<PAGE>

                       [PACIFIC CENTURY BANK N.A. LOGO]

                          CHANGE IN TERMS AGREEMENT
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Borrower:  CR Technology, Inc.         Lender:  Pacific Century Bank, N.A.
           125-B Columbia                       Orange County Loan Center (905)
           Aliso Viejo, CA 92858                16030 Ventura Boulevard
                                                Encino, CA 91436
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Principal Amount:  $1,500,000.00          Date of Agreement:  November 15, 1999

DESCRIPTION OF EXISTING INDEBTEDNESS.  Borrower is indebted to Lender in the
original principal amount of One Million Five Hundred Thousand & 00/100
Dollars ($1,500,000.00), as evidenced by a Promissory Note, dated as of July
20, 1998, as amended by the Change in Terms Agreement, dated as of August 13,
1999, executed by Borrower in favor of Lender.

DESCRIPTION OF COLLATERAL.  The Note is secured by the Collateral as described
in the Commercial Security Agreement, dated as of July 20, 1998, as it may be
amended, modified, supplemented, restated, or replaced, from time to time,
executed by Grantor in favor of Lender.

DESCRIPTION OF CHANGE IN TERMS.  Repayment schedule is amended as follows:
Borrower will pay this loan in one payment of all outstanding principal plus
all accrued unpaid interest on February 1, 2001. In addition, Borrower will
pay regular monthly payments of accrued unpaid interest beginning December 1,
1999, and all subsequent interest payments are due on the same day of each
month after that.

ARBITRATION.  Lender and Borrower agree that all disputes, claims and
controversies between them, whether individual, joint, or class in nature,
arising from this Agreement or otherwise, including without limitation
contract and tort disputes, shall be arbitrated pursuant to the Rules of the
American Arbitration Association, upon request of either party. No act to
take or dispose of any collateral securing this Agreement shall constitute a
waiver of this arbitration agreement or be prohibited by this arbitration
agreement. This includes, without limitation, obtaining injunctive relief or a
temporary restraining order, invoking a power of sale under any deed of trust
or mortgage; obtaining a writ of attachment or imposition of a receiver, or
exercising any rights relating to personal property, including taking or
disposing of such property with or without judicial process pursuant to
Article 9 of the Uniform Commercial Code. Any disputes, claims, or
controversies concerning the lawfulness or reasonableness of any act, or
exercise of any right, concerning any collateral securing this Agreement,
including any claim to rescind, reform, or otherwise modify any agreement
relating to the collateral securing this Agreement, shall also be
arbitrated, provided however that no arbitrator shall have the right or the
power to enjoin or restrain any act of any party. Lender and Borrower agree
that in the event of an action for judicial foreclosure pursuant to
California Code of Civil Procedure Section 726, or any similar provision in
any other state, the commencement of such an action will not constitute a
waiver of the right to arbitrate and the court shall refer to arbitration as
much of such action, including counterclaims, as lawfully may be referred to
arbitration. Judgement upon any award rendered by any arbitrator may be
entered in any court having jurisdiction. Nothing in this Agreement shall
preclude any party from seeking equitable relief from a court of competent
jurisdiction. The statute of limitations, estoppel, waiver, laches, and
similar doctrines which would otherwise be applicable in an action brought by
a party shall be applicable in any arbitration proceeding, and the
commencement of an arbitration proceeding shall be deemed the commencement of
an action for these purposes. The Federal Arbitration Act shall apply to the
construction, interpretation, and enforcement of this arbitration provision.

CONTINUING VALIDITY.  Except as expressly changed by this Agreement, the
terms of the original obligation or obligations, including all agreements
evidenced or securing the obligation(s), remain unchanged and in full force
and effect. Consent by Lender to this Agreement does not waive Lender's right
to strict performance of the obligation(s) as changed, nor obligate Lender to
make any future change in terms. Nothing in this Agreement will constitute a
satisfaction of the obligation(s). It is the intention of Lender to retain as
liable parties all makers and endorsers of the original obligation(s).
including accommodation parties, unless a party is expressly released by
Lender in writing. Any maker or endorser, including accommodation makers,
will not be released by virtue of this Agreement. If any person who signed
the original obligation does not sign this Agreement below, then all persons
signing below acknowledge that this Agreement is given conditionally, based
on the representation to Lender that the non-signing party consents to the
changes and provisions of this Agreement or otherwise will not be released by
it.  This waiver applies not only to any initial extension, modification or
release, but also to all such subsequent actions.

PRIOR TO SIGNING THIS AGREEMENT, BORROWER READ AND UNDERSTOOD ALL THE
PROVISIONS OF THIS AGREEMENT. BORROWER AGREES TO THE TERMS OF THE AGREEMENT
AND ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THE AGREEMENT.

BORROWER:

CR Technology, Inc.

By:  /s/ Richard E. Amtower
   -------------------------------
   Richard E. Amtower, President
   and Assistant Secretary


LENDER:

Pacific Century Bank, N.A.

By:  /s/  Ben A. [ILLEGIBLE]
   -------------------------------
   Authorized Officer
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<PAGE>

                        [CALIFORNIA UNITED BANK LOGO]

                           BUSINESS LOAN AGREEMENT
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Borrower: CR Technology, Inc.            Lender:  California United Bank
          27752 El Lazo Road                      Orange County Commercial
          Laguna Nigel, CA 92677-3914             Loan Center
                                                  16030 Ventura Boulevard
                                                  Encino, CA 91436
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THIS BUSINESS LOAN AGREEMENT BETWEEN CR TECHNOLOGY, INC. ("BORROWER") AND
CALIFORNIA UNITED BANK ("LENDER") IS MADE AND EXECUTED ON THE FOLLOWING TERMS
AND CONDITIONS. BORROWER HAS RECEIVED PRIOR COMMERCIAL LOANS FROM LENDER OR
HAS APPLIED TO LENDER FOR A COMMERCIAL LOAN OR LOANS AND OTHER FINANCIAL
ACCOMMODATIONS, INCLUDING THOSE WHICH MAY BE DESCRIBED ON ANY EXHIBIT OR
SCHEDULE ATTACHED TO THIS AGREEMENT. ALL SUCH LOANS AND FINANCIAL
ACCOMMODATIONS, TOGETHER WITH ALL FUTURE LOANS AND FINANCIAL ACCOMMODATIONS
FROM LENDER TO BORROWER, ARE REFERRED TO IN THIS AGREEMENT INDIVIDUALLY AS THE
"LOAN" AND COLLECTIVELY AS THE "LOANS." BORROWER UNDERSTANDS AND AGREES
THAT: (a) IN GRANTING, RENEWING, OR EXTENDING ANY LOAN, LENDER IS RELYING
UPON BORROWER'S REPRESENTATIONS, WARRANTIES, AND AGREEMENTS, AS SET FORTH IN
THIS AGREEMENT; (b) THE GRANTING, RENEWING, OR EXTENDING OF ANY LOAN BY
LENDER AT ALL TIMES SHALL BE SUBJECT TO LENDER'S SOLE JUDGEMENT AND
DISCRETION; AND (c) ALL SUCH LOANS SHALL BE AND SHALL REMAIN SUBJECT TO THE
FOLLOWING TERMS AND CONDITIONS OF THIS AGREEMENT.

TERM.  This Agreement shall be effective as of July 20, 1998, and shall
continue thereafter until all Indebtedness of Borrower to Lender has been
performed in full and the parties terminate this Agreement in writing.

DEFINITIONS.  The following words shall have the following meanings when used
in this Agreement. Terms not otherwise defined in this Agreement shall have
the meanings attributed to such terms in the Uniform Commercial Code. All
references to dollar amounts shall mean amounts in lawful money of the United
States of America.

     AGREEMENT.  The word "Agreement" means this Business Loan Agreement, as
     this Business Loan Agreement may be amended or modified from time to
     time, together with all exhibits and schedules attached to this Business
     Loan Agreement from time to time.

     BORROWER.  The word "Borrower" means CR Technology, Inc. The word
     "Borrower" also includes, as applicable, all subsidiaries and
     affiliates of Borrower as provided below in the paragraph titled
     "Subsidiaries and Affiliates."

     CERCLA.  The word "CERCLA" means the Comprehensive Environmental
     Response, Compensation, and Liability Act of 1980, as amended.

     COLLATERAL.  The word "Collateral" means and includes without limitation
     all property and assets granted as collateral security for a Loan,
     whether real or personal property, whether granted directly or
     indirectly, whether granted now or in the future, and whether granted
     in the form of a security interest, mortgage, deed of trust,
     assignment, pledge, chattel mortgage, chattel trust, factor's lien,
     equipment trust, conditional sale, trust receipt, lien, charge, lien or
     title retention contract, lease or consignment intended as a security
     device, or any other security or lien interest whatsoever, whether
     created by law, contract, or otherwise.

     ERISA.  The word "ERISA" means the Employee Retirement Income Security
     Act of 1974, as amended.

     EVENT OF DEFAULT.  The words "Event of Default" mean and include without
     limitation any of the Events of Default set forth below in the section
     titled "EVENTS OF DEFAULT."

     GRANTOR.  The word "Grantor" means and includes without limitation each
     and all of the persons or entities granting a Security Interest in any
     Collateral for the Indebtedness, including without limitation all
     Borrowers granting such a Security Interest.

     GUARANTOR.  The word "Guarantor" means and includes without limitation
     each and all of the guarantors, sureties, and accommodation parties in
     connection with any indebtedness.

     INDEBTEDNESS.  The word "Indebtedness" means and includes without
     limitation all Loans, together with all other obligations, debts and
     liabilities of Borrower to Lender, or any one or more of them, as well
     as all claims by Lender against Borrower, or any one or more of them;
     whether now or hereafter existing, voluntary or involuntary, due or not
     due, absolute or contingent, liquidated or unliquidated; whether
     Borrower may be liable individually or jointly with others; whether
     Borrower may be obligated as a guarantor, surety, or otherwise; whether
     recovery upon such Indebtedness may be or hereafter may become barred
     by any statute of limitations; and whether such Indebtedness may be or
     hereafter may become otherwise unenforceable.

     LENDER.  The word "Lender" means California United Bank, its successors
     and assigns.

     LOAN.  The word "Loan" or "Loans" means and includes without limitation
     any and all commercial loans and financial accommodations from Lender to
     Borrower, whether now or hereafter existing, and however evidenced,
     including without limitation those loans and financial accommodations
     described herein or described on any exhibit or schedule attached to this
     Agreement from time to time.

     NOTE.  The word "Note" means and includes without limitation Borrower's
     promissory note or notes, if any, evidencing Borrower's Loan obligations
     in favor of Lender, as well as any substitute, replacement or
     refinancing note or notes therefor.

     PERMITTED LIENS.  The words "Permitted Liens" mean: (a) liens and
     security interests securing indebtedness owed by Borrower to Lender; (b)
     liens for taxes, assessments, or similar charges either not yet due or
     being contested in good faith; (c) liens of materialmen, mechanics,
     warehousemen, or carriers, or other like liens arising in the ordinary
     course of business and securing obligations which are not yet delinquent;
     (d) purchase money liens or purchase money security interests upon or in
     any property acquired or held by Borrower in the ordinary course of
     business to secure indebtedness outstanding on the date of this
     Agreement or permitted to be incurred under the paragraph of this
     Agreement titled "Indebtedness and Liens"; (e) liens and security
     interests which, as of the date of this Agreement, have been disclosed to
     and approved by the Lender in writing; and (f) those liens and security
     interests which in the aggregate constitute an immaterial and
     insignificant monetary amount with respect to the net value of
     Borrower's assets.

