which
     sets out the framework and the principal terms and conditions for  the
     sale and purchase of the said Shares between the parties.
6

(E)  Pursuant to the terms of the MOU, the Purchaser had carried out  legal
     and  financial  due  diligence  on the  Company,  undertaken  a  plant
     inspection and have been furnished a copy of the audited accounts  for
     the  financial  year ended 30th June 1999 and for the six  (6)  months
     ended  31st  December  1999 by Kassim Chan & Co.  (a  member  firm  of
     Deloitte Touche Tohmatsu International).

(F)  The Vendor has agreed to sell and the Purchaser has agreed to purchase
     the  said  Shares  for  the  consideration  and  upon  the  terms  and
     conditions hereinafter contained.

NOW THIS AGREEMENT WITNESSETH as follows:-

1.   AGREEMENT

     Subject  to the provisions stipulated herein, the Vendor as legal  and
     beneficial  owner of the said Shares hereby agrees  to  sell  and  the
     Purchaser to purchase the said Shares, free from all claims,  damages,
     liens,  charges and encumbrances for the consideration  and  upon  the
     terms and conditions hereinafter contained.

2.   PURCHASE PRICE

     The  Purchase Price for the said Shares is United States Dollars  Five
     Million   One  Hundred  and  Fifty  Thousand  (US$5,150,000.00)   only
     (hereinafter referred to as "the Purchase Price") which is  calculated
     based on USc21.343 per share.

3.   APPROVAL BY GOVERNMENT AUTHORITY

     The  Company operates under a manufacturing licence issued by MITI and
     as such had submitted an application to MITI for approval for a change
     in  shareholding of the Company. By letter dated 18th  February  2000,
     approval for the sale and purchase of the said Shares has been granted
     by  MITI  without any conditions attached, a copy of which is  annexed
     hereto as the First Schedule.

4.   MANNER OF PAYMENT OF PURCHASE PRICE

     4.1   The Purchase Price shall be paid by the Purchaser partly in cash
     and  partly  by way of shares in Hitox common stocks in the  following
     manner:-
7

     (a)  the  sum of United States Dollars Three Million Seven Hundred and
          Seventy Five Thousand (US$3,775,000.00) (hereinafter referred  to
          as "the Cash Payment") shall be paid to MESSRS CHAN & ASSOCIATES,
          Advocates  &  Solicitors  of 2nd Floor, Standard  Chartered  Bank
          Chambers,  No 21-27, Jalan Dato Maharaja Lela, 31400 Ipoh,  Perak
          (hereinafter  referred  to as "the Stakeholder")  as  stakeholder
          upon the execution of this Agreement; and

     (b)  the  balance  sum  of  United States Dollars  One  Million  Three
          Hundred and Seventy Fifty Thousand (US$1,375,000.00) (hereinafter
          referred to as "the Balance Purchase Price") shall be paid by way
          of  500,000  shares in Hitox common stocks valued at US$2.75  per
          share (hereinafter referred to as "the 500,000 Hitox shares").

     (c)  the  Purchaser  shall  deliver the 500,000 Hitox  shares  to  the
          Stakeholder together with the Cash Payment upon the execution  of
          this Agreement.

     (d)  the  Vendor  agrees  and acknowledges that it  is  acquiring  the
          500,000  Hitox shares for the sole purpose of investment and  not
          with  a  view  to,  or for offer or sale in connection  with  any
          distribution thereof. The Vendor acknowledges receipt  of  copies
          of   the  Purchaser's  current  10K  and  10Q  filings  with  the
          Securities  and Exchange Commission and that it is  knowledgeable
          about  investments  in  general and  about  the  affairs  of  the
          Purchaser in particular. The Vendor acknowledges that the 500,000
          Hitox shares have not been registered under the Securities Act of
          1933,  as  amended, and as such, the 500,000 Hitox  shares  shall
          constitute "restricted securities" within the meaning of Rule 144
          under that Act.

4.2    The  date  of  full  payment of the Balance Purchase  Price  by  the
     Purchaser shall be known as "the Completion Date".

5.   DELIVERY OF SHARE CERTIFICATES, MEMORANDA OF TRANSFER, ETC

5.1  Upon  execution of this Agreement, the Vendor shall deposit  with  the
     Stakeholder  the  shares  certificates  for  Seventeen  Million  Seven
     Hundred   and   Fifty   Thousand  (17,750,000)   shares   representing
     approximately Seventy Three Point Five Six percentum (73.56%)  of  the
     said  Shares  together  with  their  respective  transfer  forms  duly
     executed in favour of the Purchaser.
8

5.2  The  share certificates and the duly executed transfer forms  for  the
     balance  Six  Million  Three Hundred and Eighty Thousand   (6,380,000)
     shares  representing  the  remaining  Twenty  Six   Point  Four   Four
     percentum (26.44%) of the said Shares shall be deposited by the Vendor
     with the Stakeholder on or before 31st March 2000.

5.3  The parties have agreed that the Stakeholder shall:-

     (a)  release  the shares certificates and transfer forms for Seventeen
          Million   Seven   Hundred  Fifty  Thousand  (17,750,000)   shares
          representing approximately Seventy Three Point Five Six percentum
          (73.56%) of the said Shares to the Purchaser simultaneously  with
          the release of the Cash Payment by the Stakeholder to the Vendor;
          and

     (b)  hold  the  share  certificates and the  transfer  forms  for  the
          balance Six Million Three Hundred and Eighty Thousand (6,380,000)
          shares  representing  the remaining Twenty Six  Point  Four  Four
          percentum (26.44%) of the said Shares and to release the same  to
          the  Purchaser  simultaneously with the release  of  the  500,000
          Hitox shares to the Vendor.

6.   BOARD OF DIRECTORS

6.1  Upon  receipt of the Cash Payment, the parties hereto agree  that  the
     Purchaser shall have majority control of the board of directors and on
     the Completion Date, the Purchaser shall have exclusive control of the
     board of directors of the Company.

6.2  To  give effect to the provision in Clause 6.1 above, the Vendor shall
     cause  its  nominees  to  deliver to the  Purchaser  their  respective
     letters  of  resignation  as directors from their  respective  offices
     together with their acknowledgements and confirmation that they do not
     have any claims for damages and compensation against the Company.

7.   REPRESENTATIONS, WARRANTIES AND COVENANTS BY THE VENDOR

7.1  The   Vendor  hereby  represents,  warrants  and  covenants  with  the
     Purchaser that:-

     (a)  the  Vendor has the power and authority to enter into and execute
          this  Agreement to sell the said Shares to the Purchaser and this
          Agreement constitutes a legally binding obligation on the  Vendor
          enforceable  against  it  in accordance  with  the  terms  herein
          contained;
9

     (b)  the  Company  is  a private limited company duly established  and
          validly  existing under the laws of Malaysia and has  full  power
          and  authority  to own and use it properties and  assets  and  to
          carry  on its business as is now being conducted and has obtained
          all  licences and governmental approvals necessary to operate its
          business;

     (c)  the  Company's Memorandum and Articles of Association are in  the
          form of the document signed by or on behalf of the Vendor, a copy
          of  which  has been delivered to the Purchaser and no resolutions
          have  been  or  will  be  passed  effecting  alterations  to  the
          Memorandum and Articles of Association;

     (d)  the  authorised  and issued share capital of the Company  are  as
          stated  in  Recital (B) above and the Company has not  since  the
          date  of  its incorporation issued or agreed to issue any  shares
          (other  than  the aforesaid issued Ordinary Shares) or  given  or
          agreed  to  give any option in respect of any shares nor  of  any
          debenture  or  other securities nor will the  Company  issue  any
          debenture  or  rights  to purchase or subscribe  for  any  shares
          without  the prior consent in writing by the Purchaser after  the
          date of this Agreement;

     (e)  the audited accounts and the balance sheet of the Company for the
          financial period ended 30th June 1999, a copy of which is annexed
          hereto  as the Second Schedule (hereinafter referred to  as  "the
          Existing Accounts") and the audited accounts of the  Company  for
          the six (6) months ended 31st December 1999,  a copy of  which is
          annexed hereto as the Third Schedule  (hereinafter referred to as
          "the Updated Accounts") give a true and fair view of the financial
          position of the Company as at those dates;

     (f)  the  Company  has  not  entered into any long  term  or  abnormal
          contract or undertaken any obligation whatsoever except  such  as
          are  usual and necessary in the ordinary and proper course of its
          business  and  which do not impose any burdensome obligations  on
          the  Company  or as are referred to in the Existing Accounts  and
          the Updated Accounts;

     (g)  the  Company has good and indefeasible title to all of its assets
          free  and clear of all liens and encumbrances except as shown  in
          the Updated Accounts and as disclosed by the Vendor in writing to
          the  Purchaser  and  the Company has conducted  its  business  in
          compliance with all laws rules and regulations;
10

     (h)  all  assets of the Company held under lease are held under  valid
          and  enforceable  leases and the Company  has  not  received  any
          notice  from any lessor of the Company's non-compliance with  any
          lease obligation, and the Company is in compliance with the terms
          and  conditions of all agreements to which it is a party and  has
          received no notice from any party asserting the existence of  any
          breach  thereof  by  the Company nor any outstanding  notices  in
          respect of any of its properties or assets;

     (i)  there  are  not  in  existence  any  contracts  of  service  with
          directors or employees of the Company or any retirement scheme or
          policy  for  its  employees  or any consultancy  agreements  with
          anyone  which  cannot be terminated by the Company by  three  (3)
          months'  notice  or  less or (where not reduced  to  writing)  by
          reasonable notice without giving rise to any claim for damages or
          compensation  (other  than  a  statutory  redundancy  payment  or
          statutory compensation for unfair dismissal);

