ASSET TRANSFER AGREEMENT


     THIS AGREEMENT (the "Agreement") is made and entered into this First day of
July,  1998  by  and  between  Photomatrix,  Inc.  ("Purchaser"),  a  California
corporation, and MGM TechRep, Inc. ("Seller"), a California corporation.

                               B A C K G R O U N D

     A. Seller wishes to divest itself of certain assets and its  manufacturer's
rep business ("Business").

     B. Purchaser  wishes to acquire from Seller the Business and certain assets
from Seller.

                                A G R E E M E N T

     In consideration of the premises and the mutual covenants  contained herein
the parties hereto agree as follows:

                                   SECTION 1.

                           PURCHASE AND SALE OF ASSETS

         1.1 Sale of Assets. For the consideration  hereinafter  specified,  and
subject to the  provisions  herein  set forth,  at the  Closing  (as  defined in
Section 1.4 hereof), Seller shall sell, assign, convey, transfer, and deliver to
Purchaser, and the Purchaser shall purchase, accept, and acquire from Seller:

                  (a) the furniture,  fixtures and office  equipment,  and other
tangible  personal  property  listed  on  Schedule  1.1(a),  in  AS-IS  WHERE-IS
CONDITION (the "Equipment");

                  (b) the existing principal contracts listed on Schedule 1.1(b)
including all outstanding  quotes and pending orders  pursuant  thereto and upon
which commissions shall become payable (the "Contracts");

                  (c) the name "MGM TechRep" and all  associated  registrations,
listings,  qualifications and good will associated therewith and all proprietary
information that Seller may possess regarding its principals and customers;

                  (d) the  intangible  property  which  includes  the know  how,
design  rights,  plans,  specifications,  drawings,  quotes,  and trade secrets,
substantially  all of  which  Seller  acquired  from  Purchaser  and  which  are
presently used by Seller in the conduct of the Business.

         1.2 Assumed Liabilities. At the Closing, and upon the sale and purchase
of the Assets, Purchaser shall assume and agree to pay or discharge when due the
liabilities,  obligations, and contracts, listed on Schedule 1.2 hereof, and the
performance  obligations of Seller  pursuant to the contracts with principals to
the extent such  liabilities,  obligations,  and performance are attributable to
periods occurring after the Closing Date, (collectively, such


<PAGE>



obligations are hereinafter referred to as the "Assumed Liabilities"). Except as
expressly  provided in this Section 1.2, Purchaser does not and shall not assume
any  liabilities  or  obligations  of  Seller  whether  known,  unknown,  fixed,
contingent, liquidated,  unliquidated, disputed, or undisputed, and shall not be
obligated for any liability,  cost, or expense or required to defend any suit or
claim  arising out of any act,  event,  or  transaction  occurring  prior to the
closing  date  or out of any  condition  existing  prior  to the  Closing  Date,
notwithstanding  that the date on which the  claim,  demand,  or  obligation  is
asserted is after the Closing Date.  Purchaser  shall be responsible for all its
actions  initiated  and  conducted  subsequent  to the  Closing  Date and  shall
indemnify Seller from any such  obligations,  claims,  costs or liabilities that
arise from actions of the Purchaser subsequent to the Closing Date.

         1.3 Purchase  Price,  Payment.  The  purchase  price of the Assets (the
"Purchase Price"),  subject to the assumption of the Assumed Liabilities,  shall
be  pursuant  to  the   schedule   outlined  in  the  attached   Schedule   1.3.

         1.4 Closing  Effective  Date.  The Closing  for the  purchase  and sale
contemplated  by this  Agreement  (the  "Closing")  shall be July 1, 1998,  (the
"Closing Date" or the "Effective Date").

         1.5 Further  Assurances.  From time to time after the  Closing,  at the
request of either party hereto and without further consideration  therefor, each
party shall  execute and deliver  such further  instruments  and take such other
action as the other party may  reasonably  require to effectuate  the transation
contemplated by this Agreement. 

                                    SECTION 2

                               COVENANTS OF SELLER

         2.1      Noncompetition by Seller.

                  (a) The following terms are used in this Section 2.1, with the
meanings thereafter ascribed:

                          (i)  "Affiliate  of  Seller"  shall mean any person or
entity controlling,  controlled by, or under common control with Seller. As used
herein the term  "control"  as used in the  preceding  sentence  means  power by
virtue of familial  relationship,  contract,  security ownership,  position,  or
otherwise to influence,  direct,  or cause the direction of the  management  and
affairs of a person or entity.

