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                                                                    EXHIBIT 10.3
                                                                    ------------
                                                                                
                              SECOND AMENDMENT TO
                          LOAN AND SECURITY AGREEMENT

     THIS SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT this "Second
Amendment") is dated as of May 31, 1996 and is entered into between SCIENTIFIC
TECHNOLOGIES INCORPORATED, an Oregon corporation doing business in California as
Oregon Scientific Technologies (the "Borrower"), and BANK OF THE WEST, a
California banking corporation (the "Bank").

                                   RECITALS:
                                   ---------
                                        
     A.   Borrower and Bank have entered into that certain Loan and Security
Agreement dated November 29, 1994 as amended by that certain First Amendment to
the Loan and Security Agreement dated as of May 31, 1995.(collectively, the
"Loan Agreement") and that certain Equipment Purchase Line Note dated December
6, 1995 (the "Equipment Purchase Line Note");

     B.   Borrower and Bank intend to further amend the Loan Agreement as
provided by this Second Amendment.

                                   AMENDMENT:
                                   ----------
                                        
     NOW, THEREFORE, Borrower and Bank hereby agree as follows:

     1.   This Second Amendment shall modify and, to the extent inconsistent
with, amend the Loan Agreement and/or the Equipment Purchase line Note.  Any
capitalized term not specifically defined herein shall have the meaning ascribed
to it in the Loan Agreement.

     2.   The last sentence of Section 3.1(a) of the Loan Agreement is hereby
deleted in its entirety and is replaced with the following:

     For the purpose of this Agreement, "Draw Period" shall mean the period
     between the date of this Loan and Security Agreement and the earlier of:
     (i) May 31, 1997 or (ii) the date on which the aggregate of all advances
     made pursuant to this Section 3.1 equals Five Hundred Thousand and 00/100
     Dollars ($500,000.00).

     3.   The last sentence of Section 3.3(c) of the Loan Agreement is hereby
deleted in its entirety and is replaced with the following:

     For the purpose of this Agreement, the "Term Maturity Date" shall mean May
31, 1997.

     4.   The second sentence of the first paragraph of Section 4.1 of the Loan
Agreement is hereby deleted in its entirety and is replaced with the following:

     Borrower's right to obtain advances under Section 2.1 and to enter into
     foreign exchange contracts under the FX Facility provided by Section 14.1
     shall remain in full force and effect until May 31, 1997, and shall
     continue on a month-to-month basis thereafter until terminated by either
     party on thirty (30) days prior written notice to the other.

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     5.   The last sentence of the fifth paragraph of the Equipment Purchase
Line Note is hereby deleted in its entirety and is replaced with the following:

     For the purpose of this Note, the "Term Maturity Date" shall mean May 31,
1997.

     6.   Concurrently with the execution of this Second Amendment, Borrower
shall pay to Bank a fee in an annual amount equal to Six Thousand Five Hundred
Dollars ($6,500.00), which fee shall represent an unconditional and
nonrefundable payment to Bank in consideration of Bank's agreement to enter into
this Second Amendment.

     7.   Bank's duties to extend and renew the Obligations and to make advances
in accordance with this Second Amendment shall be subject to (i) there being no
outstanding and uncured defaults under the Loan Agreement, the Equipment
Purchase Line or any other obligation owing by borrower to Bank and (ii) the
satisfaction of each of the conditions precedent set forth in Article 6 of the
Loan Agreement (including, without limitation, the provisions of Section 6.7
respecting the delivery of a landlord waiver in the form and content of attached
Exhibit "A" and the provisions of Section 6.9 respecting the deliveries of
insurance policies, binders and/or certificates), each of which is incorporated
herein by this reference.

     8.   Except as amended by this Second Amendment, all of the terms and
conditions of the Loan Agreement (and each and every document or instrument
executed and delivered in connection therewith) is and shall remain in full
force and effect.

     9.   Except as amended by this Second Amendment, Borrower hereby ratifies,
reaffirms, and remakes as of the date hereof each and every representation and
warranty contained in the Loan Agreement, the Equipment Purchase Line Note, or
in any document executed and delivered in connection therewith.

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     IN WITNESS WHEREOF, Borrower has executed and delivered this Second
Amendment to Bank on the date first above written at Walnut Creek, California.

                         "BORROWER"

                         SCIENTIFIC TECHNOLOGIES INCORPORATED,
                         an Oregon corporation doing business in California as
                         Oregon Scientific Technologies

                         By: /s/ Joseph J. Lazzara
                             ---------------------

                         Its: President & CEO
                              ---------------

     IN WITNESS WHEREOF, Bank hereby accepts this Second Amendment to be
effective as of the date first above written in Walnut Creek, California.

                         "BANK"

                         BANK OF THE WEST,
                         a California banking corporation

                         By: /s/ R. W. Hansen
                             ----------------

                         Its: Vice President
                              --------------

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