     (j)  the  Company  has  no  outstanding  debts,  claims,  liabilities,
          contracts or engagements otherwise than in the ordinary course of
          its  business or as disclosed in the Existing Accounts or Updated
          Accounts period or in writing to the Purchaser;

     (k)  no  part of the amounts included in the Existing Accounts  or  in
          the books of the Company as due from debtors has been released on
          terms  that any debtor pays less than the book value of his  debt
          as  at  31st December 1999 (hereinafter referred to as "the  Said
          Date") or has been written off;

     (l)  the Company  has  not  since  the  Said  Date  entered  into  any
          substantial capital transaction other than in the ordinary course
          of  business either as vendor or purchaser, nor entered into  any
          material  commitments nor undertaken any material obligations  or
          incurred any material capital expenditure;

     (m)  returns, particulars, resolutions and other documents required to
          be  delivered  by the Company to the Registrar of Companies  have
          been properly, correctly and duly delivered to such Registrar;

     (n)  there  has been no substantial increase in any fees or emoluments
          paid  or  payable to any officer or servant of the Company  since
          the Said Date;
11

     (o)  the  tax  returns of the Company have at all times been  correct,
          made on a proper basis and not the subject of any back duty claim
          or  dispute with the revenue authorities, and the provisions  for
          taxation  up  to  the Said Date in the Existing Accounts  of  the
          Company is sufficient to cover all taxation (whether income  tax,
          surtax,  profits  tax, excess profits tax, excess  profits  levy,
          special  contribution or real property gains  tax  or  any  other
          taxes,   charges  and  impositions  relevant  to  the   Company's
          business) for which the Company was at the Said Date or any  time
          thereafter may have become liable to be assessed or to pay;

     (p)  save as otherwise disclosed herein, the Company has not since the
          Said  Date paid or made and will not pending completion hereunder
          pay  or  make any dividend or other distribution, loan or advance
          to any person, firm or company;

     (q)  the  Company  does not use its letterheads, books or vehicles  or
          otherwise  carry  in  business under  any  name  other  than  its
          corporate name;

     (r)  the  Company  is  not  engaged in any litigation  or  arbitration
          proceedings  nor  is the Vendor aware of any circumstances  which
          may  give  rise  to  any  litigation or  arbitration  proceedings
          against the Company except as disclosed to the Purchaser;

     (s)  the Company has effected and maintained all permits, licences and
          insurance  necessary and proper to be effected and maintained  by
          reason of the nature of the business carried on and has duly paid
          all  fees  and  premia in respect thereof and all  such  permits,
          licences  and  insurance are now in force  and  not  voidable  on
          account  of any act or omission or non-disclosure on the part  of
          the Company and there is no breach of any terms and conditions of
          any  such  permits,  licences  or insurance  which  may  lead  to
          avoidance  or  revocation of such permits, licences or  insurance
          and the making and implementation of this Agreement will not lead
          to   avoidance  or  revocation  of  such  permits,  licences   or
          insurance;

     (t)  the  Company has not since the Said Date acquired any  assets  on
          hire  purchase  or deferred terms or entered into  any  equipment
          leasing arrangements;

     (u)  the  Company has not since the Said Date knowingly permitted  any
          liens  to  arise  on  any  of its assets nor  sold,  transferred,
          disposed  of,  assigned, dealt with or parted with possession  of
          its assets or any part thereof,
12

     PROVIDED ALWAYS THAT the Vendor shall not be held responsible for  any
     matters  which occurred prior to it assuming control of the management
     of the Company from 1st January 1995.

7.2  The Vendor further covenants with the Purchaser as follows:-

     (a)  that  the  Vendor shall not directly or indirectly,  without  the
          consent  in  writing of the Purchaser, carry on or be engaged  in
          any  business  similar  to  or in competition  with  the  present
          business undertaken by the Company for a period of five (5) years
          from the date of execution of this Agreement;

     (b)  that  the Vendor shall not for the period of five (5) years  from
          the  date of execution of this Agreement hire or employ  six  (6)
          employees  of  the  Company to be named by the  Purchaser  within
          seven (7) days from the date of this Agreement;

8.   REPRESENTATIONS, WARRANTIES AND COVENANTS BY THE PURCHASER

8.1  The  Purchaser  hereby  represents, warrants and  covenants  with  the
     Vendor that:-

     (a)  the  Purchaser  is a public listed company duly  incorporated  in
          Delaware and validly existing under the laws of the United States
          of America;

     (b)  the  Purchaser  has  the power and authority to  enter  into  and
          execute this Agreement to acquire the said Shares from the Vendor
          and  this  Agreement constitutes a legally binding obligation  on
          the Purchaser enforceable against it in accordance with the terms
          herein contained;

     (c)  the  Purchaser has obtained all necessary approvals (governmental
          and/or otherwise) to enter into this Agreement.

8.2  The Purchaser further covenants with the Vendor as follows:-

     (a)  the  Purchaser shall use their best endeavours to appoint Mr  Lim
          Si  Boon  to  the  board of directors of the Purchaser  upon  the
          execution of this Agreement;

     (b) the Purchaser acknowledges that Harpers Trading Sdn Bhd (Harpers),
          a subsidiary of the Vendor, has been the purchasing agent for the
          Company.  In  consideration of Harpers  agreeing  to  voluntarily
          terminate  the  said agency and a covenant by the Vendor  not  to
          compete with the Company for the period of 5 years
13

          from  the  date  of this agreement, the Purchaser  undertakes  to
          procure  that the Company shall compensate the Vendor  a  sum  of
          RM4,000,000.00  payable in 4 equal instalments of  RM1,000,000.00
          each  every 6 months starting 1st July 2000. The Purchaser agrees
          to use its best endeavors to pay the amount due in advance if the
          Company's cash flow permits.

9.   MUTUAL COVENANTS

     The parties  agree that the currency used for purposes of the sale and
     purchase  of the said Shares under this Agreement shall be  in  United
     States Dollars (US$).

10.  LIABILITY FOR TAX ON DISPOSAL

     The Vendor hereby undertakes to bear and pay all taxes (if any) on the
     disposal  of  the  said  Shares  and shall  keep  the  Purchaser,  its
     successors in title and permitted assigns and each of them indemnified
     in respect thereof.

11.  DEFAULT BY THE VENDOR

11.1 If  the Vendor fails to deposit the share certificates as described in
     Clause 5.2 above the Vendor is entitled to an extension of 30 days.

11.2 In the event that after the extension of 30 days, the Vendor is unable
     to deliver all the remaining shares, the Purchaser shall be obliged to
     accept  the  amount so delivered and this inability by the  Vendor  to
     deliver  shall not constitute a breach on the part of the  Vendor  and
     the Purchaser is deemed to have paid the balance of the purchase price
     in  accordance  with  Clause 4.1(a) above and  the  Stakeholder  shall
     return the 500,000 Hitox shares to the Purchaser.

11.3 Notwithstanding  the above, at any time when the  Vendor  is  able  to
     obtain the remaining undelivered shares, the Vendor shall first  offer
     such  shares to the Purchaser in exchange for the 500,000 Hitox shares
     or  for  a  cash  payment of United States Dollars One  Million  Three
     Hundred  and  Seventy Five Thousand (US$1,375,000.00).  The  Purchaser
     shall have the right to accept or refuse such late delivery of shares.

12.  INTERPRETATION

12.1 The  headings in this Agreement are inserted for convenience only  and
     shall  not  be  taken, read or construed as essential  parts  of  this
     Agreement.
14

12.2 Words  importing the masculine gender shall include the  feminine  and
     neuter  gender  and  vice versa. Words importing the  singular  number
     shall include the plural number and vice versa.

12.3 Where two or more persons or parties are included or comprised in  any
     expression,    agreements,   covenants,   terms,   stipulations    and
     undertakings expressed to be made to such persons shall be enforceable
     by  such  persons  or  parties jointly and severally  and  agreements,
     covenants, terms, stipulations and undertakings expressed to  be  made
     by  or  on the part of such persons or parties shall be deemed  to  be
     made  by  and  binding  upon  such  persons  or  parties  jointly  and
     severally.

13.  GENERAL

13.1 Time shall be of the essence of this Agreement.

13.2 The  invalidity or unenforceability of any term or provision  of  this
     Agreement shall not affect the validity or enforceability of the other
     terms and provisions herein contained which shall remain in full force
     and effect PROVIDED THAT such invalidity or unenforceability shall not
     substantially  nullify  the underlying intent of  this  Agreement  AND
     PROVIDED  THAT  the  invalid  or  unenforceable  provision  shall   be
     severable.

13.3 Any waiver by either party or a breach of any terms and conditions  of
     this  Agreement shall not constitute a waiver of any subsequent breach
     of  the  same  terms and conditions or any other term or condition  of
     this Agreement.

13.4 This  Agreement shall be governed by and construed in English  and  in
     accordance with the laws of Malaysia.

13.5 Any notice required to be served on the parties hereto shall be served
     personally or sent by prepaid registered post and any notice  required
     to be served shall be sufficiently served if served personally or left
     at  the  addresses above stated and any notice sent by post  shall  be
     deemed to have been given at the time when it ought to be delivered in
     due course in the post.

13.6 The  Purchaser  shall  bear  the costs of  stamp  duty  (if  any)  and
     registration  fees (if any) chargeable in respect of the  transfer  of
     the said Shares. Each party shall bear its own solicitors' cost.

13.7 This  Agreement shall be binding upon the respective permitted assigns
     and successors-in-title of the parties hereto.

                             ****************
15

     IN  WITNESS  WHEREOF the parties hereto have hereunto set their  hands
the day and year first above written.