                          (ii)  "Area"  shall  mean  a  500-mile  radius  of the
Purchaser's premises at 1958 Kellogg Ave., Carlsbad, California.

                          (iii)  "Business of the Seller"  means the business of
manufacturers' sales representative.

                          (iv)  "Competing  Business"  shall mean any  business,
person or entity  which is engaged in a business  substantially  the same as the
Business purchased by Purchaser.

                  (b) Seller covenants that, for a period of five (5) years from
and  after  the  Closing  Date,  it will  observe  the  following  separate  and
independent covenants:
<PAGE>

                          (i) Neither Seller,  nor any Affiliate of Seller will,
without the prior  written  consent of Purchaser,  within the Area,  directly of
indirectly,  on behalf  of  Seller  or in the  service  of  others,  (i)  become
financially  interested in a Competing  Business (other than as a holder of less
than five  percent of the  outstanding  voting  securities  or any entity  whose
voting securities are listed on a national  securities exchange or quoted by the
National  Association of Securities  Dealers,  Inc. automated quotation system),
or, (ii) engage in or be retained by any Competing Business.

                          (ii)   Seller   acknowledges   and  agrees   that  all
Confidential  Information of Seller, and all physical  embodiments  thereof, are
confidential to, and from and after the Closing Date and shall be and remain the
sole and exclusive  property of  Purchaser.  Seller agrees that Seller will not,
without the prior written  consent of Purchaser,  (i) disclose or make available
any Confidential Information of Purchaser to any person or entity (including any
Affiliate  of  Seller),  or (ii) make o cause to be made,  or permit,  either on
behalf of Seller or on behalf of others, any use of Confidential  Information of
Purchaser.

                          (iii)  Seller shall not use as a trade name or conduct
Business under the names of "MGM" or "MGM TechRep".

                  (c) Seller  acknowledges  that  Purchaser  will  engage in the
prior Business of the Seller  throughout the Area; that the within and foregoing
covenants  are made by Seller as an  inducement  to  Purchaser  to purchase  the
Assets and to protect and preserve to Purchaser  its interest in the Business of
the Seller including, particularly, the goodwill associated therewith; that each
of the above and foregoing covenants is reasonable and that irreparable loss and
injury would result should Selle breach any of the foregoing covenants.

                  (d)  Each of the  covenants  hereinabove  contained  shall  be
deemed  separate,  severable,  and independent  covenants,  and in the event any
covenant shall be declared invalid by any court of competent jurisdiction,  such
invalidity   shall  not  in  any  manner   affect  or  impair  the  validity  or
enforceability  of any other part or provision of such  covenant or of any other
covenant contained herein.

                  (e) In  addition to all other  remedies  provided at law or in
equity,   Purchaser  shall  be  entitled  to  both   preliminary  and  permanent
injunctions  against  Seller to prevent a breach of  contemplated  or threatened
breach by Seller of any of the  foregoing  covenants;  and the  existence or any
claim, demand,  cause of action, or action of Seller against Purchaser,  whether
predicated  upon this Agreement or otherwise,  shall not constitute a defense to
the enforcement by Purchaser of any such covenants.

         2.2 Seller's Agreement to Assist Purchaser.  Seller shall furnish leads
and quote packages to Purchaser that it may receive or acquire subsequent to the
Closing    Date   that   are   part   of   or    relate    to   the    Business.


         2.3 Financial Information.  Within thirty (30) days of Seller's written
request,  Purchaser  shall  furnish  with true and correct  copies of  financial
records and reports showing earnings from commissions and receipts of commission
payments  sufficient to substantiate  the amounts due and paid to Seller per the
terms of Schedule 1.3, except that Purchaser shall have no obligation to furnish
such financial information after June 30, 2001. 
<PAGE>

                                    SECTION 3
                                                         
                         REPRESENTATIONS AND WARRANTIES
                                  OF THE SELLER
                                                      
         For the purpose of inducing  Purchaser to enter into this Agreement and
consummate the transactions  contemplated hereby, Seller represents and warrants
to Purchaser  that:  

         3.1  Organization,  Power  and  Authority  of the  Seller.  Seller is a
corporation  duly organized and legally existing in good standing under the laws
of the State of California  and has full  corporate  power and authority and all
licenses and permits  necessary to own or lease its  properties  and to carry on
its Business as it is now being conducted.

