EXHIBIT 10.1
                                  ------------

October 25, 1996

Junaid Sheikh
Accom
1490 O'Brien Dr.
Menlo Park, CA 94025

RE: Lease Extension

1490 O'Brien Drive,
(Building 10),
Menlo Park, CA

Dear Junaid:

This  letter,  when  executed,  will serve as a formal  Agreement  to extend and
modify that certain  lease dated January 28, 1992,  for the Premises  located at
1490  O'Brien  Drive,  Building  10, of Menlo  Business  Park,  California  (the
"Lease"). Following are the conditions of the Agreement:

1. The  commencement  date of this extension  shall be February 27, 1997 and the
expiration shall be February 26, 2,000.

2. The term of the Lease  extension  shall be for a period  of  thirty  six (36)
months or three (3) years.

3. Paragraph 5 is hereby amended with the following monthly rent schedule

Year 1 $37,680/month
Year 2 Year 1 plus CPI annual  increase  (min 3%, max 7%) 
Year 3 Year 2 plus CPI annual increase (min 3%, max 7%)

4. Paragraph 7, Security Deposit, is hereby amended to $37,680.00.  Tenant shall
deposit with Landlord an additional  $6,330.24 to increase the current  security
deposit to this new amount.

5. Tenant warrants that there are no outside brokers except Tarlton  Properties,
Inc. acting as exclusive leasing agent for Menlo Business Park.

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Lease Extension
Accom, Inc. Page 2

6. Paragraph 17(c) is hereby amended as follows:

Landlord shall, at Tenants  expense,  obtain at competitive  rates,  and keep in
full force and effect,  a service  contract with a licensed HVAC  contractor for
the  maintenance  of the HVAC  systems  in the  Building  which  shall  have the
shortest notice of termination period available.

7.  Landlord  hereby  agrees  to credit  Tenant  with an  Improvement  Allowance
(guaranteed  maximum  price) for 30,144 SF in the amount of Thirty  Thousand One
Hundred  and  Forty  Four  Dollars  ($30,144),  to be used  for the  design  and
construction of Tenant Improvements that is approved by both Landlord and Tenant
and executed by Landlord's agent and Construction  Manager,  Tarlton Properties,
Inc.  Said  construction  to be performed as an open book,  audited,  negotiated
fixed fee guaranteed  maximum price contract,  with Jack & Cohen Builders as the
general contractor. As used herein, the term "Costs" shall mean and refer to all
costs  expended  by  Landlord   relative  to  the  construction  of  the  Tenant
Improvements  including,  but  not  limited  to,  10%  contingency;   equipment,
materials and labor; contractor's field overhead and fee; architectural,  design
and engineering fees plus working drawings ( if any);  governmental agency fees;
testing and inspection costs; sales and use taxes (but not real property taxes);
permits;  plan check fees;  bonds;  and all other costs directly  related to the
construction of the Tenant Improvements,  plus a design/construction  management
fee in the  amount of 5% of the Costs of the Tenant  Improvements  to be paid to
Tarlton Properties, Inc.

In the event that the Costs of the  Tenant  Improvements  exceed the  Allowances
defined above, due to Tenant requested changes, Tenant shall pay to Landlord all
actual Costs that exceed the Allowances in cash at the end of construction.

8. All other terms and  conditions  of said Lease shall remain in full force and
effect.

Please  acknowledge your acceptance of this Agreement by signing and returning a
copy thereof.

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Lease Extension
Accom, Inc.
Page 3

We look forward to having Accom Inc. remain in the Park in the upcoming years.

Sincerely,
TARLTON PROPERTIES INC.
Exclusive Agents for Menlo Business Park Joint Venture

/s/ Lorrin C. Tarlton, Jr.

PATRICIAN ASSOCIATES, INC.,
a California corporation

By: /s/ Ronald B. Franklin
Vice President

By /s/ Kurt D. Schaeffer
Vice President

MENLO BUSINESS PARK,
a California general partnership

By: /s/ John O. Lewis, as general partner

By: Oltmans Investment Company, as general partner

By: /s/ J C . Oltmans II

 By: /s/ Basil C. Johnson

By: Lorrin C. Tarlton, Jr., and Marilyn L. Tarlton, Trustees, As general partner
By: /s/ Lorrin C. Tarlton, Jr., Trustee

By: /s/ Marilyn Tarlton, Trustee

READ AND AGREED
ACCOM, INC.
a California corporation

By: /s/ Junaid Sheikh
Its:  Chairman and CEO