EXHIBIT 10.16


                            Assignment and Assumption

          Assignment  and  Assumption  dated as of  January 1, 2000 by and among
Allied Digital Technologies Corp., a Delaware corporation having an office at 15
Gilpin Avenue,  Hauppauge,  New York 11788 ("Assignor"),  Disc Graphics, Inc., a
Delaware corporation having an office at 10 Gilpin Avenue,  Hauppauge,  New York
11788 ("Assignee") and Lee Halpern and Larry Halpern, having an address of 16076
Villa Vizcaya, Delray Beach, Florida 33446 (collectively, "Landlord").

                                    RECITALS


          A. Landlord,  as landlord,  and Assignor,  as tenant, are parties to a
lease dated as of November 15, 1996 (the "Lease"), covering the building located
at 30 Gilpin Avenue,  Hauppauge,  New York 11788 and more particularly described
on Exhibit A attached hereto and made a part hereof (the "Premises").

          B.  Assignor  desires to assign to Assignee all of  Assignor's  right,
title and  interest in and to the Lease and is about to enter into a Sublease of
even date herewith between Assignee, as sublandlord, Assignor, as subtenant, for
the  premises  located  at 903  Motor  Parkway,  Hauppauge,  New York  (the "903
Sublease") as more particularly described in the Sublease.

          C. Assignee desires to assume all of Assignor's rights and obligations
in, to and under the Lease from and after the date hereof, and to enter into the
903 Sublease.

          Accordingly, Assignor, Assignee and Landlord agree as follows:

          1. Assignor hereby assigns to Assignee all of Assignor's right,  title
and interest in and to the Lease.  Assignor  hereby  represents  and warrants to
Assignee  that:  (i) the Lease is in full force and effect,  (ii)  Assignor  has
received  no  written  notice  of  default  (that  remains  uncured  beyond  any
applicable  notice and cure  period) from the  landlord  under the Lease,  (iii)
Assignor has not assigned,  encumbered or otherwise  transferred any interest of
Assignor as tenant under the Lease nor subleased any space demised by the Lease,
(iv) Assignor has performed  all of its material or monetary  obligations  under
the Lease,  and (v) no event has  occurred  or failed to occur  which,  with the
giving of notice or the passage of time,  or both,  would  constitute  a default
under the Lease by Assignor.

          2. Assignee  hereby assumes all of Assignor's  obligations  in, to and
under the Lease  arising  or  accruing  on or after  the date  hereof  and shall
defend,   indemnify  and  hold  harmless  Assignor  from  all  costs,   damages,
liabilities and expenses (including,  without limitation,  reasonable attorneys'
fees)  imposed upon or incurred by Assignor by reason of  Assignee's  failure to
perform  Assignor's  obligations under the Lease arising or accruing on or after
the date hereof.

          3. Assignor  shall defend,  indemnify and hold harmless  Assignee from
all costs,  damages,  liabilities and expenses  (including,  without limitation,
reasonable  attorneys'  fees)  imposed upon or incurred by Assignee by reason of
Assignor's failure to perform Assignor's  obligations under the Lease arising or
accruing prior to the date hereof.


<PAGE>
          4. Upon the full  execution  and  delivery of this  Agreement  and the
Sublease  to  Assignor,  Assignor  shall  (i) pay to  Landlord  a sum  equal  to
$171,118.00  (representing  the  amount  equal to  $250,000.00  less  $78,882.00
representing  additional  rent  previously paid by Assignor to Landlord for real
estate taxes (the "Prepaid Real Estate Taxes")) and (ii) release Landlord of its
obligation  to refund to Assignor  the amount  equal to such Prepaid Real Estate
Taxes.  As further  consideration  for Landlord's  execution of this  Agreement,
Assignor shall pay Landlord a sum equal to $150,000.00 on February 1, 2000 and a
sum equal to  $250,000.00  on August 1, 2000 (any such sum paid by  Assignor  to
Landlord being called the "Cancellation Fee").

          5. Articles 3.01 (a), (b) and (c) of the Lease are hereby  deleted and
the following is hereby inserted in their place:

                    "a. For the period  January 1, 2000  through  July 31, 2000,
          $198,070.00 annually, payable in monthly installments of $16,505.83.

                    b. For the  period  August 1, 2000  through  July 31,  2001,
          $206,032.00 annually, payable in monthly installments of $17,169.33.

                    c. For the  period  August 1, 2001  through  July 31,  2002,
          $364,150.00 annually, payable in monthly installments of $30,345.83.

                    d. For the  period  August 1, 2002  through  July 31,  2003,
          $372,430.00 annually, payable in monthly installments of $31,035.83

                    e. For the  period  August 1, 2003  through  July 31,  2004,
          $430,878.00 annually, payable in monthly installments of $35,906.50.

                    f. For the  period  August 1, 2004  through  July 31,  2005,
          $439,494.00 annually, payable in monthly installments of $36,624.50.

                    g. For the  period  August 1, 2005  through  July 31,  2006,
          $444,684.00 annually, payable in monthly installments of $37,057.00.

                    h. For the  period  August 1, 2006  through  July 31,  2007,
          $449,982.00 annually, payable in monthly installments of $37,498.50.

                    i. For the period  August 1, 2007 through  January 31, 2008,
          $227,220.00  for such  period,  payable  in  monthly  installments  of
          $37,870.00."

          6. Article 8.01 of the Lease is hereby amended by adding the following
sentence to the end of said Article:

                    "Notwithstanding  the  forgoing,  Lessee  may  also  use the
          premises for the manufacture of printed products and cosmetic and home
          care product sampling devices and containers."