         3.2  Ownership  of the  Assets.  The  Seller is the  lawful  record and
beneficial owner of the Assets and has valid marketable title thereto,  free and
clear of all liens, pledges, and encumbrances. 

         3.3  Litigation  Involving  the Seller.  There are no  actions,  suits,
claims,  governmental  investigations or arbitration  proceedings  (collectively
"Litigation")  pending or to the best of Seller's knowledge,  threatened against
or  affecting  the Assets,  or the ability of Seller to perform its  obligations
under this Agreement.  There are no outstanding orders,  decrees or stipulations
issued by any local,  state, or federal judicial  authority in any proceeding to
which the Seller is or was a party r which affect the A ssets, or the ability of
Seller to perform its obligations under this Agreement.  

         3.4  Compliance  with  Laws by the  Seller.  To the  best  of  Seller's
knowledge,  the  Seller  has  operated  the  Business  in  compliance  with  all
applicable      laws,      regulations,      permits,      and     orders.     

         3.5 Due Execution and Delivery; Valid and Binding Obligations;  Absence
of Breach. This Agreement has been duly executed and delivered by the Seller and
is a valid and binding obligation of the Seller,  enforceable in accordance with
its terms.  The  execution,  delivery and  performance of this Agreement and the
consummation of the transactions  contemplated  hereby have been duly authorized
by all  necessary  corporate  action of the Seller.  Neither the  execution  and
delivery of this Agreement not the consummation of the transactions contemplated
hereby  will:  (i)  conflict  with or violate any  provision  of the Articles of
Incorporation or Bylaws of the Seller, or of any law, ordinance or regulation or
any decree or order of any court of  administrative  or other  governmental body
which is either  applicable to, binding upon or enforceable  against the Seller;
(ii) to the best of Seller's knowledge, result in any breach of, cancellation of
or default under any mortgage, contract, agreement, indenture, ot will, trust or
other instrument which is either binding upon or enforceable  against the Seller
or the Assets; or (iii) violate any legally protected right of any individual or
entity  or give to any  individual  or  entity  a right  or  claim  against  the
Purchaser or the Assets.

         3.6  Intangible  Property.  Seller will deliver to  Purchaser  prior to
Closing all of the documents in Seller's  possession  evidencing  the intangible
property.  Seller owns all of the Intangible Property. As of the Closing, Seller
will have conveyed to Purchaser all of Seller's  right,  title,  and interest in
and to all of the  Intangible  Property  necessary  to conduct  the  Business of
Purchaser as presently  conducted by Seller free and clear of all liens,  except
(i)  claims of  ownership  by a  licensor  and any  restrictions  imposed by any
license agreement that, if enforced, would not interfere with the conduct of the
Business of Purchaser as presently  conducted by Seller.  Seller does not pay or
know of any  claim or  potential  claim of any  royalty  to  anyone  under or in
connection with the use of any Intangible property in the Business. 
<PAGE>
                                                       
         3.7  Contracts.  Seller has  delivered  to  Purchaser  true and correct
copies of each contact or agreement in the possession of Seller.  Seller has not
received  notice from any principal  that is has cancelled or terminated  any of
these agreements.  No principal has prepaid Seller for any commissions yet to be
earned. 

         3.8 Disclosure.  All statements  made herein are true and correct,  and
the information  provided and to be provided by Seller to Purchaser  relating to
this  Agreement  does not and will not contain any statement  which will, at the
time and in the light of the  circumstances  under which it is made, be false or
misleading with respect to any material fact, or omit to state any material fact
(which is known,  or in the exercise of  reasonable  diligence by Seller  should
have been known)  necessary in or order to make any statement  contained  herein
not  false  or  misleading  in  any  material  respect.   

                                   SECTION 4

                  REPRESENTATIONS AND WARRANTIES OF PURCHASER

         For the purpose of inducing  Seller to enter into this Agreement and to
consummate  the  transactions  contemplated  hereby,  Purchaser  represents  and
warrants  to Seller  that:  

         4.1 Organization,  Power and Authority of the Purchaser. Purchaser is a
corporation  duly organized and legally existing in good standing under the laws
of the State of California  and has full  corporate  power and authority and all
licenses and permits  necessary to own or lease its  properties  and to carry on
its      Business      as     it     is     now     being      conducted.      

