Amendment No. 1 to the
                                WARRANT AGREEMENT
                            Dated as of June 1, 2000

                                     Between

                               ISONICS CORPORATION
                                       AND
                   CONTINENTAL STOCK TRANSFER & TRUST COMPANY

     THIS FIRST AMENDMENT TO THE WARRANT AGREEMENT between ISONICS CORPORATION
and CONTINENTAL STOCK TRANSFER & TRUST COMPANY dated as of June 1, 2000 (the
"Warrant Agreement") is entered into this 9th day of August, 2000. Capitalized
terms used herein, but not defined shall have the meanings ascribed to such
terms in the Warrant Agreement.

                              W I T N E S S E T H :

     WHEREAS, pursuant to the Warrant Agreement, the Class B Warrants are
scheduled to expire at the close of business on September 30, 2000, unless
previously exercised; and

     WHEREAS, the parties desire to amend the Warrant Agreement to extend the
expiration date of the Class B Warrants to the close of business on April 30,
2001.

     NOW, THEREFORE, ISONICS CORPORATION, a California corporation (the
"Company"), and CONTINENTAL STOCK TRANSFER & TRUST COMPANY (the "Warrant
Agent"), hereby agree to amend the Warrant Agreement as follows:

     1.   Paragraph (w) of Section 1 be and hereby is amended in its entirety so
that it now reads as follows:

     "Warrant Expiration Date" shall mean, unless the Warrants are redeemed as
     provided in Section 9 hereof prior to such date, 5:00 p.m. (New York time):
     (i) with respect to the Class B Warrants, on April 30, 2001, and (ii) with
     respect to the Class C Warrants, on June 15, 2003, or if earlier, the
     Redemption Date as defined herein, whichever date is earlier; provided that
     if such date shall in the State of New York be a holiday or a day on which
     banks located in the State of New York are authorized to close, then 5:00
     p.m. (New York time) on the next following day which, in the State of New
     York, is neither a holiday nor a day on which such banks are authorized to
     close. Upon prior written notice to the Registered Holders, the Company (in
     its sole discretion) shall have the right to extend the Warrant Expiration
     Date.

     2.   Exhibit "A" to the Warrant Agreement is hereby modified to conform
with


the extension of the expiration date of the Class B Warrants to and including
April 30, 2001.

     3.   Except as modified herein, the terms and conditions of the Warrant
Agreement shall remain in full force and effect.

     4.   This First Amendment may be executed in one or more counterparts, and
by different parties hereto on separate counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.

     IN WITNESS WHEREOF, this First Amendment has been executed as of the date
first written above.


ATTEST:                                ISONICS CORPORATION


By: /s/ Brantley J. Halstead           By: /s/ James E. Alexander
   -----------------------------          --------------------------------
Brantley J. Halstead, Secretary        James E. Alexander, President


ATTEST:                                CONTINENTAL STOCK TRANSFER & TRUST
                                       COMPANY, as Warrant Agent


By: /s/ Thomas Jennings                By: /s/ William F. Seegraber
   -----------------------------          --------------------------------
Name: Thomas Jennings                  Name: William F. Seegraber
     ---------------------------            ------------------------------
Title: Asst. Secretary                 Title: Vice President
      --------------------------             -----------------------------