ALTRON MANUFACTURING AGREEMENT

This agreement is effective as of 8-28-96, between Altron, Inc. (The Seller)
having its principle place of business at 6700 Industry Avenue N.W., Anoka, MN
and RSI Systems, Inc., One Corporate Plaza 7400 Metro Blvd. Suite 475, Edina, MN
(The Buyer).

I. SCOPE OF AGREEMENT

Seller shall sell and Buyer may order and purchase under the terms and
conditions of this agreement for the products listed below. For purposes of this
agreement, "product" shall mean and be limited to those parts or components that
are manufactured for Buyer by Seller as listed below and any mutually agreed
modifications to those previously defined parts or components. This agreement
prevails over any additional, conflicting or inconsistent terms and conditions
appearing on any standard quotation, purchase order, acknowledgment, invoice or
other form used by the parties in connection with this agreement.

   Part Number                                  Part Description
Complete Assembly                           ERIS Video Conferencing Unit


II. TERMS OF PURCHASE

The Buyer's purchase orders and any other specially negotiated terms and
conditions set forth on the purchase order shall govern each purchase
transaction.

A.  Buyer will place purchase orders consistent in prices and delivery per the
    quotation referencing the parts or components in consideration within the
    confines if this agreement. Seller will acknowledge all purchase orders
    within 15 days of Seller's receipt of Buyer's order. Sellers acknowledgment
    will confirm all prices, terms and specify a delivery date.

B.  Buyer may at any time request that delivery of a product be rescheduled to a
    date earlier than the originally scheduled date. Seller shall use all
    reasonable efforts to accommodate such requests without charge to buyer
    unless Seller incurs additional costs directly related to the rescheduling
    activity.

C.  If possible, Buyer will provide Seller with a forecast of the quantities of
    products that the Buyer anticipates purchasing during the term of the
    agreement. This forecast shall be non binding and utilized for planning
    purposes only. Seller will not be obligated to purchase raw material based
    on this forecast unless excess quantities are purchased due to minimum
    purchase quantities or packaging designs that require that specific
    quantities must be purchased.

D.  Seller will purchase for incorporation into the product components that are
    custom to Buyer's technical applications. Seller and Buyer will agree to
    meet to discuss custom components lead times and liability. Any agreements
    arising from these discussions shall be documented in writing and signed by
    both parties. Unless otherwise specifically agreed upon, the terms regarding
    the purchase of custom components contained herein shall apply. Buyer will
    also assume fiscal responsibility for all remaining material resulting from
    design changes, part obsolesce and/or order cancellation.

III.     PRICING

A.  Seller warrants that all prices are comparable to those prices offered to
    Seller's other customers for similar products in like quantities. The prices
    applicable to purchase orders placed under this agreement are specified in
    each quotation referencing the products described in section "T" of this
    agreement.

B.  Pricing can be reviewed during the times of a revision, significant quantity
    change and/or on a scheduled quarterly basis. At the time of one of these
    events the Seller and Buyer will discuss any changes in materials or
    processes that may warrant price adjustments. If a price adjustment is
    mutually agreed upon, the Seller will provide the Buyer with a new quotation
    including the new price with an effective date being established and agreed
    upon.

IV. PACKAGING

A.  Seller shall package all products in accordance with Buyer packaging
    specifications.

B.  Deliveries will be made as specified below:
              FOB:   Altron dock

V.  DELIVERY TITLE AND RISK OF LOSS

A.  The Seller will make shipments by UPS or Federal Express with delivery
    charges FOB Seller's dock.

B.  All of the Buyers materials are insured while in transit in our vehicle and
    while in our facility.

C.  Seller will notify the Buyer as soon as the Seller is aware that the
    scheduled delivery date cannot be met.

VI. QUALITY ASSURANCE AND ACCEPTANCE

A.  Supplier will strive to achieve a 95% or better first pass yield through
    Buyer's production processes and ensure the products are not defective in
    material and conform to Buyer's specifications.

B.  Seller will manufacture all material to a workmanship standard defined and
    agreed upon by the Buyer and Seller. The workmanship standard for this
    material is: ANSI/IPC.

C.  Any product which the Buyer reasonably determines does not conform to, or is
    defective may be rejected back to the Seller for repair or replacement
    provided the Buyer notifies the Seller of the rejection and the reasons for
    rejection.

D.  Payment of invoice does not constitute acceptance of a product.

E.  Seller shall be responsible for all workmanship problems caused be the
    Seller only if Seller is notified prior to any corrective action taken by
    the Buyer.

F.  On a monthly basis, Seller and Buyer shall meet to review Mutual performance
    metrics, including but not limited to product assembly quality, on time
    delivery and component quality.

VII.     ENGINEERING CHANGES

A.  Buyer may make and Seller shall incorporate engineering changes or other
    modifications to products. Any such changes affecting costs and production
    schedules shall be negotiated by Buyer and Seller prior to implementation.