     RELATED DOCUMENTS.  The words "Related Documents" mean and include
     without limitation all promissory notes, credit agreements, loan
     agreements, environmental agreements, guaranties, security agreements,
     mortgages, deeds of trust, and all other instruments, agreements and
     documents, whether now or hereafter existing, executed in connection with
     the Indebtedness.

     SECURITY AGREEMENT.  The words "Security Agreement" mean and include
     without limitation any agreements, promises, covenants, arrangements,
     understandings or other agreements, whether created by law, contract,
     or otherwise, evidencing, governing, representing, or creating a
     Security Interest.

<PAGE>

                           BUSINESS LOAN AGREEMENT                     PAGE 2
LOAN NO. 6889                     (Continued)


     SECURITY INTEREST.  The words "Security Interest" mean and include
     without limitation any type of collateral security, whether in the form
     of a lien, charge, mortgage, deed of trust, assignment, pledge, chattel
     mortgage, chattel trust, factor's lien, equipment trust, conditional
     sale, trust receipt, lien or title retention contract, lease or
     consignment intended as a security device, or any other security or lien
     interest whatsoever, whether created by law, contract, or otherwise.

     SARA.  The word "SARA" means the Superfund Amendments and
     Reauthorization Act of 1986 as now or hereafter amended.

CONDITIONS PRECEDENT TO EACH ADVANCE.  Lender's obligation to make the
initial Loan Advance and each subsequent Loan Advance under this Agreement
shall be subject to the fulfillment to Lender's satisfaction of all of the
conditions set forth in this Agreement and in the Related Documents.

     LOAN DOCUMENTS.  Borrower shall provide to Lender in form satisfactory
     to Lender the following documents for the Loan: (a) the Note, (b)
     Security Agreements granting to Lender security interests in the
     Collateral, (c) Financing Statements perfecting Lender's Security
     interests; (d) evidence of insurance as required below; and (e) any
     other documents required under this Agreement or by Lender or its
     counsel.

     BORROWER'S AUTHORIZATION.  Borrower shall have provided in form and
     substance satisfactory to Lender properly certified resolutions, duly
     authorizing the execution and delivery of this Agreement, the Note and
     the Related Documents, and such other authorizations and other documents
     and instruments as Lender or its counsel, in their sole discretion, may
     require.

     PAYMENT OF FEES AND EXPENSES.  Borrower shall have paid to Lender all
     fees, charges, and other expenses which are then due and payable as
     specified in this Agreement or any Related Document.

     REPRESENTATIONS AND WARRANTIES.  The representations and warranties set
     forth in this Agreement, in the Related Documents, and in any document
     or certificate delivered to Lender under this Agreement are true and
     correct.

     NO EVENT OF DEFAULT.  There shall not exist at the time of any advance a
     condition which would constitute an Event of Default under this
     Agreement.

REPRESENTATIONS AND WARRANTIES.  Borrower represents and warrants to Lender,
as of the date of this Agreement, as of the date of each disbursement of Loan
proceeds, as of the date of any renewal, extension or modification of any
Loan, and at all times any Indebtedness exists:

     ORGANIZATION.  Borrower is a corporation which is duly organized,
     validly existing, and in good standing under the laws of the State of
     California and is validly existing and in good standing in all states in
     which Borrower is doing business.  Borrower has the full power and
     authority to own its properties and to transact the businesses in which
     it is presently engaged or presently proposes to engage.  Borrower also
     is duly qualified as a foreign corporation and is in good standing in
     all states in which the failure to so qualify would have a material
     adverse effect on its businesses or financial condition.

     AUTHORIZATION.  The execution, delivery, and performance of this
     Agreement and all Related Documents by Borrower, to the extent to be
     executed, delivered or performed by Borrower, have been duly authorized
     by all necessary action by Borrower; do not require the consent or
     approval of any other person, regulatory authority or governmental body;
     and do not conflict with, result in a violation of, or constitute a
     default under (a) any provision of its articles of incorporation or
     organization, or bylaws, or any agreement or other instrument binding
     upon Borrower or (b) any law, governmental regulation, court decree, or
     order applicable to Borrower.

     FINANCIAL INFORMATION.  Each financial statement, and tax returns of
     Borrower supplied to Lender truly and completely disclosed Borrower's
     financial condition as of the date of the statement, and there has been
     no material adverse change in Borrower's financial condition subsequent
     to the date of the most recent financial statement supplied to Lender.
     Borrower has no material contingent obligations except as disclosed in
     such financial statements.  Said financial statements shall (including
     the disclosure of all liabilities as hereinabove mentioned) have been
     prepared in accordance with generally accepted accounting principles
     ("GAAP"), consistently applied (provided, however, that tax returns may
     be prepared using a basis of accounting other than GAAP).

     LEGAL EFFECT.  This Agreement constitutes, and any instrument or
     agreement required hereunder to be given by Borrower when delivered will
     constitute, legal, valid and binding obligations of Borrower enforceable
     against Borrower in accordance with their respective terms.

     PROPERTIES.  Except as contemplated by this Agreement or as previously
     disclosed in Borrower's financial statements or in writing to Lender and
     as accepted by Lender, and except for property tax liens for taxes not
     presently due and payable, Borrower owns and has good title to all of
     Borrower's properties free and clear of all Security Interests, and has
     not executed any security documents or financing statements relating to
     such properties.  All of Borrower's properties are titled in Borrower's
     legal name, and Borrower has not used, or filed a financing statement
     under, any other name for at least the last five (5) years.

     HAZARDOUS SUBSTANCES.  The terms "hazardous waste," "hazardous
     substance," "disposal," "release," and "threatened release," as used in
     this Agreement, shall have the same meanings as set forth in the
     "CERCLA," "SARA," the Hazardous Materials Transportation Act, 49 U.S.C.
     Section 1801, et seq., the Resource Conservation and Recovery Act, 42
     U.S.C. Section 6901, et seq., Chapters 6.5 through 7.7 of Division 20 of
     the California Health and Safety Code, Section 25100, et seq., or other
     applicable state or Federal laws, rules, or regulations adopted pursuant
     to any of the foregoing.  Except as disclosed to and acknowledged by
     Lender in writing, Borrower represents and warrants that: (a) During the
     period of Borrower's ownership of the properties, there has been no
     use, generation, manufacture, storage, treatment, disposal, release or
     threatened release of any hazardous waste or substance by any person on,
     under, about or from any of the properties. (b) Borrower has no
     knowledge of, or reason to believe that there has been (i) any use,
     generation, manufacture, storage, treatment, disposal, release, or
     threatened release of any hazardous waste or substance on, under, about
     or from the properties by any prior owners or occupants of any of the
     properties, or (ii) any actual or threatened litigation or claims of
     any kind by any person relating to such matters. (c) Neither Borrower
     nor any tenant, contractor, agent or other authorized user of any of the
     properties shall use, generate, manufacture, store, treat, dispose of,
     or release any hazardous waste or substance on, under, about or from any
     of the properties; and any such activity shall be conducted in
     compliance with all applicable federal, state, and local laws,
     regulations, and ordinances, including without limitation those laws,
     regulations and ordinances described above.  Borrower authorizes Lender
     and its agents to enter upon the properties to make such inspections and
     tests as Lender may deem appropriate to determine compliance of the
     properties with this section of the Agreement.  Any inspections or tests
     made by Lender shall be at Borrower's expense and for Lender's purposes
     only and shall not be construed to create any responsibility or liability
     on the part of Lender to Borrower or to any other person.  The
     representations and warranties contained herein are based on Borrower's
     due diligence in investigating the properties for hazardous waste and
     hazardous substances.  Borrower hereby (a) releases and waives any
     future claims against Lender for indemnity or contribution in the event
     Borrower becomes liable for cleanup or other costs under any such laws,
     and (b) agrees to indemnify and hold harmless Lender against any and all
     claims, losses, liabilities, damages, penalties, and expenses which
     Lender may directly or indirectly sustain or suffer resulting from a
     breach of a hazardous waste or substance on the properties.  The
     provisions of this section of the Agreement, including the obligation to
     indemnify, shall survive the payment of the Indebtness and the
     termination or expiration of this Agreement and shall not be affected by
     Lender's acquisition of any interest in any of the properties, whether by
     foreclosure or otherwise.

     LITIGATION AND CLAIMS.  No litigation, claim, investigation,
     administrative proceeding or similar action (including those for unpaid
     taxes) against Borrower is pending or threatened, and no other event has
     occurred which may materially adversely affect Borrower's financial
     condition or

<PAGE>

                                                                        PAGE 3

     properties, other than litigation, claims, or other events, if any, that
     have been disclosed to and acknowledged by Lender in writing.

     TAXES.  To the best of Borrower's knowledge, all tax returns and reports
     of Borrower that are or were required to be filed, have been filed, and
     all taxes, assessments and other governmental charges have been paid in
     full, except those presently being or to be contested by Borrower in
     good faith in the ordinary course of business and for which adequate
     reserves have been provided.

     LIEN PRIORITY.  Unless otherwise previously disclosed to Lender in
     writing, Borrower has not entered into or granted any Security
     Agreements, or permitted the filing or attachment of any Security
     Interests on or affecting any of the Collateral directly or indirectly
     securing repayment of Borrower's Loan and Note, that would be prior or
     that may in any way be superior to Lender's Security Interests and
     rights in and to such Collateral.

     BINDING EFFECT.  This Agreement, the Note, all Security Agreements
     directly or indirectly securing repayment of Borrower's Loan and Note
     and all of the Related Documents are binding upon Borrower as well as
     upon Borrower's successors, representatives and assigns, and are legally
     enforceable in accordance with their respective terms.

     COMMERCIAL PURPOSES.  Borrower intends to use the Loan proceeds solely
     for business or commercial related purposes.

     EMPLOYEE BENEFIT PLANS.  Each employee benefit plan as to which Borrower
     may have any liability complies in all material respects with all
     applicable requirements of law and regulations, and (i) no Reportable
     Event nor Prohibited Transaction (as defined in ERISA) has occurred with
     respect to any such plan, (ii) Borrower has not withdrawn from any such
     plan or initiated steps to do so, (iii) no steps have been taken to
     terminate any such plan, and (iv) there are no unfunded liabilities
     other than those previously disclosed to Lender in writing.

     LOCATION OF BORROWER'S OFFICES AND RECORDS.  Borrower's place of
     business, or Borrower's Chief executive office, if Borrower has more
     than one place of business, is located at 27752 El Lazo Road, Laguna
     Nigel, CA 92677-3914.  Unless Borrower has designated otherwise in
     writing this location is also the office or offices where Borrower keeps
     its records concerning the Collateral.

     YEAR 2000.  Borrower warrants and represents that all software utilized
     in the conduct of Borrower's business will have appropriate capabilities
     and compatibility for operation to handle calendar dates falling on or
     after January 1, 2000, and all information pertaining to such calendar
     dates, in the same manner and with the same functionality as the
     software does respecting calendar dates falling on or before December
     31, 1999.  Further, Borrower warrants and represents that the
     data-related user interface functions, data-fields, and data-related
     program instructions and functions of the software include the
     indication of the century.

     INFORMATION.  All information heretofore or contemporaneously herewith
     furnished by Borrower to Lender for the purposes of or in connection
     with this Agreement or any transaction contemplated hereby is, and all
     information hereafter furnished by or on behalf of Borrower to Lender
     will be, true and accurate in every material respect on the date as of
     which such information is dated or certified; and none of such
     information is or will be incomplete by omitting to state any material
     fact necessary to make such information not misleading.

     SURVIVAL OF REPRESENTATIONS AND WARRANTIES.  Borrower understands and
     agrees that Lender, without independent investigation, is relying upon
     the above representations and warranties in extending Loan Advances to
     Borrower.  Borrower further agrees that the foregoing representations
     and warranties shall be continuing in nature and shall remain in full
     force and effect until such time as Borrower's Indebtedness shall be
     paid in full, or until this Agreement shall be terminated in the manner
     provide above, whichever is the last to occur.