         4.2 Litigation  Involving the Purchaser  There are not actions,  suits,
claims,  governmental  investigations or arbitration  proceedings  (collectively
"Litigation")  pending  or to the  best  of  Purchaser's  knowledge,  threatened
against or affecting the Purchaser and its ability to complete this transaction.
There are no outstanding  orders,  decrees or stipulations  issued by any local,
state, or federal judicial authority in any proceeding to which the Purchaser is
or was a party which affect r  Purchaser's  abilit y to perform its  obligations
under this Agreement. 

         4.3 Compliance  with Laws by the Purchaser.  To the best of Purchaser's
knowledge, the Purchaser is in compliance with all applicable laws, regulations,
permits, and orders. 

         4.4 Disclosure.  All statements  made herein are true and correct,  and
the  information  provided and to be provided by Purchaser to Seller relating to
this  Agreement  does not and will not contain any statement  which will, at the
time and in the light of the  circumstances  under which it is made, be false or
misleading with respect to any material fact, or omit to state any material face
(which is known, or in the exercise of reasonable  diligence by Purchaser should
have been known)  necessary in order to make any statement  contained herein not
false or misleading in any material respect.
<PAGE>

                                    SECTION 5

                        AGREEMENT BY SELLER TO INDEMNIFY

         5.1 Seller's Indemnity Obligation.

                  (a)  Seller  agrees  that  Seller  will   indemnify  and  hold
Purchaser harmless in respect of the aggregate of all expenses,  losses,  costs,
deficiencies,  liabilities  and  damages  (including  related  counsel  fees and
expenses)  incurred or suffered by Purchaser  (collectively  the  "Indemnifiable
Damages  of  Purchaser"),  (i)  as  a  result  of  breach  of  any  warranty  or
representation  made by Seller pursuant to this Agreement or (ii) resulting from
any default in the  performance  of any covenant or agreement made by the Seller
pursuant to this Agreement.  Seller shall not be required to indemnify Purchaser
until the  aggregate  amount  of  Indemnifiable  Damages  of  Purchaser  exceeds
$10,000.

                  (b) The  obligation  of  Seller  to  indemnify  Purchaser  for
Indemnifiable Damages of Purchaser shall be subject to the condition that Seller
shall   have   received   a  written   declaration   of   Purchaser   requesting
indemnification,  specifying the basis on which  indemnification  is sought, and
specifying   the  amount  of  the   Indemnifiable   Damages  of  Purchaser   (an
"Indemnification  Claim")  within six (6) months after the Closing Date.  Seller
shall not be liable  for  damages in excess of the actual  damages  suffered  by
Purchaser  as a result  of the act or  omission  for  which  indemnification  is
claimed,  net of any  insurance  proceeds  received  by Seller  or tax  benefits
realized  by Seller  as a result  of the  Indemnifiable  Damages  of  Purchaser.
Seller's maximum  liability for  indemnification  hereunder shall not exceed the
Purchase Price.

                  (c) Purchaser's sole remedy for a breach of any representation
or warranty  hereunder or Seller's default in the performance of any covenant or
agreement hereunder shall be indemnification.  For purposes of providing a means
by which the Seller's  obligation  to indemnify  the Purchaser may be satisfied,
the Seller agrees that  Purchaser  shall have the right to set off the amount of
Indemnifiable Damages of Purchaser against amounts owed to Seller.

                  (d) The  Seller  shall have a period of  forty-five  (45) days
from  the date it  receives  an  Indemnification  Claim  to give  notice  of its
intention to dispute each claim. If the Seller notifies the Purchaser in writing
within such 45-day period of its intention to dispute such Indemnification Claim
and if such  dispute is not resolved  within  thirty (30) days after the date of
such  notice  given by the  Seller,  then such  dispute  shall be resolved by an
arbitrator  mutually  satisfactory  to Purchaser  and Seller.  If Purchaser  and
Seller are unable to agree on a single arbitrator within thirty (30) days of the
date of the first written notice  suggesting an arbitrator,  then the arbitrator
shall be selected by the mutual  agreement of two  persons,  one  designated  by
Seller and one  designated  by  Purchaser.  Such  arbitrator  shall be appointed
within sixty (60) days after the expiration of the second above mentioned thirty
(30)  day  period.  The  arbitrator  shall  abide by the  rules of the  American
Arbitration  Association  and their  decision  shall be final and binding on all
parties. 
<PAGE>
                                                         