The Vendor

Signed by Dato Lim Keng Kay   )              KENG KAY LIM
for and on behalf of          )          --------------------
MEGAMIN VENTURES SDN BHD      )              Keng Kay Lim
(20827-A) in the presence of:-)

The Purchaser

Signed by Bernard A. Paulson  )           BERNARD A. PAULSON
for and on behalf of          )          --------------------
HITOX CORPORATION OF AMERICA  )           Bernard A. Paulson
in the presence of:-          )
16

                                                               Exhibit 10.1

                     THIRD AMENDMENT TO LOAN AGREEMENT

     This  is  a  Third  Amendment to a Loan Agreement by and  among  HITOX
CORPORATION OF AMERICA, INC., a Delaware corporation ("Borrower") and  BANK
OF  AMERICA, N.A., a national banking association which is the successor in
interest by merger to NationsBank of Texas, N.A. ("Bank").

     Borrower has entered into a Loan Agreement with Bank dated August  31,
1995,  which has been amended by a First Amendment to Loan Agreement  dated
July  31, 1996 and a Second Amendment to Loan Agreement dated July 17, 1998
(as  amended,  the  "Loan Agreement").  Words which are capitalized  herein
which are defined in the Loan Agreement shall have the same meanings as  in
the  Loan  Agreement.  Borrower has requested Bank to lend it an additional
$3,500,000,  which  Bank is willing to do on the terms and  conditions  set
forth herein.

     NOW, THEREFORE, for valuable consideration, Borrower and Bank mutually
agree that the Loan Agreement shall be, and is hereby, amended as follows:

     AMENDMENT TO SECTION I.  Section I of the Loan Agreement is amended in
its entirety to read as follows:

          1.1     REVOLVING  LINE  OF  CREDIT.   Bank  has  established   a
     revolving line of credit for loans to be made to Borrower and  letters
     of  credit  to be issued at the request of Borrower which is evidenced
     by  the  promissory note maturing April 30, 2000 which is attached  as
     Exhibit   A,  to  which  reference  is  here  made  for  all  purposes
     ("Revolving  Note").   The total amount of all loans  and  letters  of
     credit  outstanding under the Revolving Note may  vary  from  time  to
     time, but shall not exceed in the aggregate at any one time the lesser
     of   (a)  $2,000,000  or  (b)  80%  of  Borrower's  Eligible  Accounts
     Receivable.   For  purposes  of  this  calculation  only,   Borrower's
     "Eligible  Accounts  Receivable" shall mean those accounts  receivable
     for  services  actually  performed  and/or  goods  actually  sold  and
     delivered,  which are invoiced and owing to Borrower, other  than  (1)
     receivables   from   Borrower's   officers,   directors,    employees,
     stockholders or affiliates, (2) receivables that are subject to offset
     or  credit,  (3) receivables from customers which Bank has determined,
     in  its sole discretion, not to be credit-worthy, (4) receivables that
     are  contingent or are disputed by customers, and (5) receivables from
     customers where at least 10% of one or more invoices is more  than  60
     days past the date of original invoice (or 120 days if the invoice  is
     secured by a letter of credit).
17

          1.2.    BORROWING BASE COMPLIANCE.  Borrower agrees to deliver to
     Bank  a Borrowing Base Certificate in the form attached as Exhibit  B,
     stating the information set forth therein as of the date thereof,  (a)
     upon each request for an advance on the Revolving Note and (b) 20 days
     after  the end of each month, showing the information as of  the  last
     day  of  the  preceding  month.  If the  total  amount  of  all  loans
     (including  any  letter of credit obligations) outstanding  under  the
     Revolving Note exceeds the amount authorized, Borrower agrees that  it
     will  promptly  (1)  pay  Bank  an amount  sufficient  to  reduce  the
     outstanding balance on the Revolving Note to an amount which does  not
     exceed the authorized amount, or (2) increase the amount of assets  in
     the Borrowing Base calculation to the extent necessary to increase the
     authorized  amount above the total aggregate amount of all  loans  and
     letter  of credit obligations outstanding under the Revolving Note  at
     such time.

          1.3.     LETTER OF CREDIT OBLIGATIONS.  Bank agrees to issue  its
     irrevocable  standby  letters of credit under the  Revolving  Note  as
     requested  by Borrower, for a fee of 2.0% of the amount of the  credit
     per  annum, with a minimum charge of $300 plus Bank's standard charges
     for  amendments, telex, document against said letters of credit  shall
     be  considered as loans for all purposes under the Revolving Note from
     and after the date of issuance.

          1.4.     REVOLVING  LOAN  COMMITMENT FEE.  In  consideration  for
     Bank's commitment to maintain $2,000,000 available for advances  under
     the  Revolving Note, Borrower agrees to pay Bank a Commitment  Fee  of
     0.25%  per  annum on the difference between the Requested Availability
     Amount  and  the  average amount of the advances  (including  unfunded
     letter  of  credit  obligations) made during  the  preceding  quarter,
     calculated and invoiced to Borrower following each March 31, June  30,
     September  30  and  December 31, which shall be due and  payable  upon
     receipt.   Borrower's  Requested  Availability  Amount  shall  be  (a)
     $2,000,000 or (b) if such a letter is given, any lesser amount  stated
     by  Borrower  in letter delivered to Bank at least ten days  prior  to
     each  March 31, June 30, September 30 or December 31 stating a maximum
     amount  to  be  available  for  loans and  letters  of  credit  to  be
     outstanding  under  the  Revolving Note  during  the  next  succeeding
     quarter  and,  until  a  subsequent letter is  given,  all  successive
     quarters  thereafter.  Borrower shall not be entitled to borrow  funds
     or  obtain  letters  of credit which, with all previously  outstanding
     loans  and  letters  of credit outstanding at that  time,  exceed  the
     Requested   Availability  Amount  as  so  designated.   The  Requested
     Availability Amount may be increased by Borrower during such  quarter,
     but  in that event the Commitment Fee shall be calculated on the basis
     of  the  higher  Requested Availability Amount for the entire  quarter
     times 110%.
18

          1.5.     TERM  LOAN.  Bank agrees to lend  Borrower  the  sum  of
     $3,500,000, which shall be evidenced by the promissory note  which  is
     attached  as  Exhibit  C, to which reference  is  here  made  for  all
     purposes  ("Term Note").  Notwithstanding paragraph 2  of  the  Second
     Amendment  to  Loan  Agreement, the Term Note and the  Revolving  Note
     shall be secured by the collateral described in Section II of the Loan
     Agreement.

          1.6.     TERM  LOAN COMMITMENT FEE.  In consideration for  Bank's
     commitment  to  make the Term Loan to Borrower to enable  Borrower  to
     purchase  the  Malaysian Titanium Corporation or its assets,  Borrower
     agrees to pay Bank a commitment fee of $8,750 at closing.

          1.7.    LOANS.  The provisions of this Loan Agreement shall apply
     to  the  Revolving  Note  and the Term Note,  to  any  extensions  and
     renewals thereof, and to any other loans which may hereafter  be  made
     to  Borrower  by  Bank.  Said loans (including the  letter  of  credit
     obligations)  are  collectively  referred  to  as  "Loans",  and  each
     separately  as  a  "Loan",  herein.  The promissory  notes  which  are
     attached  as  Exhibits  A and C and all other  promissory  notes  from
     Borrower  to  Bank are collectively referred to as "Notes",  and  each
     separately as a "Note", herein.

          1.8.     NO OBLIGATION TO RENEW.  Bank shall not be obligated  to
     renew  or  extend the time for payment of any Note beyond the maturity
     date  stated therein.  If a Note is not renewed at maturity,  Borrower
     will be required to pay the obligation out of other assets, or will be
     required to find another lender who is willing to refinance the  debt.
     Any  refinancing will be at the then prevailing market rate, which may
     be  higher than the current rate.  Also, there is no guaranty that the
     obligation can be refinanced on any basis.  If a Note is refinanced or
     renewed,  Borrower  may  also be required to  pay  additional  closing
     costs,  or  be  required  to provide additional  collateral  and/or  a
     current  appraisal, survey, title policy or other supporting  data  on
     the existing Collateral.

     2.    Deletion of Paragraph 2.1.  Paragraph 2.1 of the Loan  Agreement
is amended to delete subparagraph 2.1(b) in its entirety.

     3.    Amendment to Paragraph 4.3.  Paragraph 4.3 of the Loan Agreement
is amended to read as follows:
19

          4.3   ANNUAL  FINANCIAL STATEMENTS.  Borrower agrees  to  furnish
     Bank, (a) within 120 days after the close of each fiscal year, with  a
     copy of (i) Borrower's annual consolidated and consolidating financial
     statements,  audited by an independent certified public accountant  or
     accounting  firm selected by Borrower and satisfactory to Bank,  which
     financial statements shall include balance sheets as of the end of the
     year  and profit and loss statements reflecting operations during  the
     year,  including statements of financial condition, income, cash flows
     and  changes  in  shareholders' equity,  all  of  which  shall  be  in
     reasonable  detail  and  shall set forth comparable  figures  for  the
     preceding year, (ii) Borrower's annual report to its shareholders  and
     (iii)  the  independent  auditor's  letter  to  Borrower's  board   of
     directors,  (b)  within 60 days after the close of each  fiscal  year,
     with  copies  of Borrower's pro forma balance sheet, income  statement
     and  cash  flow statement for the next year, and (c) if  requested  by
     Bank,  with copies of their federal income tax returns within 10  days
     after filing the same.