AFFIRMATIVE COVENANTS.  Borrower covenants and agrees with Lender that, while
this Agreement is in effect, Borrower will:

     LITIGATION.  Promptly inform Lender in writing of (a) all material
     adverse changes in Borrower's financial condition, and (b) all existing
     and all threatened litigation, claims, investigations, administrative
     proceedings or similar actions affecting Borrower or any Guarantor which
     could materially affect the financial condition of Borrower or the
     financial condition of any Guarantor.

     FINANCIAL RECORDS.  Maintain its books and records in accordance with
     generally accepted accounting principles, applied on a consistent basis,
     and permit Lender to examine and audit Borrower's books and records at
     all reasonable times.

     ADDITIONAL INFORMATION.  Furnish such additional information and
     statements, lists of assets and liabilities, aging of receivables and
     payables, inventory schedules, budgets, forecasts, tax returns, and
     other reports with respect to Borrower's financial condition and
     business operations as Lender may request from time to time.

     INSURANCE.  Maintain fire and other risk insurance, public liability
     insurance, and such other insurance as Lender may require with respect
     to Borrower's properties and operations, in form, amounts, coverages and
     with insurance companies reasonably acceptable to Lender.  Borrower,
     upon request of Lender, will deliver to Lender from time to time the
     policies or certificates of insurance in form satisfactory to Lender,
     including stipulations that coverages will not be cancelled or
     diminished without at least ten (10) days' prior written notice to
     Lender.  Each insurance policy also shall include an endorsement
     providing that coverage in favor of Lender will not be impaired in any
     way by any act, omission or default of Borrower or any other person.  In
     connection with all policies covering assets in which Lender holds or is
     offered a security interest for the Loans, Borrower will provide Lender
     with such loss payable or other endorsements as Lender may require.

     INSURANCE REPORTS.  Furnish to Lender, upon request of Lender, reports
     on each existing insurance policy showing such information as Lender may
     reasonably request, including without limitation the following: (a) the
     name of the insurer; (b) the risks insured; (c) the amount of the
     policy; (d) the properties insured; (e) the then current property values
     on the basis of which insurance has been obtained, and the manner of
     determining those values; and (f) the expiration date of the policy.  In
     addition, upon request of Lender (however not more often than annually),
     Borrower will have an independent appraiser satisfactory to Lender
     determine, as applicable, the actual cash value or replacement cost of
     any Collateral.  The cost of such appraisal shall be paid by Borrower.

     OTHER AGREEMENTS.  Comply with all terms and conditions of all other
     agreements, whether now or hereafter existing, between Borrower and any
     other party and notify Lender immediately in writing of any default in
     connection with any other such agreements.

     LOAN PROCEEDS.  Use all Loan proceeds solely for Borrower's business
     operations, unless specifically consented to the contrary by Lender in
     writing.

     TAXES, CHARGES AND LIENS.  Pay and discharge when due all of its
     indebtedness and obligations, including without limitation all
     assessments, taxes, governmental charges, levies and liens, of every
     kind and nature, imposed upon Borrower or its properties, income, or
     profits, prior to the date on which penalties would attach, and all
     lawful claims that, if unpaid, might become a lien or charge upon any of
     Borrower's properties, income, or profits.  Provided however, Borrower
     will not be required to pay any discharge any such assessment, tax,
     charge, levy, lien or claim so long as (a) the legality of the same
     shall be contested in good faith by appropriate proceedings, and (b)
     Borrower shall have established on its books adequate reserves with
     respect to such contested assessment, tax, charge, levy, lien, or claim
     in accordance with generally accepted accounting practices.  Borrower,
     upon demand of Lender, will furnish to Lender evidence of payment of the
     assessments, taxes, charges, levies, liens and claims and will authorize
     the appropriate governmental official to deliver to Lender at any time a
     written statement of any assessments, taxes, charges, levies, liens and
     claims against Borrower's properties, income, or profits.

     PERFORMANCE.  Perform and comply with all terms, conditions, and
     provisions set forth in this Agreement and in the Related Documents in a
     timely manner, and promptly notify Lender if Borrower learns of the
     occurrence of any event which constitutes an Event of Default under this
     Agreement

<PAGE>

                                                                       PAGE 4

     or under any of the Related Documents.

     OPERATIONS.  Maintain executive and management personnel with
     substantially the same qualifications and experience as the present
     executive and management personnel; provide written notice to Lender of
     any change in executive and management personnel; conduct its business
     affairs in a reasonable and prudent manner and in compliance with all
     applicable federal, state and municipal laws, ordinances, rules and
     regulations respecting its properties, charters, businesses and
     operations, including without limitation, compliance with the Americans
     With Disabilities Act and with all minimum funding standards and other
     requirements of ERISA and other laws applicable to Borrower's employee
     benefit plans.

     INSPECTION.  Permit employees or agents of Lender at any reasonable time
     to inspect any and all Collateral for the Loan or Loans and Borrower's
     other properties and to examine or audit Borrower's books, accounts, and
     records and to make copies and memoranda of Borrower's books, accounts,
     and records.  If Borrower now or at any time hereafter maintains any
     records (including without limitation computer generated records and
     computer software programs for the generation of such records) in the
     possession of a third party, Borrower, upon request of Lender, shall
     notify such party to permit Lender free access to such records at all
     reasonable times and to provide Lender with copies of any records it may
     request, all at Borrower's expense.

     ENVIRONMENTAL COMPLIANCE AND REPORTS.  Borrower shall comply in all
     respects with all environmental protection federal, state and local
     laws, statutes, regulations and ordinances; not cause or permit to
     exist, as a result of an intentional or unintentional action or omission
     on its part or on the part of any third party, on property owned and/or
     occupied by Borrower, any environmental activity where damage may result
     to the environment, unless such environmental activity is pursuant to
     and in compliance with the conditions of a permit issued by the
     appropriate federal, state or local governmental authorities; shall
     furnish to Lender promptly and in any event within thirty (30) days
     after receipt thereof a copy of any notice, summons, lien, citation,
     directive, letter or other communication from any governmental agency or
     instrumentality concerning any intentional or unintentional action or
     omission on Borrower's part in connection with any environmental
     activity whether or not there is damage to the environment and/or other
     natural resources.

     ADDITIONAL ASSURANCES.  Make, execute and deliver to Lender such
     promissory notes, mortgages, deeds of trust, security agreements,
     financing statements, instruments, documents and other agreements as
     Lender or its attorneys may reasonably request to evidence and secure
     the Loans and to perfect all Security Interests.

RECOVERY OF ADDITIONAL COSTS.  If the imposition of or any change in any law,
rule, regulation or guideline, or the interpretation or application of any
thereof by any court or administrative or governmental authority (including
any request or policy not having the force of law) shall impose, modify or
make applicable any taxes (except U.S. federal, state or local income or
franchise taxes imposed on Lender), reserve requirements, capital adequacy
requirements or other obligations which would (a) increase the cost to Lender
for extending or maintaining the credit facilities to which this Agreement
relates, (b) reduce the amounts payable to Lender under this Agreement or the
Related Documents, or (c) reduce the rate of return on Lender's capital as a
consequence of Lender's obligations with respect to the credit facilities to
which this Agreement relates, then Borrower agrees to pay Lender such
additional amounts as will compensate Lender therefor, within five (5) days
after Lender's written demand for such payment, which demand shall be
accompanied by an explanation of such imposition or charge and a calculation
in reasonable detail of the additional amounts payable by Borrower, which
explanation and calculations shall be conclusive in the absence of manifest
error.

NEGATIVE COVENANTS.  Borrower covenants and agrees with Lender that while
this Agreement is in effect, Borrower shall not, without the prior written
consent of Lender:

     INDEBTEDNESS AND LIENS.  (a) Except for trade debt incurred in the
     normal course of business and indebtedness to Lender contemplated by
     this Agreement, create, incur or assume indebtedness for borrowed money,
     including capital leases, (b) except as allowed as a Permitted Lien,
     sell, transfer, mortgage, assign, pledge, lease, grant a security
     interest in, or encumber any of Borrower's assets, or (c) sell with
     recourse any of Borrower's accounts, except to Lender.

     CONTINUITY OF OPERATIONS.  (a) Engage in any business activities
     substantially different than those in which Borrower is presently engaged,
     (b) cease operations, liquidate, merge, transfer, acquire or consolidate
     with any other entity, change ownership, change its name, dissolve or
     transfer or sell Collateral out of the ordinary course of business, (c)
     pay any dividends on Borrower's stock (other than dividends payable in its
     stock), provided, however that notwithstanding the foregoing, but only so
     long as no Event of Default has occurred and is continuing or would result
     from the payment of dividends, if Borrower is a "Subchapter S Corporation"
     (as defined in the Internal Revenue Code of 1986, as amended), Borrower may
     pay cash dividends on its stock to its shareholders from time to time in
     amounts necessary to enable the shareholders to pay income taxes and make
     estimated income tax payments to satisfy their liabilities under federal
     and state law which arise solely from their status as Shareholders of a
     Subchapter S Corporation because of their ownership of shares of stock of
     Borrower, or (d) purchase or retire any of Borrower's outstanding shares
     or alter or amend Borrower's capital structure.

     LOANS, ACQUISITIONS AND GUARANTIES.  (a) Loan, invest in or advance money
     or assets, (b) purchase, create or acquire any interest in any other
     enterprise or entity, or (c) incur any obligation as surety or guarantor
     other than in the ordinary course of business.

CESSATION OF ADVANCES.  If Lender has made any commitment to make any Loan to
Borrower, whether under this Agreement or under any other agreement, Lender
shall have no obligation to make Loan Advances or to disburse Loan proceeds
if: (a) Borrower or any Guarantor is in default under the terms of this
Agreement or any of the Related Documents or any other agreement that
Borrower or any Guarantor has with Lender; (b) Borrower or any Guarantor
becomes insolvent, files a petition in bankruptcy or similar proceedings, or
is adjudged a bankrupt; (c) there occurs a material adverse change in
Borrower's financial condition, in the financial condition of any Guarantor,
or in the value of any Collateral securing any Loan; (d) any Guarantor seeks,
claims or otherwise attempts to limit, modify or revoke such Guarantor's
guaranty of the Loan or any other loan with Lender; or (e) Lender in good
faith deems itself insecure, even though no Event of Default shall have
occurred.

FINANCIAL COVENANTS AND RATIOS.  Borrower covenants and agrees with Lender that
while this Agreement is in effect, Borrower shall comply at all times with the
following financial covenants and ratios:

(a)  EFFECTIVE TANGIBLE NET WORTH.  Borrower shall maintain an Effective
Tangible Net Worth (defined as the aggregate net worth plus subordinated debt,
less any intangible assets, and less any amount due from shareholders, officers
and affiliates of Borrower) of not less than $2,800,000.00, with a step-up to
$3,000,000.00 at December 31, 1999.

(b)  RATIO OF TOTAL DEBT TO EFFECTIVE TANGIBLE NET WORTH.  Borrower shall
maintain a Ratio of Total Debt to Effective Tangible Net Worth (defined as
current liabilities and non-current liabilities less subordinated debt divided
by Effective Tangible Net Worth) of not more than 1.00 to 1.00.

(c)  QUICK RATIO.  Borrower shall maintain a Quick Ratio (defined as cash and
accounts receivable divided by total current liabilities) of not less than 1.25
to 1.00.

(d)  PROFITABILITY.  Borrower shall generate a net profit from operations at
the end of each fiscal year.

Compliance with the foregoing financial covenants and ratios shall be
determined as of the end of each fiscal year, except as otherwise specifically
provided above.  All calculations made to determine compliance with the
requirements as set forth above shall be made in accordance with generally


<PAGE>

                                                                       PAGE 5


accepted accounting principles consistently applied and used consistently with
prior practices.