                                    SECTION 6
                                                         
                       AGREEMENT BY PURCHASER TO INDEMNIFY
                                                         
         6.1 Purchaser's Indemnity Obligation.

                  (a) Purchaser  agrees that  Purchaser  will indemnify and hold
Seller  harmless in respect of the  aggregate of all  expenses,  losses,  costs,
deficiencies,  liabilities  and  damages  (including  related  counsel  fees and
expenses)  incurred  or  suffered  by Seller  (collectively  the  "Indemnifiable
Damages of Seller") (i) as a result of breach of any warranty or  representation
made by Purchaser pursuant to this Agreement; or (ii) resulting from any default
in the  performance of any covenant or agreement made by the Purchaser  pursuant
to this Agreement. Purchaser shall not be required to indemnify Seller until the
aggregate amount of Indemnifiable Damages of Seller exceeds $10,000.

                  (b) The  obligation  of  Purchaser  to  indemnify  Seller  for
Indemnifiable Damages of Seller shall be subject to the condition that Purchaser
shall have received a written declaration of Seller requesting  indemnification,
specifying  the basis on which  indemnification  is sought,  and  specifying the
amount of the  Indemnifiable  Damages  of Seller  (an  "Indemnification  Claim")
within six (6) months after the Closing Date.  Purchaser shall not be liable for
damages in excess of the actual  damages  suffered  by Seller as a result of the
act or  omission  for which  indemnification  is claimed,  net of any  insurance
proceeds received by Purchaser or tax benefits realized by Purchaser as a result
of the Indemnifiable Damages of Seller.

                  (c) Seller's sole remedy for a breach of any representation or
warranty hereunder.

                  (d) The Purchaser  shall have a period of forty-five (45) days
from the date it  receives  and  Indemnification  Claim  to give  notice  of its
intention to dispute each claim. If the Purchaser notifies the Seller in writing
within such 45-day period of its intention to dispute such Indemnification Claim
and if such  dispute is not resolved  within  thirty (30) days after the date of
such notice given by the  Purchaser,  then such dispute  shall be resolved by an
arbitrator  mutually  satisfactory  to Purchaser  and Seller.  If Purchaser  and
Seller are unable to agree on a single arbitrator within thirty (30) days of the
date of the first written notice  suggesting an arbitrator,  then the arbitrator
shall be selected by the mutual  agreement of two  persons,  one  designated  by
Seller and one  designated  by  Purchaser.  Such  arbitrator  shall be appointed
within sixty (60) days after the expiration of the second above mentioned thirty
(30) day  period.  The  arbitrators  shall  abide by the  rules of the  American
Arbitration  Association  and their  decision  shall be final and finding on all
parties. 
<PAGE>
                                                         
                                    SECTION 7
                                                         
                               GENERAL PROVISIONS
                                                         
         7.1 Fees and expenses. Seller and Purchaser each shall pay the fees and
expenses  incurred by them in connection with the  transactions  contemplated by
this  Agreement.  

         7.2 Notices.  All notices,  request,  demands, and other communications
hereunder  shall be in  writing  and  shall be  delivered  (i) in  person  or by
courier,  (ii) mailed by first class  registered  or  certified  mail,  or (iii)
delivered by facsimile transmission, as follows:

           (a) If to Seller: 
               MGM  TechRep,  Inc. 
               P.O.  Box 8697 
               Rancho Santa Fe, CA 92067 

           (b) If to Purchaser: 
               Photomatrix, Inc.  
               1958 Kellogg Ave.  
               Carlsbad, CA 92008 

or to such other  address as the parties  hereto may designate in writing to the
other in  accordance  with this Section 7.2. Any party may change the address to
which  notices are to be sent to it by giving  written  notice of such change of
address to the other parties in the manner above provided for giving notice.  If
delivered  personally,  the  date on which a  notice,  request,  instruction  or
document is  delivered  shall be the date on which such  delivery is made and if
delivered by facsimile  transmission  or n mail as aforesaid,  the date on which
such notice,  request,  instruction or document is received shall be the date of
delivery.  