     4.    Amendment to Paragraph 4.4.  Paragraph 4.4 of the Loan Agreement
is amended to read as follows:

          4.4.  Monthly  and Quarterly Financial Statements and  Compliance
     Certificates.  Borrower agrees to furnish Bank, within 30  days  after
     the  end of each month, with a copy of Borrower's monthly consolidated
     and consolidating financial statements, certified by the president  or
     chief  financial officer of Borrower, which financial statements shall
     include (a) balance sheets as of the end of the month, (b) profit  and
     loss  statements reflecting operations during the month, (c) a listing
     of  the  inventory in Borrower's possession at the end of  the  month,
     showing the product description, quantities and value at the lower  of
     cost or market and (d) an aged list of accounts receivable owed to Bor
     rower  at the end of the month.  In addition, Borrower also agrees  to
     furnish  Bank,  within  60  days after each  March  31,  June  30  and
     September  30, and within 90 days after each December 31, with  (i)  a
     Compliance  Certificate, completed and with supporting  data,  in  the
     form  which  is attached as Exhibit D, (ii) with a copy of  Borrower's
     quarterly report to its shareholders and (iii) a copy of Borrower's 10-
     Q  report  filed  with  the  Securities and Exchange  Commission.   In
     addition, Borrower further agrees to furnish Bank with copies of  each
     press  release  issued by Borrower, within 48 hours  of  the  date  of
     issue.

     5.    Amendment to Paragraph 4.5.  Paragraph 4.5 of the Loan Agreement
is amended to read as follows:
20

          4.5   NOTICE  OF  DEFAULT  OR  LITIGATION.   Borrower  agrees  to
     promptly  notify  Bank  in writing of (a) the institution  of  or  any
     adverse  determination in any litigation, arbitration or  governmental
     proceeding  filed  by or against Borrower, (b) the occurrence  of  any
     event  which  would  constitute an Event of Default  under  this  Loan
     Agreement, (c) any uninsured or partially uninsured loss through fire,
     theft,  liability or property damage, and (d) any condition, event  or
     act   that  would  or  might  adversely  affect  Borrower's  financial
     condition  to the extent of $250,000 or more or Borrower's operations,
     the  Collateral or Bank's rights under the Loan Agreement,  Notes,  or
     Security Documents, describing the same and the steps being taken with
     respect thereto.

     6.    Amendment  to  Paragraph  4.10.   Paragraph  4.10  of  the  Loan
Agreement is amended to read as follows:

          4.10.  ADDITIONAL  DEBT, CAPITAL ACQUISITIONS.   Borrower  agrees
     that it will not incur, assume, guaranty or become contingently liable
     for   the   payment  of  any  indebtedness  or  liability   (including
     capitalized leases), other than (a) the Loans, (b) open account  trade
     indebtednesses which are incurred in the ordinary course  of  business
     (which  shall be paid when due), (c) existing indebtednesses disclosed
     to  Bank in writing and acknowledged by Bank prior to the date hereof,
     and  (d)  tax  obligations (which shall be paid when  due).   Borrower
     agrees  that it will not expend any funds for capital acquisitions  in
     excess  of  $1,250,000 per year without the prior written approval  of
     Bank, whose consent shall not be unreasonably withheld.

     7.    Amendment  to  Paragraph  4.13.   Paragraph  4.13  of  the  Loan
Agreement is amended to read as follows:

          4.13. Loans to Entities; Guaranties.  Borrower agrees it will not
     (a)  lend  funds to any one or more persons or entities in  excess  of
     $1,000 per individual or (b) lend funds of more than $1,000,000 in the
     aggregate to Malaysian Titanium Corporation.  Borrower agrees that  it
     will  not  guarantee the payment or performance of any debt  or  other
     obligation of any subsidiary or any other entity.

     8.  Amendment to Paragraph 4.16.  Paragraph 4.16 of the Loan Agreement
is amended to read as follows:
21

          4.16.  Existence,  Compliance and Business Operations.   Borrower
     agrees  that  it  will  maintain  its  existence,  good  standing  and
     qualification  to  do  business,  and  will  comply  with  all   laws,
     regulations and governmental requirements applicable to it or  to  any
     of  its property, business operations and transactions, including  but
     not  limited  to  the Occupational Safety and Health Act  (OSHA),  the
     Employee  Retirement Income Security Act (ERISA) and the Environmental
     Protection  Act  (EPA).  Borrower agrees that it will not  change  the
     general  character  of business as conducted on the  date  hereof,  or
     engage  in any type of business not reasonably related to its business
     as presently conducted.

     9.    Amendments to Paragraphs 4.19, 4.20, and4.21.  Paragraphs  4.19,
420 and 4.21 of the Loan Agreement are amended to read as follows:

          4.19  RATIO  OF CURRENT ASSETS TO CURRENT LIABILITIES.   Borrower
     agrees  that  it  will maintain a ratio of current assets  to  current
     liabilities of not less than 2.5 to 1.0, on an unconsolidated basis.

          4.20  RATIO OF TOTAL DEBT TO TANGIBLE NET WORTH.  Borrower agrees
     that it will maintain a ratio of total debt tangible net worth, on  an
     unconsolidated basis, of not more than 2.5 to 1.0  on each  March  31,
     June  30,  September  30  and  December 31,.   For  purposes  of  this
     calculation,  Borrower's total debt shall mean all of its liabilities,
     and  Borrower's  tangible net worth shall mean  Borrower's  net  worth
     minus all intangible assets.

          4.21.   FUNDED  DEBT  COVERAGE.  Borrower  agrees  that  it  will
     maintain a funded debt coverage ratio, on an unconsolidated basis,  of
     no  greater than (a) 4.0 to 1.0 on March 31, 2000, (b) 3.0 to  one  on
     September  30, 2000, and (c) 1.5 to one on December 31,  2000  and  on
     each March 31, June 30, September 30 and December 31 thereafter, based
     on  the  four  immediately preceding quarters.  For purposes  of  this
     calculation, Borrower's funded debt coverage shall mean that ratio  of
     Borrower's  funded  debt to Borrower's cash flow.   Borrower's  funded
     debt  shall include the principal amount of all outstanding promissory
     notes and capital lease obligations.   Borrower's cash flow shall mean
     Borrower's  net  income  after taxes on a book  basis  (a)   plus  (i)
     interest expense, (ii) depreciation and amortization, (iii) other non-
     cash  expenses and (iv) lease expenses, (b) less gains on the sale  of
     assets and cash dividends.

     10.  Deletion of Paragraph 4.22.  Paragraph 4.22 of the Loan Agreement
is deleted in its entirety.
22

     11.   FINANCIAL STATEMENTS; LITIGATION.  Borrower represents  to  Bank
that all financial statements which have been furnished to Bank are correct
and  complete in all material respects, and fairly represent the  financial
condition  of  Borrower on the dates thereof or for the  periods  specified
therein, and that no material adverse change has occurred since the date of
the  latest  of  such  financial statements.   No  litigation,  arbitration
proceedings  or  governmental  or regulatory  proceedings  are  pending  or
threatened against Borrower which, if adversely determined, would be likely
to  adversely  affect  Borrower's  financial  condition  or  the  legality,
validity  or  enforceability  of  the Loan  Agreement,  Notes  or  Security
Documents.

     12.   PRIOR DOCUMENTS.  Borrower ratifies and confirms that all of the
representations  and  warranties, covenants, events of  default  and  other
provisions  of the Loan Agreement are true and correct and remain  in  full
force  and  effect, as of the date hereof.  Borrower further  ratifies  and
confirms that all of the Security Documents shall also remain in full force
and effect until the Notes are paid in full.

     13.   RELEASE.   For  valuable  consideration  received  to  the  full
satisfaction of Borrower, Borrower waives and releases any and  all  causes
of  action  against  Bank,  its  agents and employees,  for  all  acts  and
omissions  which have occurred prior to the signing of this Third Amendment
to  Loan  Agreement, including but not limited to all causes of action  for
claims    of   usury,   fraud,   deceit,   misrepresentation,   conspiracy,
unconscionability,   duress,   economic   duress,   defamation,    control,
interference   with   corporate  governance,  tortious  interference   with
contractual  and business relationships, conflicts of interest,  misuse  of
insider   information,   concealment,  disclosure,   secrecy,   misuse   of
collateral,   wrongful   release  of  collateral,   failure   to   inspect,
environmental  due diligence, negligent loan processing and administration,
wrongful  setoff,  violations of statutes and regulations  of  governmental
entities  and agencies (both civil and criminal), racketeering  activities,
security  and  antitrust  violations, tying arrangements,  deceptive  trade
practices (to the maximum extent permitted by law), and breach or abuse  of
any  alleged fiduciary duty, special relationship, course of conduct and/or
obligation of good faith and fair dealing.  Bank and Borrower further agree
that  the amount of their damages in all causes of action, including causes
of  action  arising after the date hereof, shall be limited to exclude  all
(i)  punitive  and  exemplary damages, (ii) damages  attributable  to  lost
profits  or  opportunity, (iii) damages attributable to mental anguish  and
(iv)  damages attributable to pain and suffering, and the parties do hereby
waive  and  release all such damages with respect to any and all causes  of
action  which  may arise at any time against any other party, their  agents
and employees.
23

     14.   ARBITRATION.   ANY  CONTROVERSY OR CLAIM BETWEEN  OR  AMONG  THE
PARTIES  HERETO  INCLUDING  BUT NOT LIMITED TO  THOSE  ARISING  OUT  OF  OR
RELATING  TO  THIS  INSTRUMENT,  AGREEMENT  OR  DOCUMENT  OR  ANY   RELATED
INSTRUMENTS,  AGREEMENTS OR DOCUMENTS, INCLUDING  ANY  CLAIM  BASED  ON  OR
ARISING FROM AN ALLEGED TORT, SHALL BE DETERMINED BY BINDING ARBITRATION IN
ACCORDANCE  WITH  THE  FEDERAL ARBITRATION ACT (OR IF NOT  APPLICABLE,  THE
APPLICABLE  STATE  LAW),  THE  RULES OF  PRACTICE  AND  PROCEDURE  FOR  THE
ARBITRATION  OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR ANY  SUCCESSOR
THEREOF  ("J.A.M.S."), AND THE "SPECIAL RULES" SET  FORTH  BELOW.   IN  THE
EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL.  JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION.  ANY
PARTY  TO  THIS  INSTRUMENT, AGREEMENT OR DOCUMENT  MAY  BRING  AN  ACTION,
INCLUDING A SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION  OF  ANY
CONTROVERSY  OR CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY  COURT  HAVING
JURISDICTION OVER SUCH ACTION.