BORROWER'S FINANCIAL REPORTS.  Borrower shall maintain a system of accounting
established and administered in accordance with sound business practices to
permit preparation of the following financial reports in conformity with
generally accepted accounting principles.  Borrower covenants and agrees with
Lender that while this Agreement is in effect, unless Lender shall otherwise
give its prior written consent, Borrower shall provide to Lender the following
financial reports; certified by Borrower as being true and correct:

(a)  ANNUAL FINANCIAL STATEMENTS.  As soon as available and in any event
within one hundred twenty (120) days after the end of each fiscal year,
Borrower shall deliver to Lender the financial statements of Borrower,
audited by certified public accountants acceptable to Lender, including, but
not limited to, a balance sheet, an income statement, a statement of cash
flows, and appropriate footnotes and schedules.  Such financial statements
shall present fairly the financial condition of Borrower as at the dates
indicated as well as the results of its operations and cash flows for the
periods indicated in conformity with generally accepted accounting principles
applied on a basis consistent with prior years.

(b)  QUARTERLY FINANCIAL STATEMENTS.  As soon as available and in any event
within forty-five (45) days after the end of each fiscal quarter, Borrower
shall deliver to Lender the financial statements of Borrower, prepared by
Borrower, including, but not limited to, a balance sheet, an income statement,
and appropriate schedules.

OTHER REPORTS.  Borrower covenants and agrees with Lender that while this
Agreement is in effect, unless Lender shall otherwise give its prior written
consent, Borrower shall provide to Lender with the following reports:

(a)  ACCOUNTS RECEIVABLE AND ACCOUNTS PAYABLE AGINGS.  As soon as available and
in any event within forty-five (45) days after the end of each fiscal quarter,
Borrower shall deliver to Lender (i) a detailed aging, by total and by
customer, of Borrower's accounts receivable, and (ii) a detailed aging, by
total and by vendor, of Borrower's accounts payable, both of which shall be set
forth in a form and shall contain such information as is acceptable to Lender.

(b)  INVENTORY REPORT.  As soon as available and in any event within forty-five
(45) days after the end of each fiscal quarter, Borrower shall deliver to
Lender an inventory report of Borrower, to be reconciled to the general ledger,
in such form and detail as Lender may require.

OUT OF DEBT PROVISION. Borrower shall maintain a zero balance on the revolving
line of credit for a period of at least thirty (30) consecutive days during the
term of this loan.

DEPOSIT ACCOUNTS.  Borrower covenants and agrees with Lender that while this
Agreement is in effect, Borrower shall maintain its deposit accounts with
Lender.

RIGHT OF SETOFF.  Borrower grants to Lender a contractual security interest
in, and hereby assigns, conveys, delivers, pledges, and transfers to Lender
all Borrower's right, title and interest in and to, Borrower's accounts with
Lender (whether checking, savings, or some other account), including without
limitation all accounts held jointly with someone else and all accounts
Borrower may open in the future, excluding however all IRA and Keogh
accounts, and all trust accounts for which the grant of a security interest
would be prohibited by law.  Borrower authorizes Lender, to the extent
permitted by applicable law, to charge or setoff all sums owing on the
Indebtedness against any and all such accounts.

EVENTS OF DEFAULT.  Each of the following shall constitute an Event of Default
under this Agreement:

     DEFAULT ON INDEBTEDNESS.  Failure of Borrower to make any payment when due
     on the Loans.

     OTHER DEFAULTS.  Failure of Borrower or any Grantor to comply with or to
     perform when due any other term, obligation, covenant or condition
     contained in this Agreement or in any of the Related Documents, or failure
     of Borrower to comply with or to perform any other term, obligation,
     covenant or condition contained in any other agreement between Lender and
     Borrower.

     DEFAULT IN FAVOR OF THIRD PARTIES.  Should Borrower or any Grantor default
     under any loan, extension of credit, security agreement, purchase or sales
     agreement, or any other agreement, in favor of any other creditor or
     person that may materially affect any of Borrower's property or Borrower's
     or any Grantor's ability to repay the Loans or perform their respective
     obligations under this Agreement or any of the Related Documents.

     FALSE STATEMENTS.  Any warranty, representation or statement made, or
     furnished to Lender by or on behalf of Borrower or any Grantor under this
     Agreement or the Related Documents is false or misleading in any material
     respect at the time made or furnished, or becomes false or misleading at
     any time thereafter.

     DEFECTIVE COLLATERALIZATION.  This Agreement or any of the Related
     Documents ceases to be in full force and effect (including failure of any
     Security Agreement to create a valid and perfected Security Interest) at
     any time and for any reason.

     INSOLVENCY.  The dissolution or termination of Borrower's existence as a
     going business, the insolvency of the Borrower, the appointment of a
     receiver for any part of Borrower's property, any assignment for the
     benefit of creditors, any type of creditor workout, or the commencement of
     any proceeding under any bankruptcy or insolvency laws by or against
     Borrower.

     CREDITOR OR FORFEITURE PROCEEDINGS.  Commencement of foreclosure or
     forfeiture proceedings, whether by judicial proceeding, self-help,
     repossession or any other method, by any creditor of Borrower, any
     creditor of any Grantor against any collateral securing the Indebtedness,
     or by any governmental agency.  This includes a garnishment, attachment,
     or levy on or of any of Borrower's deposit accounts with Lender.

     EVENTS AFFECTING GUARANTOR.  Any of the preceding events occurs with
     respect to any Guarantor of any of the Indebtedness or any Guarantor dies
     or becomes incompetent, or revokes or disputes the validity of, or
     liability under, any Guaranty of the Indebtedness.

     CHANGE IN OWNERSHIP. Any change in ownership of twenty-five percent (25%)
     or more of the common stock of Borrower.

     ADVERSE CHANGE.  A material adverse change occurs in Borrower's financial
     condition, or Lender believes the prospect of payment or performance of
     the Indebtedness is impaired.

     INSECURITY.  Lender, in good faith, deems itself insecure.

EFFECT OF AN EVENT OF DEFAULT.  If any Event of Default shall occur, except
where otherwise provided in this Agreement or the Related Documents, all
commitments and obligations of Lender under this Agreement or the Related
Documents or any other agreement immediately will terminate (including any
obligation to make Loan Advances or disbursements), and, at Lender's option,
all Indebtedness immediately will become due and payable, all without notice of
any kind to Borrower, except that in the case of an Event of Default of the
type described in the "Insolvency" subsection above, such acceleration shall be
automatic and not optional.  In addition, Lender shall have all the rights and
remedies provided in the Related Documents or available at law, in equity, or
otherwise.  Except as may be prohibited by applicable law, all of Lender's
rights and remedies shall be cumulative and may be exercised singularly or
concurrently.  Election by Lender to pursue any remedy shall not exclude
pursuit of any other remedy, and an election to make expenditures or to take
action to perform an obligation of Borrower or of any Grantor shall not affect
Lender's right to declare a default and to exercise its rights and remedies.


<PAGE>

                             BUSINESS LOAN AGREEMENT
LOAN NO 6889                       (CONTINUED)                         PAGE 6
------------------------------------------------------------------------------
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part
of this Agreement:

     AMENDMENTS. This Agreement, together with any Related Documents,
     constitutes the entire understanding and agreement of the parties as to
     the matters set forth in this Agreement. No alteration of or amendment to
     this Agreement shall be effective unless given in writing and signed by
     the party or parties sought to be charged or bound by the alteration or
     amendment.

     APPLICABLE LAW. THIS AGREEMENT HAS BEEN DELIVERED TO LENDER AND ACCEPTED
     BY LENDER IN THE STATE OF CALIFORNIA. IF THERE IS A LAWSUIT, BORROWER
     AGREES UPON LENDER'S REQUEST TO SUBMIT TO THE JURISDICTION OF THE COURTS
     OF LOS ANGELES COUNTY, THE STATE OF CALIFORNIA. SUBJECT TO THE
     PROVISIONS ON ARBITRATION, THIS AGREEMENT SHALL BE GOVERNED BY AND
     CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.

     ARBITRATION. LENDER AND BORROWER AGREE THAT ALL DISPUTES, CLAIMS AND
     CONTROVERSIES BETWEEN THEM, WHETHER INDIVIDUAL, JOINT, OR CLASS IN
     NATURE, ARISING FROM THIS AGREEMENT OR OTHERWISE, INCLUDING WITHOUT
     LIMITATION CONTRACT AND TORT DISPUTES, SHALL BE ARBITRATED PURSUANT TO
     THE RULES OF THE AMERICAN ARBITRATION ASSOCIATION, UPON REQUEST OF
     EITHER PARTY. No act to take or dispose of any Collateral shall
     constitute a waiver of this arbitration agreement or be prohibited by
     this arbitration agreement. This includes, without limitation, obtaining
     injunctive relief or a temporary restraining order; invoking a power of
     sale under any deed of trust or mortgage; obtaining a writ of attachment
     or imposition of a receiver; or exercising any rights relating to
     personal property, including taking or disposing of such property with
     or without judicial process pursuant to Article 9 of the Uniform
     Commercial Code. Any disputes, claims, or controversies concerning the
     lawfulness or reasonableness of any act, or exercise of any right,
     concerning any Collateral, including any claim to rescind, reform, or
     otherwise modify any agreement relating to the Collateral, shall also be
     arbitrated, provided however that no arbitrator shall have the right or
     the power to enjoin or restrain any act of any party. Lender and Borrower
     agree that in the event of an action for judicial foreclosure pursuant
     to California Code of Civil Procedure Section 726, or any similar
     provision in any other state, the commencement of such an action will not
     constitute a waiver of the right to arbitrate and the court shall refer
     to arbitration as much of such action, including counterclaims, as
     lawfully may be referred to arbitration. Judgment upon any award
     rendered by any arbitrator may be entered in any court having
     jurisdiction. Nothing in this Agreement shall preclude any party from
     seeking equitable relief from a court of competent jurisdiction. The
     statute of limitations, estoppel, waiver, laches, and similar doctrines
     which would otherwise be applicable in an action brought by a party
     shall be applicable in any arbitration proceeding, and the commencement
     of an arbitration proceeding shall be deemed the commencement of an
     action for these purposes. The Federal Arbitration Act shall apply to
     the construction, interpretation, and enforcement of this arbitration
     provision.

     CAPTION HEADINGS. Caption headings in this Agreement are for
     convenience purposes only and are not to be used to interpret or define
     the provisions of this Agreement.

     CONSENT TO LOAN PARTICIPATION. Borrower agrees and consents to Lender's
     sale or transfer, whether now or later, of one or more participation
     interests in the Loans to one or more purchasers, whether related or
     unrelated to Lender. Lender may provide, without any limitation
     whatsoever, to any one or more purchasers, or potential purchasers, any
     information or knowledge Lender may have about Borrower or about any
     other matter relating to the Loan, and Borrower hereby waives any rights
     to privacy it may have with respect to such matters. Borrower
     additionally waives any and all notices of sale of participation
     interests, as well as all notices of any repurchase of such
     participation interests. Borrower also agrees that the purchasers of any
     such participation interests will be considered as the absolute owners
     of such interests in the Loans and will have all the rights granted
     under the participation agreement or agreements governing the sale of
     such participation interests. Borrower further waives all rights of
     offset or counterclaim that it may have now or later against Lender or
     against any purchaser of such a participation interest and
     unconditionally agrees that either Lender or such purchaser may enforce
     Borrower's obligation under the Loans irrespective of the failure or
     insolvency of any holder of any interest in the Loans. Borrower further
     agrees that the purchaser of any such participation interests may
     enforce its interests irrespective of any personal claims or defenses
     that Borrower may have against Lender.