         7.3 Assignment;  Binding Effect. This Agreement shall not be assignable
by any of the parties  hereto  without the  written  consent of the other.  This
Agreement  shall be  binding  upon  the  parties  hereto  and  their  respective
successors,   assigns,  and  transferees.  

         7.4  Headings.  The  section,  subsection,  and other  headings in this
Agreement are inserted solely as a matter of convenience and for reference,  and
are  not a part of this  Agreement.

         7.5  Counterparts.  This  Agreement  may be  executed  in  two or  more
counterparts,  all of which shall be considered  one and the same  agreement and
shall become  effective when one  counterpart  has been signed by each party and
delivered  to the other  party  hereto.  

         7.6  Integration  of Agreement.  This  Agreement  supersedes  all prior
agreements,  oral and  written,  between the parties  hereto with respect to the
subject matter hereof. Neither this Agreement,  nor any provision hereof, may be
changed, waived, discharged,  supplemented, or terminated orally, but only by an
agreement in writing  signed by the party against which the  enforcement of such
change, waiver, discharge, or termination is sought. 
<PAGE>

         7.7 Partial Invalidity.  Whenever possible, each provision hereof shall
be interpreted in such manner as to be effective and valid under applicable law,
but in case any one or more of the provisions  contained  herein shall,  for any
reason, be held to be invalid,  illegal,  or unenforceable in any respect,  such
invalidity,   illegality,   or  unenforceability  shall  not  effect  any  other
provisions of this  Agreement,  and this Agreement shall be construed as if such
invalid,  illegal,  or  unenforceable  n provision or provisions  had never been
contained  herein  unless the  deletion of such  provision or  provisions  would
result in such a  material  change as to cause  completion  of the  transactions
contemplated hereby to be unreasonable. 

         7.8 Entire  Agreement.  This  Agreement  and the Exhibits and Schedules
attached hereto contain the entire  agreement of the parties hereto with respect
to the subject matter hereof.  Any reference  herein to this Agreement  shall be
deemed to include the Schedules and Exhibits attached hereto. 

         7.9 Governing  Law. The  validity,  interpretation,  construction,  and
performance  of this  Agreement  shall be controlled by and construed  under the
laws of the State of California.  In the event of any litigation  arising out of
any dispute in connection with this Agreement, the parties hereby consent to the
jurisdiction  of the  California  courts  and the  venue  of San  Diego  County,
California. 

         7.10  Arbitration.  Any dispute arising pursuant to this Agreement (but
not pursuant to the Security  Agreement)  other than with respect to breaches of
Sections 3.1 and 3.2 hereof shall be submitted for  arbitration by an arbitrator
mutually  satisfactory  to Purchaser  and Seller.  If  Purchaser  and Seller are
unable to agree on a single  arbitrator  within  thirty (30) days of the date of
the first written notice suggesting an arbitrator,  then the arbitrator shall be
selected by the mutual  agreement of two persons,  one  designated by Seller and
one  designated by Purchaser.  The  arbitrators  shall abide by the rules of the
American  Arbitration  Association and their decision shall be final and binding
on all parties. 



<PAGE>




         IN WITNESS  WHEREOF,  each party hereto has caused this Agreement to be
executed on its behalf by its duly  authorized  officers,  all as of the day and
year first above written.

                                           PURCHASER: Photomatrix, Inc.



                                           By: _______________________________
                                               Patrick W. Moore, CEO



                                           SELLER: MGM TechRep, Inc.



                                           By: ________________________________
                                               Lee Forsythe, President

<PAGE>


                                    Exhibits:

         1.1(a)     -                                              Equipment

         1.1(b)     -                                              Contracts

         1.2        -                                    Assumed Liabilities

         1.3        -                                         Purchase Price


<PAGE>



                                 Exhibit 1.1(a)

                       MGM TECHREP EQUIPMENT LIST (7/1/98)




              1-      Oak executive desk and wall unit combination

              1-      Executive chair

              1-      Oak credenza

              1-      Oak bookshelf

              1-      File cabinet (Oak)