          (1)   SPECIAL RULES.  THE ARBITRATION SHALL BE CONDUCTED  IN  THE
COUNTY  OF  ANY  BORROWER'S DOMICILE AT THE TIME OF THE EXECUTION  OF  THIS
INSTRUMENT,  AGREEMENT OR DOCUMENT AND ADMINISTERED BY  J.A.M.S.  WHO  WILL
APPOINT  AN  ARBITRATOR;  IF J.A.M.S. IS UNABLE OR LEGALLY  PRECLUDED  FROM
ADMINISTERING  THE  ARBITRATION, THEN THE AMERICAN ARBITRATION  ASSOCIATION
WILL  SERVE.  ALL ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90 DAYS  OF
THE  DEMAND  FOR ARBITRATION; FURTHER, THE ARBITRATOR SHALL  ONLY,  UPON  A
SHOWING  OF CAUSE, BE PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH  HEARING
FOR UP TO AN ADDITIONAL 60 DAYS.

          (2)    RESERVATION  OF  RIGHTS.   NOTHING  IN  THIS   ARBITRATION
PROVISION  SHALL BE DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY  OTHERWISE
APPLICABLE  STATUTES OF LIMITATION OR REPOSE AND ANY WAIVERS  CONTAINED  IN
THIS INSTRUMENT, AGREEMENT OR DOCUMENT; OR (II) BE A WAIVER BY BANK OF  THE
PROTECTION  AFFORDED  TO  IT  BY 12 U.S.C. SEC.  91  OR  ANY  SUBSTANTIALLY
EQUIVALENT  STATE  LAW;  OR (III) LIMIT THE RIGHT OF  BANK  HERETO  (A)  TO
EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED TO) SETOFF, OR (B)  TO
FORECLOSE  AGAINST  ANY  REAL OR PERSONAL PROPERTY COLLATERAL,  OR  (C)  TO
OBTAIN  FROM  A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH  AS  (BUT  NOT
LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT  OF  A
RECEIVER.   BANK  MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE  UPON  SUCH
PROPERTY,  OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE,  DURING
OR  AFTER  THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT  PURSUANT  TO
THIS INSTRUMENT, AGREEMENT OR DOCUMENT.  NEITHER THIS EXERCISE OF SELF HELP
REMEDIES NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR
PROVISIONAL OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF
ANY  PARTY,  INCLUDING THE CLAIMANT IN ANY SUCH ACTION,  TO  ARBITRATE  THE
MERITS OF THE CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.
24

     15.   COMPLETE AGREEMENT.  THE WRITTEN LOAN AGREEMENT AS AMENDED,  THE
NOTES  AND  ALL CURRENTLY AND PREVIOUSLY EXECUTED SECURITY DOCUMENTS  REPRE
SENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE  OF  PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS  OF  THE
PARTIES.

 THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

     Dated: March 3, 2000.

                                   BORROWER:

                                   HITOX CORPORATION OF AMERICA, INC.

                                   By:  RICHARD L. BOWERS
                                        -----------------
                                        Richard L. Bowers,
                                        Executive Vice President

                                   BANK:

                                   BANK OF AMERICA, N.A.

                                   By:  TOM L. HUNT
                                        -----------------
                                        Tom L. Hunt,
                                        Vice President
25

                              PROMISSORY NOTE

Date:  March 3, 2000                                  Amount $3,500,000

[X] New  [ ] Renewal                    Maturity Date:  October 5, 2001

Bank:                               Borrower:

Bank of America, N.A.               Hitox Corporation of America, Inc.
Corpus Christi Downtown             722 Burleson Street
500 North Shoreline Blvd.           Corpus Christi, Texas 78469
Nueces County
Corpus Christi, Texas  78471

FOR VALUE RECEIVED, the undersigned Borrower unconditionally (and jointly
and  severally, if more than one) promises to pay to the order  of  Bank,
its  successors and assigns, without setoff, at its offices indicated  at
the  beginning of this Note, or at such other place as may be  designated
by  Bank, the principal amount of Three Million Five Hundred Thousand and
No/100  Dollars ($3,500,000), or so much thereof as may be advanced  from
time  to  time  in  immediately available funds, together  with  interest
computed  daily  on the outstanding principal balance  hereunder,  at  an
annual  interest  rate,  and  in accordance with  the  payment  schedule,
indicated below.

1.   RATE.  The interest rate shall be the Bank's Prime Rate or the LIBOR
Rate  plus  225 basis points, as provided in the Rate Addendum  which  is
attached hereto.

Notwithstanding any provision of this Note, Bank does not intend to charge
and Borrower shall not be required to pay any amount of interest or other
charges  in excess of the maximum permitted by applicable law.   Borrower
agrees that during the full term hereof, the maximum lawful interest rate
for  this Note as determined under Texas law shall be the indicated  rate
ceiling  as specified in the Texas Finance Code.  Further, to the  extent
that any other lawful rate ceiling exceeds the rate ceiling so determined
then  the higher rate ceiling shall apply.  Any payment in excess of such
maximum  shall be refunded to Borrower or credited against principal,  at
the option of Bank.

2.   ACCRUAL METHOD.  Unless otherwise indicated, interest at the Rate set
forth  above  will be calculated based on an actual year of  365  or  366
days.

3.    RATE CHANGE DATE.    Any Rate based on a fluctuating index or  base
rate will change, unless otherwise provided, each time and as of the date
that the index or base rate changes.

In  the  event any index is discontinued, Bank shall substitute an  index
determined by Bank to be comparable, in its sole discretion.

4.    PAYMENT SCHEDULE.  All payments received hereunder shall be applied
first to the payment of any expense or charges payable hereunder or under
any  other loan documents executed in connection with this Note, then  to
interest  due and payable, with the balance applied to principal,  or  in
such other order as Bank shall determine at its option.

SINGLE  PRINCIPAL PAYMENT.  Principal shall be paid in full in  a  single
payment  on  October 5, 2001.  Interest thereon shall be paid  quarterly,
commencing  on  June 3, 2000, and continuing on the  third  day  of  each
successive March, June, September and December thereafter, with  a  final
payment of all unpaid interest at the stated maturity of this Note.
26

5.   REVOLVING FEATURE.  [Not applicable]

6.   WAIVERS, CONSENTS AND COVENANTS.  Borrower, any indorser or guarantor
hereof,  or  any  other  party  hereto  (individually  an  "Obligor"  and
collectively  "Obligors")  and each of them jointly  and  severally:  (a)
waive presentment, demand, protest, notice of demand, notice of intent to
accelerate, notice of acceleration of maturity, notice of protest, notice
of  nonpayment, notice of dishonor, and any other notice required  to  be
given  under  the  law to any Obligor in connection  with  the  delivery,
acceptance,  performance,  default  or  enforcement  of  this  Note,  any
endorsement or guaranty of this Note, or any other documents executed  in
connection with this Note  or any other note or other loan documents  now
or  hereafter executed in connection with any obligation of  Borrower  to
Bank  (the  "Loan  Documents"); (b) consent to  all  delays,  extensions,
renewals  or  other modifications of this Note or the Loan Documents,  or
waivers  of  any  term  hereof or of the Loan Documents,  or  release  or
discharge  by  Bank  of  any  of Obligors, or  release,  substitution  or
exchange of any security for the payment hereof, or the failure to act on
the  part of Bank, or any indulgence shown by Bank (without notice to  or
further  assent  from any of Obligors),  and agree that no  such  action,
failure  to act or failure to exercise any right or remedy by Bank  shall
in  any  way  affect  or impair the obligations of  any  Obligors  or  be
construed  as  a waiver by Bank of, or otherwise affect,  any  of  Bank's
rights under this Note, under any endorsement or guaranty of this Note or
under  any  of the Loan Documents; and (c) agree to pay, on  demand,  all
costs  and  expenses  of collection or defense of this  Note  or  of  any
endorsement  or  guaranty  hereof and/or the enforcement  or  defense  of
Bank's  rights  with  respect  to,  or the  administration,  supervision,
preservation,  or  protection  of,  or  realization  upon,  any  property
securing   payment  hereof,  including,  without  limitation,  reasonable
attorney's  fees,  including  fees related  to  any  suit,  mediation  or
arbitration  proceeding, out of court payment agreement,  trial,  appeal,
bankruptcy  proceedings or other proceeding, in such  amount  as  may  be
determined   reasonable  by  any  arbitrator  or  court,   whichever   is
applicable.

Borrower and NationsBank of Texas, N.A. have entered into a Loan Agreement
dated   August  31, 1995, which has been amended by a First Amendment  to
Loan  Agreement dated July 31, 1996, a Second Amendment to Loan Agreement
dated July 17, 1998 and a Third Amendment to Loan Agreement of even  date
herewith (now and as hereafter amended, the "Loan Agreement").   Borrower
represents that all of the covenants in the Loan Agreement are  true  and
correct.   Borrower covenants that it will keep all of the covenants  and
agreements  set  forth  in  the  Loan Agreement.   No   waiver,  consent,
modification or amendment with respect  to this Promissory Note shall  be
effective without compliance with the provisions of Paragraph 6.4 of  the
Loan Agreement.