     COSTS AND EXPENSES. Borrower agrees to pay upon demand all of Lender's
     expenses, including without limitation attorneys' fees, incurred in
     connection with the preparation, execution, enforcement, modification
     and collection of this Agreement or in connection with the Loans made
     pursuant to this Agreement. Lender may pay someone else to help collect
     the Loans and to enforce this Agreement, and Borrower will pay that
     amount. This includes, subject to any limits under applicable law,
     Lender's attorneys' fees and Lender's legal expenses, whether or not
     there is a lawsuit, including attorneys' fees for bankruptcy proceedings
     (including efforts to modify or vacate any automatic stay or injunction),
     appeals, and any anticipated post-judgment collection services. Borrower
     also will pay any court costs, in addition to all other sums provided by
     law.

     NOTICES. All notices required to be given under this Agreement shall be
     given in writing, may be sent by telefacsimile (unless otherwise required
     by law), and shall be effective when actually delivered or when
     deposited with a nationally recognized overnight courier or deposited in
     the United States mail, first class, postage prepaid, addressed to the
     party to whom the notice is to be given at the address shown above. Any
     party may change its address for notices under this Agreement by giving
     formal written notice to other parties, specifying that the purpose of
     the notice is to change the party's address. To the extent permitted by
     applicable law, if there is more than one Borrower, notice to any
     Borrower will constitute notice to all Borrowers. For notice purposes,
     Borrower will keep Lender informed at all times of Borrower's current
     address(es).

     SEVERABILITY. If a court of competent jurisdiction finds any provision
     of this Agreement to be invalid or unenforceable as to any person or
     circumstance, such finding shall not render that provision invalid or
     unenforceable as to any other persons or circumstances. If feasible, any
     such offending provision shall be deemed to be modified to be within the
     limits of enforceability or validity; however, if the offending provision
     cannot be so modified, it shall be stricken and all other provisions of
     this Agreement in all other respects shall remain valid and enforceable.

     SUBSIDIARIES AND AFFILIATES OF BORROWER. To the extent the context of
     any provisions of this Agreement makes it appropriate, including without
     limitation any representation, warranty or covenant, the word "Borrower"
     as used herein shall include all subsidiaries and affiliates of
     Borrower. Notwithstanding the foregoing however, under no circumstances
     shall this Agreement be construed to require Lender to make any Loan or
     other financial accommodation to any subsidiary or affiliate of Borrower.

     SUCCESSORS AND ASSIGNS. All covenants and agreements contained by or on
     behalf of Borrower shall bind its successors and assigns and shall inure
     to the benefit of Lender, its successors and assigns. Borrower shall
     not, however, have the right to assign its rights under this Agreement
     or any interest therein, without the prior written consent of Lender.

     SURVIVAL. All warranties, representations, and covenants made by
     Borrower in this Agreement or in any certificate or other instrument
     delivered by Borrower to Lender under this Agreement shall be considered
     to have been relied upon by Lender and will survive the making of the
     Loan and delivery to Lender of the Related Documents, regardless of any
     investigation made by Lender or on Lender's behalf.

     TIME IS OF THE ESSENCE. Time is of the essence in the performance of
     this Agreement.

     WAIVER. Lender shall not be deemed to have waived any rights under this
     Agreement unless such waiver is given in writing and signed by Lender.
     No delay or omission on the part of Lender in exercising any right
     shall operate as a waiver of such right or any other right. A waiver by
     lender of a provision of this Agreement shall not prejudice or
     constitute a waiver of Lender's right otherwise to demand strict
     compliance with that provision or any other provision of this Agreement.
     No prior waiver by Lender, nor any course of dealing between Lender and
     Borrower, or between Lender and any Grantor, shall constitute a waiver
     of any of Lender's rights or of any obligations of Borrower or of any
     Grantor as to any future transactions. Whenever the consent of Lender is
     required under this Agreement, the granting of such consent by Lender in
     any instance shall not constitute continuing consent in subsequent
     instances where such consent is required, and in all cases such consent
     may be granted or

<PAGE>

                                                                          PAGE 7


     withheld in the sole discretion of Lender.

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN
AGREEMENT, AND BORROWER AGREES TO ITS TERMS. THIS AGREEMENT IS DATED AS OF
JULY 20, 1998.

BORROWER:

CR Technology, Inc.

By:      /s/ R. E. Amtower
   ----------------------------------------------------
   Richard E. Amtower, President & Assistant Secretary

LENDER:
California United Bank

By:
   ----------------------------------------------------
   Authorized Officer

<PAGE>

CALIFORNIA UNITED BANK

                               PROMISSORY NOTE
================================================================================

Borrower:  CR Technology, Inc.         Lender:  California United Bank
           27752 El Lazo Road                   Orange County Commercial Loan
           Laguna Nigel, CA 92677-3914            Center
                                                16030 Ventura Boulevard
                                                Encino, CA 91436

================================================================================

Principal Amount: $1,500,000.00 Initial Rate: 8.500% Date of Note: July 20, 1998

PROMISE TO PAY.  CR Technology, Inc. ("Borrower") promises to pay to California
United Bank ("Lender"), or order, in lawful money of the United States of
America, the principal amount of One Million Five Hundred Thousand & 00/100
Dollars ($1,500,000.00) or so much as may be outstanding, together with interest
on the unpaid outstanding principal balance of each advance.  Interest shall be
calculated from the date of each advance until repayment of each advance.

PAYMENT.  Borrower will pay this loan on demand, or if no demand is made, in one
payment of all outstanding principal plus all accrued unpaid interest on August
2, 1999.  In addition, Borrower will pay regular monthly payments of accrued
unpaid interest beginning September 2, 1998, and all subsequent interest
payments are due on the same day of each month after that.  The annual interest
rate for this Note is computed on a 365/360 basis; that is, by applying the
ratio of the annual interest rate over a year of 360 days, multiplied by the
outstanding principal balance, multiplied by the actual number of days the
principal balance is outstanding.  Borrower will pay Lender at Lender's address
shown above or at such other place as Lender may designate in writing.  Unless
otherwise agreed or required by applicable law, payments will be applied first
to any unpaid collection costs and any late charges, then to any unpaid
interest, and any remaining amount to principal.  The receipt of any wire
transfer of funds, check or other item of payment by the bank shall be
immediately applied to conditionally reduce Borrower's obligations, but shall
not be considered a payment on account unless such wire transfer is of
immediately available federal funds and is made to the appropriate deposit
account of Bank or unless and until such check or other item of payment is
honored when presented for payment.

VARIABLE INTEREST RATE.  The interest rate on this Note is subject to change
from time to time based on changes in an independent index which is the prime
rate published on a daily basis in the "Money Rates" section of the Western
Edition of The Wall Street Journal (the "Index").  The Index is not
necessarily the lowest rate charged by Lender on its loans.  If the index
becomes unavailable during the term of this loan, Lender may designate a
substitute index after notice to Borrower.  Lender will tell Borrower the
current Index rate upon Borrower's request.  Borrower understands that Lender
may make loans based on other rates as well.  The interest rate change will
not occur more often than each day.  THE INDEX CURRENTLY IS 8.500%.  THE
INTEREST RATE TO BE APPLIED TO THE UNPAID PRINCIPAL BALANCE OF THIS NOTE WILL
BE AT A RATE EQUAL TO THE INDEX, RESULTING IN AN INITIAL RATE OF 8.500%.
NOTICE:  Under no circumstances will the interest rate on this Note be more
than the maximum rate allowed by applicable law.

PREPAYMENT; MINIMUM INTEREST CHARGE.  In any event, even upon full prepayment
of this Note, Borrower understands that Lender is entitled to a minimum
interest charge of $250.00.  Other than Borrower's obligation to pay any
minimum interest charge, Borrower may pay without penalty all or a portion of
the amount owed earlier than it is due.  Early payments will not, unless
agreed to by Lender in writing, relieve Borrower of Borrower's obligation to
continue to make payments of accrued unpaid interest.  Rather, they will
reduce the principal balance due.

LATE CHARGE.  If a payment is 10 DAYS OR MORE LATE, Borrower will be charged
5.000% OF THE UNPAID PORTION OF THE REGULARLY SCHEDULED PAYMENT.

DEFAULT.  Borrower will be in default if any of the following happens:  (a)
Borrower fails to make any payment when due,  (b) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform when
due any other term, obligation, covenant, or condition contained in this Note or
any agreement related to this Note, or in any other agreement or loan Borrower
has with Lender,  (c) Borrower defaults under any loan, extension of credit,
security agreement, purchase or sales agreement, or any other agreement, in
favor of any other creditor or person that may materially affect any of
Borrower's property or Borrower's ability to repay this Note or perform
Borrower's obligations under this Note or any of the Related Documents,  (d) Any
representation or statement made or furnished to Lender by Borrower or on
Borrower's behalf is false or misleading in any material respect either now or
at the time made or furnished,  (e) Borrower becomes insolvent, a receiver is
appointed for any part of Borrower's property, Borrower makes an assignment for
the benefit of creditors, or any proceeding is commenced either by Borrower or
against Borrower under any bankruptcy or insolvency laws,  (f) Any creditor
tries to take any of Borrower's property on or in which Lender has a lien or
security interest.  This includes a garnishment of any of Borrower's accounts
with Lender,  (g) Any guarantor dies or any of the other events described in
this default section occurs with respect to any guarantor of this Note,  (h) A
material adverse change occurs in Borrower's financial condition, or Lender
believes the prospect of payment or performance of the Indebtedness is impaired,
(i) Lender in good faith deems itself insecure.

LENDER'S RIGHTS.  Upon default, Lender may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest immediately due, without
notice, and then Borrower will pay that amount.  Upon Borrower's failure to pay
all amounts declared due pursuant to this section, including failure to pay upon
final maturity, Lender, at its option, may also, if permitted under applicable
law, do one or both of the following:  (a) increase the variable interest rate
on this Note to 5.000 percentage points over the Index, and (b) add any unpaid
accrued interest to principal and such sum will bear interest therefrom until
paid at the rate provided in this Note (including any increased rate).  Lender
may hire or pay someone else to help collect this Note if Borrower does not pay.
Borrower also will pay Lender that amount.  This includes, subject to any limits
under applicable law, Lender's attorneys' fees and Lender's legal expenses
whether or not there is a lawsuit, including attorneys' fees and legal expenses
for bankruptcy proceedings (including efforts to modify or vacate any automatic
stay or injunction), appeals, and any anticipated post-judgment collection
services.  Borrower also will pay any court costs, in addition to all other sums
provided by law.  THIS NOTE HAS BEEN DELIVERED TO LENDER AND ACCEPTED BY LENDER
IN THE STATE OF CALIFORNIA.  IF THERE IS A LAWSUIT, BORROWER AGREES UPON
LENDER'S REQUEST TO SUBMIT TO THE JURISDICTION OF THE COURTS OF LOS ANGELES
COUNTY, THE STATE OF CALIFORNIA.  SUBJECT TO THE PROVISIONS ON ARBITRATION, THIS
NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF CALIFORNIA.

RIGHT OF SETOFF.  Borrower grants to Lender a contractual security interest in,
and hereby assigns, conveys, delivers, pledges, and transfers to Lender all
Borrower's right, title and interest in and to, Borrower's accounts with Lender
(whether checking, savings, or some other account), including without limitation
all accounts held jointly with someone else and all accounts Borrower may open
in the future, excluding however all IRA and Keogh accounts, and all trust
accounts for which the grant of a security interest would be prohibited by law.
Borrower authorizes Lender, to the extent permitted by applicable law, to
charge or setoff all sums owing on this Note against any and all such accounts.