B.  Any excess materials generated as a result of engineering change orders
    will be the liability of Buyer.

VIII.    WARRANTY

The Seller represents and warrants that on the date of shipment to the Buyer, it
will convey good title and the assemblies will be free from defects in material
and workmanship for fifteen (15) months from packing slip date, or twelve (12)
months from date Buyer ships to customers, whichever comes first. This warranty
is void if assemblies have been subject to abuse, accident, alteration, neglect,
unauthorized repair, or any act not considered proper operation.

Additionally, the Seller will pass through any third party supplier warranty of
a product part, material or component that is used in the turnkey manufacture of
the Buyer's product.

IX.   TOOLING AND TEST EQUIPMENT

A.  Seller expressly agrees that all tools identified below are the property and
    assets of buyer. Seller shall not assign, lease, license, pledge, loan
    mortgage or otherwise part with possession or the right to posses tools.
    Seller shall allow no claims, encumbrances or liens with respect to tools
    and shall not state or imply to any third party that Seller is the owner of
    tools.

B.  Seller shall, to Buyer's reasonable satisfaction, provide storage, security
    and maintenance services and facilities necessary to keep all tools secured
    and in good working order.

C.  Seller shall use tools for the sole purpose of producing products to be sold
    by Seller to Buyer. Seller agrees not to use tools for any other purpose.

D.  Buyer may at any time inspect tools and Seller's facilities to assure Buyer
    of Seller's compliance with these provisions.

X.  PROPERTY RIGHTS

Product designs and specifications are the sole and exclusive property of Buyer.
Except as specifically set forth in this agreement Seller has no rights with
respect to product designs and specifications. This clause shall survive any
termination or expiration of this agreement.

XI. TAXES

Unless Buyer furnishes a valid exemption certificate, Buyer will bear all sales
and use properly imposed by federal, state, municipal or other local authorities
in respect to purchases under this agreement.

XII.  EXCLUSIVITY

Seller represents and warrants that it shall not provide the products covered by
this agreement to any third party. This clause shall survive any termination or
expiration of this agreement.

XIII.  CONFIDENTIAL INFORMATION

During the performance of its obligations under this agreement, Seller and its
employees may have access to information which is considered confidential or
trade secret by Buyer. Details of confidentiality will be covered by the Buyer's
Confidential Information Agreement.

Seller shall not disclose to any third party any pricing or product information
relating to this agreement. Seller shall not publicize or otherwise make known
to any third party any information relating to this agreement without prior
written consent of Buyer.

XX.    TERMINATION

A.  Either party may terminate this agreement upon 30 days written notice if the
    other party fails to comply with any material term of this agreement. The
    party not in compliance will have 30 days to cure any failure and avoid
    termination. The party not in compliance will provide written proof of
    corrective action. Upon termination, the obligations of the parties will
    cease except for Seller's obligation to deliver products ordered by Buyer
    prior to the termination and still required by Buyer and Buyer' s obligation
    to pay for all products accepted under this agreement.

B.  Buyer may terminate this agreement upon 30 days written notice. Upon such
    termination, Buyer shall remain liable for Seller's burdened material costs
    for products ordered, work in progress, excess material resulting from
    packaging constraints and or engineering changes. Seller shall provide Buyer
    with documentation of and an invoice for such costs. Buyer shall pay such
    invoice within 30 days of receipt. Payment of such invoice shall be Buyer's
    sole liability upon termination of this agreement.

Upon termination of this agreement, the obligations of the parties shall cease
except for:

    i.  Seller's obligation to deliver products ordered by Buyer prior to the
        termination, and

    ii. Buyer's obligation to pay for all products accepted under the agreement.

XXI.   COMPLIANCE WITH LAWS AND REGULATIONS

Seller will comply with all applicable federal, state and local laws, rules and
regulations.

XXII.  GENERAL PROVISIONS

A.  This document and its exhibits contain the entire agreement between the
    parties relating to the subject matter contained herein. All prior or
    contemporaneous agreement, written or oral, between the parties regarding
    the products and services are superseded by this agreement. This agreement
    may not be modified except by written document signed by an authorized
    representative of each party.

B.  Product pricing, lead-times, and other unique and product specific related
    criteria will be governed by a purchase order referencing specific
    assemblies or assembly characteristics.

C.  Neither part shall be liable for delays or defaults due to fire, windstorm,
    riot, act of God, act of the public enemy, or, except for defaults or delay
    by subcontractors other similar unforeseeable cause beyond the reasonable
    control and without the fault of negligence of the party incurring such
    delay. Seller will notify Buyer in writing of the existence of such cause
    within five days after the commencement of the delay or default.


Seller: Altron Inc.                                  Buyer: RSI Inc.          
By: /s/ Alan C. Phillips                             By: /s/ Donald C. Lies
Name: Alan C. Phillips                               Name: Donald C. Lies      
Title: President                                     Title: President           
Date: 8-29-96                                        Date: 9-10-96