7.   PREPAYMENTS.  Prepayments may be made in whole or in part at any time
on  any  loan  for  which  the Rate is based  on  the  Prime  Rate.   All
prepayments  of  principal  shall be applied  in  the  inverse  order  of
maturity,  or  in such other order as Bank shall determine  in  its  sole
discretion.   No prepayment of any other loan shall be permitted  without
the prior written consent of Bank.  Notwithstanding such prohibition,  if
there  is  a prepayment of any such loan, whether by consent of Bank,  or
because  of acceleration or otherwise, Borrower shall, within 15 days  of
any request by Bank, pay to Bank any loss or expense which Bank may incur
or  sustain as a result of such prepayment, including but not limited  to
any  Breakage  Fee due to payment before the end of the  then  applicable
LIBOR Interest Period.  For the purposes of calculating the amounts  owed
only, it shall be assumed that Bank actually funded or committed to  fund
the  loan through the purchase of an underlying deposit in an amount  and
for  a  term comparable to the loan, and such determination by Bank shall
be conclusive, absent a manifest error in computation.
27

8.   EVENTS OF DEFAULT. The occurrence of any Event of Default specified in
Paragraph  5.1  of  the  Loan Agreement, unless  cured  within  the  time
specified  therein,  shall  constitute an Event  of  Default  under  this
Promissory Note. The following are also events of default hereunder:  (a)
the  failure  to pay or perform any obligation, liability or indebtedness
of  any  Obligor to Bank, or to any affiliate or subsidiary  of  Bank  of
America  Corporation, whether under this Note or any Loan  Documents,  as
and  when due (whether upon demand, at maturity or by acceleration);  (b)
the  failure  to  pay  or  perform  any other  obligation,  liability  or
indebtedness  of  any Obligor to any other party; (c) the  death  of  any
Obligor  (if  an  individual); (d) the resignation or withdrawal  of  any
partner or a material owner/guarantor of Borrower, as determined by  Bank
in  its sole discretion; (e) the commencement of a proceeding against any
Obligor  for  dissolution  or liquidation, the voluntary  or  involuntary
termination  or dissolution of any Obligor or the merger or consolidation
of  any  Obligor with or into another entity; (f) the insolvency of,  the
business  failure of, the appointment of a custodian, trustee, liquidator
or  receiver  for or for any of the property of, the assignment  for  the
benefit  of  creditors by, or the filing of a petition under  bankruptcy,
insolvency  or  debtor's relief law or the filing of a petition  for  any
adjustment  of indebtedness, composition or extension by or  against  any
Obligor;  (g)  the  determination  by Bank  that  any  representation  or
warranty  made to Bank by any Obligor in any Loan Documents or  otherwise
is  or  was, when it was made, untrue or materially misleading;  (h)  the
failure  of  any  Obligor  to timely deliver such  financial  statements,
including   tax   returns,  other  statements  of  condition   or   other
information, as Bank shall request from time to time; (i) the entry of  a
judgment against any Obligor which Bank deems to be of a material nature,
in  Bank's  sole  discretion; (j) the seizure or forfeiture  of,  or  the
issuance  of  any writ of possession, garnishment or attachment,  or  any
turnover order for any property of any Obligor; (k) the determination  by
Bank  that it is insecure for any reason; (l) the determination  by  Bank
that a material adverse change has occurred in the financial condition of
any Obligor; or (m) the failure of Borrower's business to comply with any
law or regulation controlling its operation.

9.   REMEDIES UPON DEFAULT.  The effect of the occurrence of any Event of
Default under this Promissory Note shall be as specified in Paragraph 5.2
of  the Loan Agreement.  In addition, upon the occurrence of an Event  of
Default which is not cured within the time specified therein, the Rate of
Interest on this Promissory Note shall be increased, from and after  such
date,  to   the  Prime Rate plus three percent (3.0%) per annum,  not  to
exceed  the  maximum  rate  allowed by law   (the  "Default  Rate").  The
provisions  herein for a Default Rate shall not be deemed to  extend  the
time  for any payment hereunder or to constitute a "grace period"  giving
Obligors a right to cure any default.  At Bank's option, any accrued  and
unpaid  interest,  fees  or charges may, for purposes  of  computing  and
accruing interest on a daily basis after the due date of the Note or  any
installment  thereof,  shall be deemed to be  a  part  of  the  principal
balance, and interest shall accrue on a daily compounded basis after such
date  at  the  Default  Rate  provided in  this  Note  until  the  entire
outstanding  balance of principal and interest is paid in full.   Upon  a
default  under this Note, Bank is hereby authorized at any time,  at  its
option  and  without notice or demand, to set off and charge against  any
deposit  accounts  of  any  Obligor (as well as any  money,  instruments,
securities,  documents, chattel paper, credits, claims,  demands,  income
and  any  other property, rights and interests of any Obligor), which  at
any  time shall come into the possession or custody or under the  control
of  Bank or any of its agents, affiliates or correspondents, any and  all
obligations due hereunder.  Additionally, Bank shall have all rights  and
remedies  available  under each of the Loan Documents,  as  well  as  all
rights and remedies available at law or in equity.
28

10.   NON-WAIVER.  The failure at any time of Bank to exercise any of its
options  or  any  other rights hereunder shall not  constitute  a  waiver
thereof,  nor shall it be a bar to the exercise of any of its options  or
rights  at  a  later  date.  All rights and remedies  of  Bank  shall  be
cumulative  and may be pursued singly, successively or together,  at  the
option of Bank.  The acceptance by Bank of any partial payment shall  not
constitute a waiver of any default or of any of Bank's rights under  this
Note.   No waiver of any of its rights hereunder, and no modification  or
amendment  of  this Note, shall be deemed to be made by Bank  unless  the
same shall be in writing, duly signed on behalf of Bank; each such waiver
shall  apply  only  with respect to the specific instance  involved,  and
shall  in no way impair the rights of Bank or the obligations of Borrower
to Bank in any other respect at any other time.

11.  APPLICABLE LAW, VENUE AND JURISDICTION. This Promissory Note shall be
subject  to  all  of  the  provisions of the Loan Agreement  relating  to
applicable  law,  venue and jurisdiction, including but  not  limited  to
Paragraphs 6.11 through 6.14 thereof.

12.   PARTIAL  INVALIDITY.  The unenforceability  or  invalidity  of  any
provision of this Note shall not affect the enforceability or validity of
any  other provision herein and the invalidity or unenforceability of any
provision  of  this  Note  or  of the Loan Documents  to  any  person  or
circumstance  shall  not affect the enforceability or  validity  of  such
provision as it may apply to other persons or circumstances.

13.   BINDING EFFECT.  This Note shall be binding upon and inure  to  the
benefit  of  Borrower, Borrower and Bank and their respective successors,
assigns, heirs and personal representatives, provided, however,  that  no
obligations  of  Borrower or Borrower hereunder can be  assigned  without
prior written consent of Bank.

14.  CONTROLLING DOCUMENT.  To the extent that this Note conflicts with or
is  in  any way incompatible with any other document related specifically
to the loan evidenced by this Note, the Loan Agreement shall control over
any  other  such document, and if the Loan Agreement does not address  an
issue, then this Note and such other document shall control to the extent
that it deals most specifically with an issue.

15.   ARBITRATION.  ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES
HERETO  INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING  TO
THIS  INSTRUMENT,  AGREEMENT  OR DOCUMENT  OR  ANY  RELATED  INSTRUMENTS,
AGREEMENTS OR DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM  AN
ALLEGED  TORT,  SHALL BE DETERMINED BY BINDING ARBITRATION IN  ACCORDANCE
WITH  THE  FEDERAL ARBITRATION ACT (OR IF NOT APPLICABLE, THE  APPLICABLE
STATE  LAW),  THE RULES OF PRACTICE AND PROCEDURE FOR THE ARBITRATION  OF
COMMERCIAL  DISPUTES  OF  J.A.M.S./ENDISPUTE  OR  ANY  SUCCESSOR  THEREOF
("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW.  IN THE  EVENT  OF
ANY  INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL.  JUDGMENT  UPON  ANY
ARBITRATION  AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION.   ANY
PARTY  TO  THIS  INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING  AN  ACTION,
INCLUDING A SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY
CONTROVERSY OR CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT  HAVING
JURISDICTION OVER SUCH ACTION.