LINE OF CREDIT.  This Note evidences a revolving line of credit.  Advances under
this Note may be requested orally by Borrower or by an authorized person.
Lender may, but need not, require that all oral requests be confirmed in
writing.  All communications, instructions, or directions by telephone or
otherwise to Lender are to be directed to Lender's officer shown above.  The
following party or parties are authorized to request advances under the line
<PAGE>

                                                                         PAGE 2
================================================================================
of credit until Lender receives from Borrower at Lender's address shown above
written notice of revocation of their authority:  Richard E. Amtower, President
& Secretary; and Maria Molak, Controller.  Borrower agrees to be liable for all
sums either:  (a) advanced in accordance with the instructions of an authorized
person or (b) credited to any of Borrower's accounts with Lender.  The unpaid
principal balance owing on this Note at any time may be evidenced by
endorsements on this Note or by Lender's internal records, including daily
computer print-outs.  Lender will have no obligation to advance funds under this
Note if:  (a) Borrower or any guarantor is in default under the terms of this
Note or any agreement that Borrower or any guarantor has with Lender, including
any agreement made in connection with the signing of this Note;  (b) Borrower or
any guarantor ceases doing business or is insolvent;  (c) any guarantor seeks,
claims or otherwise attempts to limit, modify or revoke such guarantor's
guarantee of this Note or any other loan with Lender;  (d) Borrower has applied
funds provided pursuant to this Note for purposes other than those authorized by
Lender; or (e) Lender in good faith deems itself insecure under this Note or any
other agreement between Lender and Borrower.

ARBITRATION.  LENDER AND BORROWER AGREE THAT ALL DISPUTES, CLAIMS AND
CONTROVERSIES BETWEEN THEM, WHETHER INDIVIDUAL, JOINT, OR CLASS IN NATURE,
ARISING FROM THIS NOTE OR OTHERWISE, INCLUDING WITHOUT LIMITATION CONTRACT
AND TORT DISPUTES, SHALL BE ARBITRATED PURSUANT TO THE RULES OF THE AMERICAN
ARBITRATION ASSOCIATION, UPON REQUEST OF EITHER PARTY.  No act to take or
dispose of any collateral securing this Note shall constitute a waiver of
this arbitration agreement or be prohibited by this arbitration agreement.
This includes, without limitation, obtaining injunctive relief or a temporary
restraining order; invoking a power of sale under any deed of trust or
mortgage; obtaining a writ of attachment or imposition of a receiver; or
exercising any rights relating to personal property, including taking or
disposing of such property with or without judicial process pursuant to
Article 9 of the Uniform Commercial Code.  Any disputes, claims, or
controversies concerning the lawfulness or reasonableness of any act, or
exercise of any right, concerning any collateral securing this Note,
including any claim to rescind, reform, or otherwise modify any agreement
relating to the collateral securing this Note, shall also be arbitrated,
provided however that no arbitrator shall have the right or the power to
enjoin or restrain any act of any party.  Lender and Borrower agree that in
the event of an action for judicial foreclosure pursuant to California Code
of Civil Procedure Section 726, or any similar provision in any other state,
the commencement of such an action will not constitute a waiver of the right
to arbitrate and the court shall refer to arbitration as much of such action,
including counterclaims, as lawfully may be referred to arbitration.
Judgment upon any award rendered by any arbitrator may be entered in any
court having jurisdiction.  Nothing in this Note shall preclude any party
from seeking equitable relief from a court of competent jurisdiction.  The
statute of limitations, estoppel, waiver, laches, and similar doctrines which
would otherwise be applicable in an action brought by a party shall be
applicable in any arbitration proceeding, and the commencement of an
arbitration proceeding shall be deemed the commencement of an action for
these purposes.  The Federal Arbitration Act shall apply to the construction,
interpretation, and enforcement of this arbitration provision.

BUSINESS LOAN AGREEMENT.  Reference is made to that certain Business Loan
Agreement, dated as of July 20, 1998, as it may be amended, modified,
supplemented, replaced, or restated, from time to time, ("Business Loan
Agreement") for additional terms and conditions.  Capitalized terms used but
not defined herein shall have the meanings given to them in the Business Loan
Agreement.

COLLATERAL.  This Note is secured by the Collateral as described in that certain
Commercial Security Agreement, dated as of July 20, 1998, as it may be amended,
modified, supplemented, replaced, or restated, from time to time, executed by
Grantor in favor of Lender.

OUT OF DEBT PROVISION.  Borrower shall maintain a zero balance on the revolving
line of credit for a period of at least thirty (30) consecutive days during the
term of this loan.

ADDITIONAL MATTERS.  Lender reserves the right to sell, assign, transfer,
negotiate or grant participations in all or any part of, or any interest in
Lender's rights and benefits hereunder.  In connection therewith, Lender may
disclose all documents and information which Lender now or hereafter may have
relating to Borrower.

GENERAL PROVISIONS.  This Note is payable on demand.  The inclusion of specific
default provisions or rights of Lender shall not preclude Lender's right to
declare payment of this Note on its demand.  Lender may delay or forgo enforcing
any of its rights or remedies under this Note without losing them.  Borrower
and any other person who signs, guarantees or endorses this Note, to the extent
allowed by law, waive any applicable statute of limitations, presentment, demand
for payment, protest and notice of dishonor.  Upon any change in the terms of
this Note, and unless otherwise expressly stated in writing, no party who signs
this Note, whether as maker, guarantor, accommodation maker or endorser, shall
be released from liability.  All such parties agree that Lender may renew or
extend (repeatedly and for any length of time) this loan, or release any party
or guarantor or collateral; or impair, fail to realize upon or perfect Lender's
security interest in the collateral; and take any other action deemed necessary
by Lender without the consent of or notice to anyone.  All such parties also
agree that Lender may modify this loan without the consent of or notice to
anyone other than the party with whom the modification is made.

INTEGRATION; AMENDMENT.  This Note and the other written documents and
instruments between Borrower and Lender set forth in full the terms of
agreement between the parties and are intended as the full, complete and
exclusive agreement governing the relationship between the parties.  This
Note supersedes all prior discussions, promises, representations, warranties,
agreements and understandings between the parties. This Note may not be
modified or amended, nor may any rights hereunder be waived, except in a
writing signed by the party against whom enforcement of the modification,
amendment or waiver is sought.  No course of dealing between the parties, no
usage of trade, and no parol or extrinsic evidence of any nature shall be
used or be relevant to supplement, explain or modify any term or provision of
this Note or any supplement or amendment hereto.  There are no oral
agreements or understandings between Borrower and Lender regarding any
extension of the maturity of this Note or making any modifications to this
Note, or regarding any other matter.

MUTUAL WAIVER OF RIGHT TO JURY TRIAL.  Lender and Borrower each hereby waive
the right to trial by jury in any action or proceeding based upon, arising out
of, or in any way relating to:  (i) this Note; or (ii) any other present or
future instrument or agreement between Lender and Borrower; or (iii) any
conduct, acts or omissions of Lender or Borrower or any of their directors,
officers, employees, agents, attorneys or any other persons affiliated with
Lender or Borrower; in each of the foregoing cases, whether sounding in
contract or tort or otherwise.

<PAGE>

                                                                     Page 3

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS
OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER
AGREES TO THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED COPY
OF THE NOTE.

BORROWER:
CR Technology, Inc.

By: /s/ R.E. Amtower
   -------------------------------------
   Richard E. Amtower, President & Assistant Secretary

LENDER:
California United Bank

By: /s/ [ILLEGIBLE]
   -------------------------------------
   Authorized Officer

<PAGE>

[LETTERHEAD]

                        COMMERCIAL SECURITY AGREEMENT
===============================================================================

Borrower: CR Technology, Inc.     Lender: California United Bank
          27752 El Lazo Road              Orange County Commercial Loan Center
          Laguna Nigel, CA 92677-3914     16030 Ventura Boulevard
                                          Encino, CA  91436
===============================================================================

THIS COMMERCIAL SECURITY AGREEMENT is entered into between CR Technology,
Inc. (referred to below as "Grantor"); and California United Bank (referred
to below as "Lender"). For valuable consideration, Grantor grants to Lender a
security interest in the Collateral to secure the indebtedness and agrees
that Lender shall have the rights stated in this Agreement with respect to
the Collateral, in addition to all other rights which Lender may have by law.

DEFINITIONS. The following words shall have the following meanings when used
in this Agreement. Terms not otherwise defined in this Agreement shall have
the meanings attributed to such terms in the Uniform Commercial Code. All
references to dollar amounts shall mean amounts in lawful money of the United
States of America.

     AGREEMENT. The word "Agreement" means this Commercial Security
     Agreement, as this Commercial Security Agreement may be amended or
     modified from time to time, together with all exhibits and schedules
     attached to this Commercial Security Agreement from time to time.

     COLLATERAL. The word "Collateral" means the following described property
     of Grantor, whether now owned or hereafter acquired, whether now
     existing or hereafter arising, and wherever located:

        All Debtor's present and future accounts, contract rights,
        instruments, documents, chattel paper, general intangibles
        (including, but not limited to, trademarks, tradenames, patents,
        copyrights and all other forms of intellectual property, and tax
        refunds), returned and repossessed goods and all Debtor's rights as a
        seller of goods; all collateral securing any of the foregoing; all
        deposit accounts, special and general, whether on deposit with
        Secured Party or others; all present and future letters of credit;

        All Debtor's now owned or hereafter acquired inventory, including raw
        materials, work in progress and finished goods, wherever located all
        shipping and packing supplies used or usable in connection with the
        sale of inventory; all Debtor's present and future claims against any
        supplier of any of the foregoing, including claims arising out of
        purchases by Debtor of defective goods or overpayments to or
        undershipments by suppliers; all proceeds arising from the lease or
        rental of any of the foregoing;

        All Debtor's now owned and hereafter acquired equipment, including
        furniture, fixtures, and motor vehicles, NONE OF WHICH THE DEBTOR IS
        AUTHORIZED TO SELL, LEASE OR DISPOSE OF WITHOUT THE WRITTEN CONSENT
        OF SECURED PARTY. All present and future warranty and other claims
        which Debtor may have against any vendor or lessor of any of the
        foregoing;
        All cash and non-cash proceeds of any of the foregoing, in whatever
        form (including proceeds in the form of inventory, equipment or any
        other form of personal property, and insurance proceeds), including
        proceeds of proceeds;

        All books and records of any kind relating to any of the foregoing
        collateral, and all computers and other equipment (and computer
        software used in connection therewith) used in connection with
        recordkeeping for the collateral.

In addition, the word "Collateral" includes all the following, whether now
owned or hereafter acquired, whether now existing or hereafter arising, and
wherever located:

        (a) All attachments, accessions, accessories, tools, parts, supplies,
        increases, and additions to and all replacements of and substitutions
        for any property described above.

        (b) All products and produce of any of the property described in this
        Collateral section.

        (c) All accounts, general intangibles, instruments, rents, monies,
        payments, and all other rights, arising out of a sale, lease, or
        other disposition of any of the property described in this Collateral
        section.

        (d) All proceeds (including insurance proceeds) from the sale,
        destruction, loss, or other disposition of any of the property
        described in this Collateral section.

        (e) All records and data relating to any of the property described in
        this Collateral section, whether in the form of a writing,
        photograph, microfilm, microfiche, or electronic media, together with
        all of Grantor's right, title, and interest in and to all computer
        software required to utilize, create, maintain, and process any such
        records or data on electronic media.

EVENT OF DEFAULT. The words "Event of Default" mean and include without
limitation any of the Events of Default set forth below in the section titled
"Events of Default."

GRANTOR. The word "Grantor" means CR Technology, Inc., its successors and
assigns

GUARANTOR. The word "Guarantor" means and includes without limitation each
and all of the guarantors, sureties, and accommodation parties in connection
with the indebtedness.