          7.  Article  12.01 of the  Lease  is  hereby  amended  by  adding  the
following sub-article:


                    "i.  Notwithstanding  the foregoing,  Tenant may assign this
          Lease or sublet all or a portion of the  Premises  without  Landlord's
          prior consent (i) in connection with the sale of substantially  all of
          Tenant's  assets  located  in  the  Premises  or a  sale  of  Tenant's
          business,  (ii)  in  connection  with  a  merger,   reorganization  or
          consolidation  of Tenant,  or (iii) in  connection  with a  registered
          public offering of stock in Tenant."

          8.  Article  12.01(b)  of the Lease is hereby  amended  by adding  the
following language to the beginning of the sub-article:

                    "Except in connection with an assignment or subletting to an
          entity which is a publicly traded company,".

          9. For the  purposes  of Article  20.01 of the Lease,  the phrase "the
condition in which [the Premises] was originally delivered to Lessee" shall mean
the condition as it exits on the date hereof.

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          10. For the  purposes  of Article 30 of the Lease,  all notices to the
Assignee, as lessee, shall be addressed to:

                  Disc Graphics, Inc.
                  10 Gilpin Avenue
                  Hauppauge, New York 11788
                  Attention: Margaret Krumholz, CFO

with copy to:

                  Disc Graphics, Inc.
                  10 Gilpin Avenue
                  Hauppauge, New York 11788
                  Attention: Frank A. Bress, Esq.

          11. To the extent  applicable,  the fixed rent,  additional rent, real
estate taxes, and operating  expenses shall be apportioned as of midnight of the
day before the date hereof.

          12. For the purposes of Article  17.02 of the Lease,  the reference to
Section 18.01 of the Lease is amended to read "Section 17.01."

          13.  Prior to the date hereof,  Assignor  shall remove the vacuum pump
and all air compressors from the Premises

          14. a. Provided Assignee shall not be in default of its obligations as
sublessor under the 903 Sublease,  on or before the delivery date (collectively,
the  "Delivery  Dates" (or such other date as may be agreed to by  Assignor  and
Assignee in writing,  that date being deemed the respective  Delivery Date)) set
forth on the table below, Assignor shall deliver to Assignee the respective area
(collectively,  the  "Areas",  as more  particularly  described on Exhibit A) in
vacant and broom clean condition.



Delivery Date                            Area(s)
-------------                            -------

January 1, 2000                           1 & 2

February 16, 2000                          3B

March 1, 2000                              3A

                    b. In the event  Assignor is unable to deliver any such Area
          on its respective Delivery Date (provided, however, if the delivery of
          any such Area is delayed past its  respective  Delivery Date by reason
          of acts of God, labor disputes,  civil  commotion,  war, fire or other
          casualty,  inability to procure materials,  governmental  regulations,
          statutes, ordinances,  restrictions or decrees, or other causes beyond
          the control of Assignor or  Assignee  (financial  inability  excepted)
          (collectively,  "Force Majeure"),  such respective Delivery Date shall
          be extended for a period  equivalent  to the period of such delay from
          and after said  Delivery  Date),  Assignor  shall pay to  Assignee  an
          amount equal to the sum of (x)  $10,000.00  plus (y) $1,000.00 per day
          for each day delay thereafter, as liquidated damages for such failure.
          If the  delivery  of any such  Area is  delayed  past  the  respective
          Delivery Date due to (i) any act or omission of Assignee or any of its
          employees, agents or contractors or (ii) Assignee's failing to deliver
          to Assignor  any such space  pursuant to the 903  Sublease,  then such
          Area shall be deemed  delivered on the Delivery Date and no liquidated
          damages shall be due to Assignee.

                    c. In the event Assignor shall fail to deliver any such Area
          in broom clean  condition  (other than due to Force Majeure or any act
          or  omission  of  Assignee  or  any  of  its   employees,   agents  or
          contractors),  Assignor shall pay Assignee an amount equal to the cost
          of making the Area broom clean within 30 days after the date  Assignee
          delivers to Assignor paid invoices  evidencing the payment by Assignee
          for such  work  (which  invoices  must be  delivered  by  Assignee  to
          Assignor on or before 15 days following the date of such work).

          15.  Assignor  shall   indemnify,   defend  (by  counsel  selected  by
Assignor),  and hold harmless  Assignee from and against any and all third party
claims pursuant to any environmental laws arising from or related to the release
of any hazardous or toxic material by Assignor on the Premises  during the Lease
term prior to the date hereof.  The  preceding  sentence  shall not diminish the
rights or obligations of either party under the common law or any  environmental
law.
<PAGE>
          16.  Landlord  hereby (a)  consents  to the  execution,  delivery  and
performance of this  Assignment and the Sublease and (b) releases  Assignor from
and against any and all claims,  obligations  and  liabilities  of every kind or
nature whatsoever arising under or relating to the Lease.


          IN WITNESS  WHEREOF,  this  Assignment  has been duly  executed by the
parties hereto on the day and year first above written.

                                           ASSIGNOR

                                           Allied Digital Technologies Corp.


                                           By: /s/ Douglas G. McDonald
                                           ---------------------------
                                           Name: Douglas G. McDonald
                                           Title: Executive V.P. and CFO


                                           ASSIGNEE

                                           Disc Graphics, Inc.


                                           By: /s/ Margaret Krumholz
                                           -------------------------
                                           Name:  Margaret Krumholz
                                           Title: Sr. V.P. and CFO



                                           LANDLORD (except as to the
                                             provisions with respect to
                                             the 903 Sublease)


                                           /s/ Lee Halpern
                                           ---------------
                                              Lee Halpern



                                           /s/ Larry Halpern
                                           -----------------
                                            Larry Halpern