A.    SPECIAL RULES.  THE ARBITRATION SHALL BE CONDUCTED IN THE COUNTY OF
ANY  BORROWER'S DOMICILE AT THE TIME OF THE EXECUTION OF THIS INSTRUMENT,
AGREEMENT  OR DOCUMENT AND ADMINISTERED BY J.A.M.S. WHO WILL  APPOINT  AN
ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING
THE  ARBITRATION, THEN THE AMERICAN ARBITRATION ASSOCIATION  WILL  SERVE.
ALL  ARBITRATION HEARINGS WILL BE COMMENCED WITHIN 90 DAYS OF THE  DEMAND
FOR  ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY, UPON A  SHOWING  OF
CAUSE, BE PERMITTED TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP  TO
AN ADDITIONAL 60 DAYS.
29

B.   RESERVATION OF RIGHTS.  NOTHING IN THIS ARBITRATION PROVISION SHALL BE
DEEMED  TO  (I)  LIMIT  THE  APPLICABILITY OF  ANY  OTHERWISE  APPLICABLE
STATUTES  OF  LIMITATION  OR  REPOSE AND ANY WAIVERS  CONTAINED  IN  THIS
INSTRUMENT,  AGREEMENT OR DOCUMENT; OR (II) BE A WAIVER BY  BANK  OF  THE
PROTECTION  AFFORDED  TO  IT BY 12 U.S.C. SEC. 91  OR  ANY  SUBSTANTIALLY
EQUIVALENT  STATE  LAW; OR (III) LIMIT THE RIGHT OF BANK  HERETO  (A)  TO
EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED TO) SETOFF,  OR  (B)
TO  FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY COLLATERAL, OR (C) TO
OBTAIN  FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH AS  (BUT  NOT
LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT OF A
RECEIVER.   BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON  SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING
OR  AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT  TO
THIS  INSTRUMENT, AGREEMENT OR DOCUMENT.  NEITHER THIS EXERCISE  OF  SELF
HELP  REMEDIES  NOR  THE  INSTITUTION OR MAINTENANCE  OF  AN  ACTION  FOR
FORECLOSURE  OR  PROVISIONAL  OR ANCILLARY REMEDIES  SHALL  CONSTITUTE  A
WAIVER  OF  THE RIGHT OF ANY PARTY, INCLUDING THE CLAIMANT  IN  ANY  SUCH
ACTION,  TO  ARBITRATE THE MERITS OF THE CONTROVERSY OR CLAIM OCCASIONING
RESORT TO SUCH REMEDIES.

Borrower represents to Bank that the proceeds of this loan are to be used
primarily  for  business, commercial or agricultural purposes.   Borrower
acknowledges having read and understood, and agrees to be bound  by,  all
terms and conditions of this Note.

NOTICE OF FINAL AGREEMENT:

THE  WRITTEN  LOAN  AGREEMENT, THIS PROMISSORY NOTE AND  ALL  OTHER  LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES, AND MAY  NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS  OF  THE  PARTIES.   THERE ARE NO  UNWRITTEN  ORAL  AGREEMENTS
BETWEEN THE PARTIES.

Bank:                                 Borrower:

BANK OF AMERICA, N.A.                 HITOX CORPORATION OF AMERICA, INC.

By: TOM L. HUNT                       By: RICHARD L. BOWERS
    ------------                          -----------------
    Tom L. Hunt                           Richard L. Bowers
    Vice President                        Executive Vice President
30

                               RATE ADDENDUM

     This  Addendum  is  attached  to and  made  a  part  of  that  certain
Promissory Note ("Note") in the amount of $3,500,000, dated March 3,  2000,
executed by Hitox Corporation of America, Inc. ("Borrower") and payable  to
the order of Bank of America, N.A. ("Bank").

     1.    Pre-Maturity  Interest  Rate.   At  the  election  of  Borrower,
Borrower will have the option, to be exercised at the time of each  request
for  an Advance on this Note, of choosing between one of two interest  rate
formulas  for  interest to accrue on the principal being  so-advanced  (the
"Pre-Maturity Interest Rate on the Advance").

          a.    Prime Rate Option.  Borrower may choose as the Pre-Maturity
Interest Rate on the Advance (a "Prime Rate Option Advance") a varying rate
per  annum  which shall be equal to the lesser of (a) the  Prime  Rate  (as
herein defined), such varying rate to change automatically, effective as of
the  date of each change in the Prime Rate, to reflect such change  in  the
Prime  Rate  without  notice to Borrower or any other person,  or  (b)  the
maximum  rate  permitted  by  applicable  law  (the  "Maximum  Rate"),   as
hereinafter limited (the "Prime Rate Option").

          b.    LIBOR  Rate Option.  Alternatively, Borrower may choose  as
the  Pre-Maturity  Interest  Rate on the  Advance  (a  "LIBOR  Rate  Option
Advance") the LIBOR Rate plus 225 basis points (the "Interest Rate Margin")
(the "LIBOR Rate Option").

     2.   Prepayment.

          a.   Prime Rate Option.  Principal advanced pursuant to the Prime
Rate Option may be prepaid at any time.

          b.    LIBOR Rate Option.  No prepayment of any LIBOR Rate  Option
Advance  shall  be  permitted without the prior written  consent  of  Bank.
Notwithstanding such prohibition, if there is any prepayment of  any  LIBOR
Rate Option Advance, whether by consent of Bank, or because of acceleration
or otherwise, Borrower shall, within 15 days of any request by Bank, pay to
Bank  the Breakage Fee as provided in the Loan Agreement, but not to exceed
the maximum permissible by applicable law.  For the purposes of calculating
the  amounts  owed only, it shall be assumed that Bank actually  funded  or
committed  to  fund the amount of the Advance through the  purchase  of  an
underlying  LIBOR  deposit in an amount, and for a term comparable  to  the
Advance under the LIBOR Rate Option, and such determination by Bank will be
conclusive, absent a manifest error in computation.
31

     3.   LIBOR Rate Terminology.  The following are definitions of various
terms used in conjunction with the LIBOR Rate Option.

          a.    "LIBOR Rate" shall mean an interest rate per annum equal to
a rate determined pursuant to the following formula:

                              Eurodollar Rate
                              ---------------
                   100% - Eurodollar Reserve Percentage

          b.    "Eurodollar  Reserve  Percentage" shall  mean  the  maximum
reserve   requirement   (including,   without   limitation,   any    basic,
supplemental, marginal and emergency reserves) (expressed as a  percentage)
applicable  to  member banks of the Federal Reserve System  in  respect  of
"Eurocurrency Liabilities" under Regulation D of the board of Governors  of
the  Federal  Reserve  System, or such additional, substituted  or  amended
reserve requirement as may be hereafter applicable to member banks  of  the
Federal Reserve System.

          c.    "Eurodollar  Rate" shall mean for the  applicable  Interest
Period,  the  rate of interest per annum (rounded upward, if necessary,  to
the  nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any successor
page)  as  the  London interbank offered rate for deposits  in  Dollars  at
approximately 11:00 a.m. (London time) two Business Days prior to the first
day  of such Interest Period for a term comparable to such Interest Period.
If  for  any reason such rate is not available, the term "Eurodollar  Rate"
shall  mean, for any Eurodollar Loan for any Interest Period therefor,  the
rate per annum (rounded upwards, if necessary, to the nearest 1/100 of  1%)
appearing on Reuters Screen LIBOR Page as the London interbank offered rate
for  deposits  in  Dollars at approximately 11:00 a.m.  (London  time)  two
Business  Days prior to the first day of such Interest Period  for  a  term
comparable  to  such Interest Period; provided, however, if more  than  one
rate  is specified on Reuters Screen LIBOR Page, the applicable rate  shall
be the arithmetic mean of all such rates.

     If  no  such offers or quotes are generally available for such amount,
then  Bank shall be entitled to determine the Eurodollar Rate by estimating
in  its  reasonable judgment the per annum rate (as described  above)  that
would be applicable if such quotes or offers were generally available.
32

          d.   "Interest Period" means, for each LIBOR Rate Option Advance,
a  period of 30 days, commencing in the first instance on the first date of
the first LIBOR Rate Option Advance under the Note and ending 30 days after
that  date,  and  then each successive 30 day period thereafter;  provided,
however,  that Borrower shall be entitled to change the Interest Period  to
60 days or 90 days, but only if Borrower furnishes Bank with written notice
delivered  at  least  two business days prior to  the  final  date  of  the
Interest Period then in effect, instructing Bank to make such change to the
Interest Period specified in said notice.  The interest rate payable on the
Note shall be adjusted to the LIBOR Rate then in effect for each successive
Interest Period plus 225 basis points; provided, however, that:

               (1)   Whenever  the  last day of any Interest  Period  would
otherwise  occur on a day other than a business day, the last day  of  such
Interest  Period shall be extended to occur on the next succeeding business
day,  provided,  that  such extension would cause  the  last  day  of  such
Interest Period to occur in the next calendar month, the last day  of  such
Interest  Period  shall in such case occur on the next  preceding  business
day; and

               (2)   No Interest Period may extend beyond the Maturity Date
of this Loan.

          e.    "Eurodollar Rate Loan" shall mean each Advance which  bears
interest based on the LIBOR Rate.

          f.   "Business Day" shall mean in the case of Eurodollar Loans, a
U.S. domestic business day and a day on which commercial banks are open for
international  business  (including dealings in U.S.  dollar  deposits)  in
London.

     4.   Manner of Borrowing and Disbursement.

          a.     Prime  Rate  Option Advances.  In the case of  Prime  Rate
Option  Advances,  the Borrower shall give the Bank at least  one  Business
Days' irrevocable written notice, or irrevocable telephonic notice followed
immediately  by  written  notice (provided, however,  that  the  Borrower's
failure  to  confirm any telephonic notice in writing shall not  invalidate
any notice so given), of Borrower's intention to borrow or reborrow a Prime
Rate Option Advance hereunder.  Notice shall be given to the Bank prior  to
11:00  a.m.,  in  order for such Business Day to count toward  the  minimum
number  of Business Days required.  Such notice of borrowing shall  specify
the  requested funding date, which shall be a Business Day, and the  amount
of the proposed aggregate Prime Rate Option Advances to be made by Bank.
33

          b.   LIBOR Rate Option Advances.

               (1)   LIBOR Rate Option Advances.  Advances under the  LIBOR
Rate  Option  will  be  in amounts of $1,000,000 or greater,  and  will  be
advanced  for periods equal to the LIBOR Rate Interest Period  selected  by
Borrower.