INDEBTEDNESS. The word "Indebtedness" means the indebtedness evidenced by the
Note, including all principal and interest, together with all other
indebtedness and costs and expenses for which Grantor is responsible under
this Agreement or under any of the Related Documents. In addition, the word
"Indebtedness" includes all other obligations, debts and liabilities, plus
interest thereon, of Grantor, or any one or more of them, to Lender, as well
as all claims by Lender against Grantor, or any one or more of them, whether
existing now or later; whether they are voluntary or involuntary, due or not
due, direct or indirect, absolute or contingent, liquidated or unliquidated;
whether Grantor may be liable individually or jointly with others; whether
Grantor may be obligated as guarantor, surety, accommodation party or
otherwise; whether recovery upon such indebtedness may be or hereafter may
become barred by any statute of limitations; and whether such indebtedness may
be or hereafter may become otherwise unenforceable.

LENDER. The word "Lender" means California United Bank, its successors and
assigns.

NOTE. The word "Note" means the Borrower's promissory notes or credit
agreements, if any, evidencing Borrower's loan obligations, together with all
renewals of, extensions of, modifications of, refinancings of, consolidations
of and substitutions for the notes or credit agreements.


<PAGE>

                       COMMERCIAL SECURITY AGREEMENT                    PAGE 2
                               (CONTINUED)

LOAN NO. 6889
------------------------------------------------------------------------------
    RELATED DOCUMENTS. The words "Related Documents" mean and include
    without limitation all promissory notes, credit agreements, loan
    agreements, environmental agreements, guaranties, security agreements,
    mortgages, deeds of trust, and all other instruments, agreements and
    documents, whether now or hereafter existing, executed in connection
    with the indebtedness.

RIGHT OF SETOFF. Grantor hereby grants Lender a contractual security interest
in and hereby assigns, conveys, delivers, pledges, and transfers all of
Grantor's right, title and interest in and to Grantor's accounts with Lender
(whether checking, savings, or some other account), including all accounts
held jointly with someone else and all accounts Grantor may open in the
future, excluding, however, all IRA and Keogh accounts, and all trust
accounts for which the grant of a security interest would be prohibited by
law. Grantor authorizes Lender, to the extent permitted by applicable law, to
charge or setoff all indebtedness against any and all such accounts.

OBLIGATIONS OF GRANTOR. Grantor warrants and covenants to Lender as follows:

    PERFECTION OF SECURITY INTEREST. Grantor agrees to execute such financing
    statements and to take whatever other actions are requested by Lender to
    perfect and continue Lender's security interest in the Collateral. Upon
    request of Lender, Grantor will deliver to Lender any and all of the
    documents evidencing or constituting the Collateral, and Grantor will
    note Lender's interest upon any and all chattel paper if not delivered to
    Lender for possession by Lender. Grantor hereby appoints Lender as its
    irrevocable attorney-in-fact for the purpose of executing any documents
    necessary to perfect or to continue the security interest granted in this
    Agreement. Lender may at any time, and without further authorization from
    Grantor, file a carbon, photographic or other reproduction of any
    financing statement or of this Agreement for use as a financing statement.
    Grantor will reimburse Lender for all expenses for the perfection and the
    continuation of the perfection of Lender's security interest in the
    Collateral. Grantor promptly will notify Lender before any change in
    Grantor's name including any change to the assumed business names of
    Grantor. THIS IS A CONTINUING SECURITY AGREEMENT AND WILL CONTINUE IN
    EFFECT EVEN THOUGH ALL OR ANY PART OF THE INDEBTEDNESS IS PAID IN FULL AND
    EVEN THOUGH FOR A PERIOD OF TIME GRANTOR MAY NOT BE INDEBTED TO LENDER.

    NO VIOLATION. The execution and delivery of this Agreement will not
    violate any law or agreement governing Grantor or to which Grantor is a
    party, and its certificate or articles of incorporation and bylaws do not
    prohibit any term or condition of this Agreement.

    ENFORCEABILITY OF COLLATERAL. To the extent the Collateral consists of
    accounts, chattel paper, or general intangibles, the Collateral is
    enforceable in accordance with its terms, is genuine, and complies with
    applicable laws concerning form, content and manner of preparation and
    execution, and all persons appearing to be obligated on the Collateral
    have authority and capacity to contract and are in fact obligated as they
    appear to be on the Collateral.

    LOCATION OF THE COLLATERAL. Grantor, upon request of Lender, will deliver
    to Lender in form satisfactory to Lender a schedule of real properties
    and Collateral locations relating to Grantor's operations, including
    without limitation the following: (a) all real property owned or being
    purchased by Grantor; (b) all real property being rented or leased by
    Grantor; (c) all storage facilities owned, rented, leased, or being used
    by Grantor; and (d) all other properties where Collateral is or may be
    located. Except in the ordinary course of its business, Grantor shall not
    remove the Collateral from its existing locations without the prior
    written consent of Lender.

    REMOVAL OF COLLATERAL. Grantor shall keep the Collateral (or to the extent
    the Collateral consists of intangible property such as accounts, the
    records concerning the Collateral) at Grantor's address shown above, or
    at such other locations as are acceptable to Lender. Except in the
    ordinary course of its business, including the sales of inventory,
    Grantor shall not remove the Collateral from its existing locations
    without the prior written consent of Lender. To the extent that the
    Collateral consists of vehicles, or other titled property, Grantor shall
    not take or permit any action which would require application for
    certificates of title for the vehicles outside the State of California,
    without the prior written consent of Lender.

    TRANSACTIONS INVOLVING COLLATERAL. Except for inventory sold or accounts
    collected in the ordinary course of Grantor's business, Grantor shall
    not sell, offer to sell, or otherwise transfer or dispose of the
    Collateral. While Grantor is not in default under this Agreement, Grantor
    may sell inventory, but only in the ordinary course of its business and
    only to buyers who qualify as a buyer in the ordinary course of business.
    A sale in the ordinary course of Grantor's business does not include a
    transfer in partial or total satisfaction of a debt or any bulk sale.
    Grantor shall not pledge, mortgage, encumber or otherwise permit the
    Collateral to be subject to any lien, security interest, encumbrance, or
    charge, other than the security interest provided for in this Agreement,
    without the prior written consent of Lender. This includes security
    interests even if junior in right to the security interests granted under
    this Agreement. Unless waived by Lender, all proceeds from any disposition
    of the Collateral (for whatever reason) shall be held in trust for Lender
    and shall not be commingled with any other funds; provided, however, this
    requirement shall not constitute consent by Lender to any sale or other
    disposition. Upon receipt, Grantor shall immediately deliver any such
    proceeds to Lender.

    TITLE. Grantor represents and warrants to Lender that it holds good and
    marketable title to the Collateral, free and clear of all liens and
    encumbrances except for the lien of this Agreement. No financing statement
    covering any of the Collateral is on file in any public office other than
    those which reflect the security interest created by this Agreement or
    to which Lender has specifically consented. Grantor shall defend Lender's
    rights in the Collateral against the claims and demands of all other
    persons.

    COLLATERAL SCHEDULES AND LOCATIONS. Insofar as the Collateral consists of
    inventory, Grantor shall deliver to Lender, as often as Lender shall
    require, such lists, descriptions, and designations of such Collateral as
    Lender may require to identify the nature, extent, and location of such
    Collateral. Such information shall be submitted for Grantor and each of
    its subsidiaries or related companies.

    MAINTENANCE AND INSPECTION OF COLLATERAL. Grantor shall maintain all
    tangible Collateral in good condition and repair. Grantor will not commit
    or permit damage to or destruction of the Collateral or any part of the
    Collateral. Lender and its designated representatives and agents shall
    have the right at all reasonable times to examine, inspect, and audit the
    Collateral wherever located. Grantor shall immediately notify Lender of
    all cases involving the return, rejection, repossession, loss or damage
    of or to any Collateral; of any request for credit or adjustment or of any
    other dispute arising with respect to the Collateral; and generally of
    all happenings and events affecting the Collateral or the value or the
    amount of the Collateral.

    TAXES, ASSESSMENTS AND LIENS. Grantor will pay when due all taxes,
    assessments and liens upon the Collateral, its use or operation, upon this
    Agreement, upon any promissory note or notes evidencing the indebtedness,
    or upon any of the other Related Documents. Grantor may withhold any such
    payment or may elect to contest any lien if Grantor is in good faith
    conducting an appropriate proceeding to contest the obligation to pay and
    so long as Lender's interest in the Collateral is not jeopardized in
    Lender's sole opinion. If the Collateral is subjected to a lien which is
    not discharged within fifteen (15) days, Grantor shall deposit with Lender
    cash, a sufficient corporate surety bond or other security satisfactory to
    Lender in an amount adequate to provide for the discharge of the lien
    plus any interest, costs, attorneys' fees or other charges that could
    accrue as a result of foreclosure or sale of the Collateral. In any
    contest Grantor shall defend itself and Lender and shall satisfy any final
    final adverse judgment before enforcement against the Collateral. Grantor
    shall name Lender as an additional obligee under any surety bond furnished
    in the contest proceedings.

    COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS. Grantor shall comply promptly
    with all laws, ordinances, rules and regulations of all governmental
    authorities, now or hereafter in effect, applicable to the ownership,
    production, or use of the Collateral. Grantor may contest in good faith
    any such law, ordinance or regulation and withhold compliance during any
    proceeding, including appropriate appeals, so long as Lender's interest in
    the Collateral, in Lender's opinion, is not jeopardized.

    HAZARDOUS SUBSTANCES. Grantor represents and warrants that the Collateral
    never has been, and never will be so long as this Agreement

<PAGE>

                       COMMERCIAL SECURITY AGREEMENT                    PAGE 3
                               (CONTINUED)

LOAN NO. 6889
------------------------------------------------------------------------------
    for any part of Grantor's property, any assignment for the benefit of
    creditors, any type of creditor workout, or the commencement of any
    proceeding under any bankruptcy or insolvency laws by or against Grantor.

    CREDITOR OR FORFEITURE PROCEEDINGS. Commencement of foreclosure or
    forfeiture proceedings, whether by judicial proceeding, self-help,
    repossession or any other method, by any creditor of Grantor or by any
    governmental agency against the Collateral or any other collateral
    securing the indebtedness. This includes a garnishment of any of Grantor's
    deposit accounts with Lender.

    EVENTS AFFECTING GUARANTOR. Any of the preceding events occurs with
    respect to any Guarantor of any of the indebtedness or such Guarantor
    dies or becomes incompetent.

    ADVERSE CHANGE. A material adverse change occurs in Grantor's financial
    condition, or Lender believes the prospect of payment or performance of
    the indebtedness is impaired.

    INSECURITY. Lender, in good faith, deems itself insecure.

RIGHTS AND REMEDIES ON DEFAULT. If an Event of Default occurs under this
Agreement, at any time thereafter, Lender shall have all the rights of a
secured party under the California Uniform Commercial Code. In addition and
without limitation, Lender may exercise any one or more of the following
rights and remedies:

    ACCELERATE INDEBTEDNESS. Lender may declare the entire indebtedness,
    including any prepayment penalty which Grantor would be required to
    pay, immediately due and payable, without notice.

    ASSEMBLE COLLATERAL. Lender may require Grantor to deliver to Lender all
    or any portion of the Collateral and any and all certificates of title and
    other documents relating to the Collateral. Lender may require Grantor to
    assemble the Collateral and make it available to Lender at a place to be
    designated by Lender. Lender also shall have full power to enter upon the
    property of Grantor to take possession of and remove the Collateral. If
    the Collateral contains other goods not covered by this Agreement at the
    time of repossession, Grantor agrees Lender may take such other goods,
    provided that Lender makes reasonable efforts to return them to Grantor
    after repossession.