              3-      Matching chairs

              1-      Pentium computer NCC 486DX2

              1-      HP Deskjet 692C

              1-      Compudyne monitor

              1-      Axion monitor

              1-      Casio DL-220 printing calculator

              1-      Upright 5 panel file cabinet

              2-      4 drawer file cabinets

              1-      Vision 21 computer

              1-      Trade show booth

              1-      5-ft. table




<PAGE>



                                 Exhibit 1.1(b)


                          Contracts With MGM Principals


                      I-PAC Manufacturing, Inc. (Contract Manufacturing)
                      I-PAC Express Assembly, Inc. (Contract Manufacturing)
                      Astron (Connectors)
                      Tyee Products (Resistors & Capacitors)
                      Machrone Manufacturing Corp. (EMI-Inductors)
                      Marina Pacific (Custom & Standard cables/fiber optics)
                      Tumbler (Power Cords)
                      Korean Circuits Company (PCB's)
                      Global Circuits (PCB's)
                      Tri-Star Engineered Products (PCB's)
                      Advanced Engineering & Molding (Plastic Injection Molding)
                      Techcraft (Custom Sheet Metal)
                      Autec Power Systems (Power Supplies) - Pending
                      Pacific Transformer (Transformers & Transducers)
                      Alliance Semi-conductor (memory) - Pending




<PAGE>



                       MGM COMMISSION RECEIPT CALCULATION
                       (copy of Check/Remittance attached)




Principal:_____________________      Date Received:_______________________



CHECK TOTAL     PRE-JULY 1, 1998 INVOICES    POST JULY 1,1998 INVOICES

$               $                            $
                       x  100%                       x    75
                $                            $








SUMMARY

         TOTAL RECEIVED:
         AMOUNT DUE O-MGM:

         PAID CHECK#__________________    DATE:___________________



<PAGE>


                                  Exhibit 1.2

                               ASSUMED LIABILITIES


No liabilities  incurred prior to July 1, 1998, are assumed by Purchaser  except
as specified here below:

              A.  Liabilities for personnel  employed by Seller on June 30, 1998
              that Purchaser  determined it would hire , effective July 1, 1998,
              to conduct the Business, to include:

                      1.       Unpaid but earned  wages in arrearage.
                      2.       Unpaid but earned leave benefits.
                      3.       Unpaid but earned sales commissions.
                      4.       Payroll tax liabilities associated with 1-3 
                               above.
                      5.       Employment agreement obligations for the post 
                               July 1, 1998 period.

              B. The personnel covered include :

                      1.       Lee Forsythe
                      2.       Jack Chalmers
                      3.       Dean Terry
                      4.       Monica Perez



<PAGE>


                                   Exhibit 1.3


                                 PURCHASE PRICE


The  price to be paid by  Purchaser  to  Seller  for the  Business  shall all be
allocated to Goodwill, and shall be comprised of the following:

         Purchaser  shall  compromise  and forgive any and all sales  commission
advances  paid out to Seller by IPAC  Manufacturing,  Inc.  and/or IPAC  Express
Assembly, Inc. that remain outstanding as of June 30, 1998.

         Purchaser  shall  compromise  and forgive any and all Accounts  Payable
owing by Seller to Purchaser, IPAC Manufacturing, Inc. or IPAC Express Assembly,
Inc. as of June 30, 1998.

         Purchaser shall pay over to Seller an amount equal to :

         100% of commission  payments  Purchaser  receives the  principals  that
Seller has transferred to Purchaser  [Exhibit 1.1 (b)] in this  Agreement,  that
were earned prior to July 1, 1998;

         75% of commissions earned from the principals  specified in Exhibit 1.1
(b) for the period of July 1, 1998, through June 30, 1999;

         50% of the commissions earned from the principals  specified in Exhibit
1.1 (b) for the period of July 1, 1999, through June 30, 2000;

         35% of the commissions earned from the principals  specified in Exhibit
1.1 (b) for the period of July 1, 2000, through June 30, 2001.

         Payments due to Seller  pursuant to A-C of this paragraph shall be paid
monthly,  prior to the 15th of the month, for amounts due through the end of the
prior month.

         Purchaser shall owe no amounts to Seller for principals that it secures
subsequent  to July 1, 1998,  that are not  included  on Exhibit 1.1 (b), or for
customers of those  principals  that were not a customer of one or more of those
principal accounts prior to July 1, 1998.