               (2)   Advance Borrowing Notice.  In the case of  LIBOR  Rate
Option  Advances,  the Borrower shall give the Bank at least  two  Business
Days' irrevocable written notice, or irrevocable telephonic notice followed
immediately  by  written  notice (provided, however,  that  the  Borrower's
failure  to  confirm any telephonic notice in writing shall not  invalidate
any  notice so given), of its intention to borrow or reborrow a LIBOR  Rate
Option Advance hereunder.  Notice shall be given to the Bank prior to 11:00
a.m., in order for such Business Day to count toward the minimum number  of
Business  Days required.  LIBOR Rate Option Advances shall in all cases  be
subject  to  availability and to paragraph 4b(3)  below.   For  LIBOR  Rate
Option  Advances,  the  notice  of borrowing shall  specify  the  requested
funding  date,  which shall be a Business Day, the amount of  the  proposed
aggregate  LIBOR Rate Option Advances to be made by Bank and  the  Interest
Period  selected  by  the Borrower, provided that no such  Interest  Period
shall extend past the Maturity Date of the Loan.

          c.    Readvances.   At  least two Business  Days  prior  to  each
Payment Date for a LIBOR Rate Option Advance, Borrower shall give the  Bank
irrevocable  written  notice,  or irrevocable  telephonic  notice  followed
immediately  by written notice (provided, however, that Borrower's  failure
to confirm any telephonic notice in writing shall not invalidate any notice
so  given),  specifying whether all or a portion of such LIBOR Rate  Option
Advance  outstanding  on the Payment Date (i) is  to  be  repaid  and  then
reborrowed in whole or in part as a LIBOR Rate Option Advance, or  (ii)  is
to be repaid and then reborrowed in whole or in part as a Prime Rate Option
Advance;  provided, however, notwithstanding anything in this Note  to  the
contrary,  (a)  if no notice is given the LIBOR Rate Option  Advance  shall
automatically be reborrowed at the LIBOR Rate for a 30 day Interest Period,
and  (b) if on any Payment Date an Event of Default shall exist, such LIBOR
Rate  Option Advance may only be reborrowed as a Prime Rate Option Advance.
Upon  such  Payment Date, such LIBOR Rate Option Advance shall, subject  to
the provisions hereof, be so repaid and reborrowed.
34

     5.   Changes in Circumstances.

               (a)   LIBOR Basis Determination Inadequate.  If with respect
to  any  LIBOR Rate Option Advance for any Interest Period, Bank determines
that  (i)  deposits  in dollars (in the applicable amount)  are  not  being
offered to the Bank in the relevant market for such Interest Period or (ii)
the  LIBOR Rate for such proposed Interest Period does not adequately cover
the  cost  to Bank of maintaining the outstanding principal amount  of  the
Note for such Interest Period, Bank shall forthwith give notice thereof  to
the  Borrower,  whereupon the interest rate on the Note shall automatically
convert to the Bank's Prime Rate, as adjusted on a daily basis.

               (b)  Illegality.  If any applicable law, rule or regulation,
or   any   change  therein  or  adoption  thereof,  or  interpretation   or
administration  thereof  by  any governmental authority,  central  bank  or
comparable   agency  charged  with  the  interpretation  or  administration
thereof,  or  compliance by Bank with any request or directive (whether  or
not  having  the  force  of  law) of any such authority,  central  bank  or
comparable  agency, shall make it unlawful or impossible for the  Bank   to
make, maintain or fund the principal amount of the Note at the then current
LIBOR  Rate  for the Interest Period selected by Borrower,  Bank  shall  so
notify the Borrower, and upon receipt of such notice,  the interest rate on
the  Note shall automatically convert to the Bank's Prime Rate, as adjusted
on a daily basis.

                                HITOX CORPORATION OF AMERICA, INC.

                                By: RICHARD L. BOWERS
                                    ------------------------
                                    Richard L. Bowers,
                                    Executive Vice President
35

                        BORROWING BASE CERTIFICATE

     This  Borrowing Base Certificate is delivered pursuant  to   Paragraph
1.2  of the Loan Agreement  dated August 31, 1995 between Hitox Corporation
of America, Inc. ("Borrower") and NationsBank of Texas, N.A., as amended by
First, Second and Third Amendments to Loan Agreement (as amended, the "Loan
Agreement") executed by Borrower and by Bank of America, N.A., successor in
interest by merger to NationsBank of Texas, N.A. ("Bank").  Words which are
capitalized herein which are defined in said Loan Agreement shall have  the
same  meanings  specified in the Loan Agreement.   The  undersigned  hereby
certifies  that the following amounts and statements are true and  correct,
as of _________________, 19____.

      1.    Eligible Accounts Receivable
                   ($____________ x 80%)             $______________
                   ("Borrowing Base Amount")

      2.    Less the amount of all advances
            presently outstanding under the
            Revolving Note                           -______________

      3.    Less the amount of all Letter of
            Credit Obligations outstanding under
            Revolving Note                           -______________

      4.    Amount available for additional
            advances under the Revolving Note        $______________

     [If  an  advance  is  being requested herewith] Borrower  requests  an
advance of $__________________ under the Revolving Note.

     I  hereby  certify  that  all  of the information  contained  in  this
Borrowing Base Certificate is true and correct as of the date shown  above,
that  the balance sheet, profit and loss statement, inventory list and aged
list  of accounts receivable attached hereunto are true and correct  as  of
said  date,  that no material adverse change in the financial condition  of
Borrower  has  occurred  since said date, and  that  no  Event  of  Default
specified in the Loan Agreement has occurred.

                              Hitox Corporation of America, Inc.

                              By:  ______________________________
                                   Craig Schkade, Chief Financial
                                   Officer and Treasurer

                                 EXHIBIT B
36

                          COMPLIANCE CERTIFICATE

     This Compliance Certificate is delivered pursuant to  Paragraph 4.4 of
the  Loan  Agreement  dated August 31, 1995 between  HITOX  CORPORATION  OF
AMERICA,  INC. ("Borrower") and NationsBank of Texas, N.A., as  amended  by
First, Second and Third Amendments to Loan Agreement (as amended, the "Loan
Agreement")  executed  by Borrower and by BANK OF AMERICA,  N.A.  ("Bank"),
successor in interest by merger to NationsBank of Texas, N.A.   Words which
are  capitalized herein which are defined in said Loan Agreement shall have
the  same  meanings specified in the Loan Agreement.  The  undersigned,  on
behalf  of  the  Borrower,  hereby  certifies  and  warrants  pursuant   to
Paragraphs 4.19 through 4.21 of the Loan Agreement, as follows:

     1.    The undersigned is authorized to make this certificate on behalf
of the Borrower.

     2.   As of ____________________, 19_____:

          (a)  Section 4.19.  Borrower's Ratio of Current Assets to Current
Liabilities  is  ____  to  1.0  on said date,  computed  as  set  forth  on
Attachment 1.

          (a)   Section  4.20.  Borrower's Ratio of Total Debt to  Tangible
Net  Worth  is  ____  to  1.0 for the twelve months ending  on  said  date,
computed as set forth on Attachment 2;

          (b)   Section 4.21.  Borrower's Funded Debt Coverage is  ____  to
1.0 on said date, computed as set forth on Attachment 3; and

          (d)   No  Default.  Borrower was not in default  of  any  of  the
provisions  of  the Loan Agreement during the three month period  to  which
this Compliance Certificate relates;

     IN  WITNESS  WHEREOF, the undersigned has executed and delivered  this
certificate to Bank this _____ day of ______________, 20______.

                              Hitox Corporation of America, Inc.

                              By:  ______________________________
                                   Craig Schkade, Chief Financial
                                   Officer and Treasurer

                              By:  ______________________________
                                   Bernard Paulson, President and CEO

                                 EXHIBIT D
37

                                                               Exhibit 99.1

                                                      For Immediate Release

                  Hitox Corporation Completes Purchase of
                      Malaysian Titanium Corporation

     Corpus  Christi,  TX  (March 6, 2000) - Hitox Corporation  of  America
(Nasdaq  SmallCap:  HTXA)  announces the  purchase  of  Malaysian  Titanium
Corporation  ("MTC").   Bernard  Paulson,  president  and  CEO,  said   the
agreement  was  executed in Malaysia March 3rd with an  effective  date  of
March  1st.  The purchase price totaled $5,150,000 of which $3,775,000  was
in  cash  and  $1,375,000 in Hitox Common Stock (500,000 shares  valued  at
$2.75  per  share).  MTC is a profitable company and will be managed  as  a
wholly owned subsidiary with close coordination of manufacturing and sales.

     MTC  is  not only the sole supplier of raw material for the  Company's
proprietary  titanium  pigment  HITOX  (Register  trademark)  but  is  also
producing  and  selling  that product in Asia  and  Europe  under  license.
Paulson  said  that  the  Company plans an immediate  doubling  of  pigment
capacity at MTC as the existing production line is almost sold out in  less
than   a   year  after  opening.   Asian  and  European  markets  represent
substantial  opportunities for both HITOX and the Company's other  products
which will be offered by MTC as soon as practical.

     Based   in  Corpus  Christi,  Texas,  Hitox  Corporation  manufactures
pigments  and extenders that are marketed worldwide to paint, plastics  and
chemical industries.

     Certain matters discussed in this news release include forward-looking
statements that involve risks and uncertainties detailed from time to  time
in  the  Company's  filings and reports with the  Securities  and  Exchange
Commission  including the Company's Annual Report on Form  10-KSB  for  the
year ended 1999.  Such statements are based on the beliefs of the Company's
management  as  well  as  assumptions made  by  and  information  currently
available  to  Company  management.  Actual events or  results  may  differ
materially.

For further information:
Richard L. Bowers
Executive Vice President
361 883-5591
38