    SELL THE COLLATERAL. Lender shall have full power to sell, lease,
    transfer, or otherwise deal with the Collateral or proceeds thereof in its
    own name or that of Grantor. Lender may sell the Collateral at public
    auction or private sale. Unless the Collateral threatens to decline
    speedily in value or is of a type customarily sold on a recognized
    market, Lender will give Grantor reasonable notice of the time after
    which any private sale or any other intended disposition of the
    Collateral is to be made. The requirements of reasonable notice shall be
    met if such notice is given at least ten (10) days, or such lesser time
    as required by state law, before the time of the sale or disposition. All
    expenses relating to the disposition of the Collateral, including without
    limitation the expenses of retaking, holding, insuring, preparing for
    sale and selling the Collateral, shall become a part of the indebtedness
    secured by this Agreement and shall be payable on demand, with interest
    at the Note rate from date of expenditure until repaid.

    APPOINT RECEIVER. To the extent permitted by applicable law, Lender shall
    have the following rights and remedies regarding the appointment of a
    receiver: (a) Lender may have a receiver appointed as a matter of right,
    (b) the receiver may be an employee of Lender and may serve without bond,
    and (c) all fees of the receiver and his or her attorney shall become
    part of the indebtedness secured by this Agreement and shall be payable on
    demand, with interest at the Note rate from date of expenditure until
    repaid.

    COLLECT REVENUES, APPLY ACCOUNTS. Lender, either itself or through a
    receiver, may collect the payments, rents, income, and revenues from the
    Collateral. Lender may at any time in its discretion transfer any
    Collateral into its own name or that of its nominee and receive the
    payments, rents, income, and revenues therefrom and hold the same
    as security for the indebtedness or apply it to payment of the
    indebtedness in such order of preference as Lender may determine. Insofar
    as the Collateral consists of accounts, general intangibles, insurance
    policies, instruments, chattel paper, choses in action, or similar
    property, Lender may demand, collect, receipt for, settle, compromise,
    adjust, sue for, foreclose, or realize on the Collateral as Lender may
    determine, whether or not indebtedness or Collateral is then due. For
    these purposes, Lender may, on behalf of and in the name of Grantor,
    receive, open and dispose of mail addressed to Grantor; change any address
    to which mail and payments are to be sent; and endorse notes, checks,
    drafts, money orders, documents of title, instruments and items
    pertaining to payment, shipment, or storage of any Collateral. To
    facilitate collection, Lender may notify account debtors and obligors on
    any Collateral to make payments directly to Lender.

    OBTAIN DEFICIENCY. If Lender chooses to sell any or all of the Collateral,
    Lender may obtain a judgment against Grantor for any deficiency remaining
    on the indebtedness due to Lender after application of all amounts
    received from the exercise of the rights provided in this Agreement.
    Grantor shall be liable for a deficiency even if the transaction
    described in this subsection is a sale of accounts or chattel paper.

    OTHER RIGHTS AND REMEDIES. Lender shall have all the rights and remedies
    of a secured creditor under the provisions of the Uniform Commercial
    Code, as may be amended from time to time. In addition, Lender shall have
    and may exercise any or all other rights and remedies it may have
    available at law, in equity, or otherwise.

    CUMULATIVE REMEDIES. All of Lender's rights and remedies, whether
    evidenced by this Agreement or the Related Documents or by any other
    writing, shall be cumulative and may be exercised singularly or
    concurrently. Election by Lender to pursue any remedy shall not
    exclude pursuit of any other remedy, and an election to make expenditures
    or to take action to perform an obligation of Grantor under this
    Agreement, after Grantor's failure to perform, shall not affect Lender's
    right to declare a default and to exercise its remedies.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part
of this Agreement:

    AMENDMENTS. This Agreement, together with any Related Documents,
    constitutes the entire understanding and agreement of the parties as to
    the matters set forth in this Agreement. No alteration of or amendment to
    this Agreement shall be effective unless given in writing and signed by
    the party or parties sought to be charged or bound by the alteration or
    amendment.

    APPLICABLE LAW.  This Agreement has been delivered to Lender and accepted
    by Lender in the State of California. If there is a lawsuit, Grantor
    agrees upon Lender's request to submit to the jurisdiction of the courts
    of Los Angeles County, the State of California. Subject to the provisions
    on arbitration, this Agreement shall be governed by and construed
    in accordance with the laws of the State of California.

    ARBITRATION. LENDER AND GRANTOR AGREE THAT ALL DISPUTES, CLAIMS AND
    CONTROVERSIES BETWEEN THEM, WHETHER INDIVIDUAL, JOINT, OR CLASS IN
    NATURE, ARISING FROM THIS AGREEMENT OR OTHERWISE, INCLUDING WITHOUT
    LIMITATION CONTRACT AND TORT DISPUTES, SHALL BE ARBITRATED PURSUANT TO
    THE RULES OF THE AMERICAN ARBITRATION ASSOCIATION, UPON REQUEST OF EITHER
    PARTY. No act to take or dispose of any Collateral shall
    constitute a waiver of this arbitration agreement or be prohibited by
    this arbitration agreement. This includes, without limitation, obtaining
    injunctive relief or a temporary restraining order; invoking a power of
    sale under any deed of trust or mortgage; obtaining a writ of attachment
    or imposition of a receiver; or exercising any rights relating to
    personal property, including taking or disposing of such property with or
    without judicial process pursuant to Article 9 of the Uniform Commercial
    Code. Any disputes, claims, or controversies concerning the lawfulness or
    reasonableness of any act, or exercise of any right, concerning any
    Collateral, including any claim to rescind, reform, or otherwise modify
    any agreement relating to the Collateral, shall also be arbitrated,
    provided however that no arbitrator shall have the right or the power to
    enjoin or restrain any act of any party. Lender and Grantor agree that in
    the event of an action for judicial foreclosure pursuant to California
    Code of Civil Procedure Section 726, or any similar provision in any
    other state, the commencement of such an action will not constitute a
    waiver of the right to arbitrate and the court

<PAGE>

                       COMMERCIAL SECURITY AGREEMENT                    PAGE 5
                               (CONTINUED)

LOAN NO. 6889
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    shall refer to arbitration as much of such action, including counterclaims,
    as lawfully may be referred to arbitration. Judgment upon any award
    rendered by any arbitrator may be entered in any court having
    jurisdiction. Nothing in this Agreement shall preclude any party from
    seeking equitable relief from a court of competent jurisdiction. The
    statute of limitations, estoppel, waiver, laches, and similar doctrines
    which would otherwise be applicable in an action brought by a party shall
    be applicable in any arbitration proceeding, and the commencement of an
    arbitration proceeding shall be deemed the commencement of an action for
    these purposes. The Federal Arbitration Act shall apply to the
    construction, interpretation, and endorsement of this arbitration
    provision.

    ATTORNEYS' FEES; EXPENSES. Grantor agrees to pay upon demand all of
    Lender's costs and expenses, including attorneys' fees and Lender's legal
    expenses, incurred in connection with the enforcement of this Agreement.
    Lender may pay someone else to help enforce this Agreement, and Grantor
    shall pay the costs and expenses of such enforcement. Costs and expenses
    include Lender's attorneys' fees and legal expenses whether or not there
    is a lawsuit, including attorneys' fees and legal expenses for bankruptcy
    proceedings (and including efforts to modify or vacate any automatic stay
    or injunction), appeals, and any anticipated post-judgment collection
    services. Grantor also shall pay all court costs and such additional fees
    as may be directed by the court.

    CAPTION HEADINGS. Caption headings in this Agreement are for convenience
    purposes only and are not to be used to interpret or define the
    provisions of this Agreement.

    NOTICES. All notices required to be given under this Agreement shall be
    given in writing, may be sent by telefacsimile (unless otherwise required
    by law), and shall be effective when actually delivered or when deposited
    with a nationally recognized overnight courier or deposited in the United
    States mail, first class, postage prepaid, addressed to the party to whom
    the notice to be given at the address shown above. Any party may change
    its address for notices under this Agreement by giving formal written
    notice to the other parties, specifying that the purpose of the notice is
    to change the party's address. To the extent permitted by applicable law,
    if there is more than one Grantor, notice to any Grantor will constitute
    notice to all Grantors. For notice purposes, Grantor will keep Lender
    informed at all times of Grantor's current address(es).

    POWER OF ATTORNEY. Grantor hereby appoints Lender as its true and lawful
    attorney-in-fact, irrevocably, with full power of substitution to do the
    following: (a) to demand, collect, receive, receipt for, sue and recover
    all sums of money or other property which may now or hereafter become
    due, owing or payable from the Collateral; (b) to execute, sign and
    endorse any and all claims, instruments, receipts, checks, drafts or
    warrants issued in payment for the Collateral; (c) to settle or compromise
    any and all claims arising under the Collateral, and, in the place and
    stead of Grantor, to execute and deliver its release and settlement for
    the claim; and (d) to file any claim or claims or to take any action or
    institute or take part in any proceedings, either in its own name or in
    the name of Grantor, or otherwise, which in the discretion of Lender may
    seem to be necessary or advisable. This power is given as security for
    the indebtedness, and the authority hereby conferred is and shall be
    irrevocable and shall remain in full force and effect until renounced by
    Lender.

    PREFERENCE PAYMENTS. Any monies Lender pays because of an asserted
    preference claim in Borrower's bankruptcy will become a part of the
    indebtedness and, at Lender's option, shall be payable by Borrower as
    provided above in the "EXPENDITURES BY LENDER" paragraph.

    SEVERABILITY. If a court of competent jurisdiction finds any provision of
    this Agreement to be invalid or unenforceable as to any person or
    circumstance, such finding shall not render that provision invalid or
    unenforceable as to any other persons or circumstances. If feasible, any
    such offending provision shall be deemed to be modified to be within the
    limits of enforceability or validity; however, if the offending provision
    cannot be so modified, it shall be stricken and all other provisions of this
    Agreement in all other respects shall remain valid and enforceable.

    SUCCESSOR INTERESTS.  Subject to the limitations set forth above on
    transfer of the Collateral, this Agreement shall be binding upon and
    inure to the benefit of the parties, their successors and assigns.

    WAIVER. Lender shall not be deemed to have waived any rights under this
    Agreement unless such waiver is given in writing and signed by Lender. No
    delay or omission on the part of Lender in exercising any right shall
    operate as a waiver of such right or any other right. A waiver by Lender
    of a provision of this Agreement shall not prejudice or constitute a
    waiver of Lender's right otherwise to demand strict compliance with that
    provision or any other provision of this Agreement. No prior waiver by
    Lender, nor any course of dealing between Lender and Grantor, shall
    constitute a waiver of any of Lender's rights or of any of Grantor's
    obligations as to any future transactions. Whenever the consent of Lender
    is required under this Agreement, the granting of such consent by Lender
    in any instance shall not constitute continuing consent to subsequent
    instances where such consent is required and in all cases such consent
    may be granted or withheld in the sole discretion of Lender.

    WAIVER OF CO-OBLIGOR'S RIGHTS. If more than one person is obligated for
    the indebtedness, Borrower irrevocably waives, disclaims and relinquishes
    all claims against such other person which Borrower has or would otherwise
    have by virtue of payment of the indebtedness or any part thereof,
    specifically including but not limited to all rights of indemnity,
    contribution or exoneration.

GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS COMMERCIAL
SECURITY AGREEMENT, AND GRANTOR AGREES TO ITS TERMS. THIS AGREEMENT IS DATED
JULY 20, 1998.

GRANTOR:

CR TECHNOLOGY, INC.


BY: /s/ Richard E. Amtower
    ---------------------------------------------------
    Richard E. Amtower, President & Assistant Secretary

LENDER:

CALIFORNIA UNITED BANK


BY: -----------------------------------------------------
    Authorized Officer