EXHIBIT 10.2

                                 PROMISSORY NOTE
                                 ---------------


              Loan            Loan
 Principal    Date   Maturity  No.  Call  Collateral  Account  Officer  Initials
$5,500,000   2-3-97                  19      365    4503617482  47440


References  in the shaded  area are for  Lender's  use only and do not limit the
applicability of this document to any particular loan or item.

Borrower:  Phoenix Gold         Lender:  UNITED STATES NATIONAL BANK OF OREGON
           International, Inc.           CORPORATE BANKING DIVISION
           9300 N. Decatur               PL-7 OREGON COMMERCIAL LOAN SERVICING
           Portland, OR  97203           555 S.W. OAK
                                         PORTLAND, OR  97204

================================================================================

Principal Amount: $5,500,000.00
Initial Rate:     10.250%
Date of Note:     February 3, 1997

PROMISE TO PAY. PHOENIX GOLD INTERNATIONAL, INC. ("BORROWER") PROMISES TO PAY TO
UNITED STATES NATIONAL BANK OF OREGON  ("LENDER"),  OR ORDER, IN LAWFUL MONEY OF
THE UNITED STATES OF AMERICA,  ON DEMAND,  THE PRINCIPAL  AMOUNT OF FIVE MILLION
FIVE  HUNDRED  THOUSAND & 00/100  DOLLARS  ($5,500,000.00)  OR SO MUCH AS MAY BE
OUTSTANDING,  TOGETHER WITH INTEREST ON THE UNPAID OUTSTANDING PRINCIPAL BALANCE
OF EACH  ADVANCE.  INTEREST  SHALL BE  CALCULATED  FROM THE DATE OF EACH ADVANCE
UNTIL REPAYMENT OF EACH ADVANCE.

PAYMENT.  BORROWER  WILL PAY THIS LOAN  IMMEDIATELY  UPON  LENDER'S  DEMAND.  IN
ADDITION,  BORROWER  WILL PAY REGULAR  MONTHLY  PAYMENTS  OF ALL ACCRUED  UNPAID
INTEREST  DUE AS OF EACH  PAYMENT  DATE,  BEGINNING  MARCH  1,  1997,  WITH  ALL
SUBSEQUENT INTEREST PAYMENTS TO BE DUE ON THE SAME DAY OF EACH MONTH AFTER THAT.
Interest on this Note is computed on a 365/360 simple interest  basis;  that is,
by  applying  the  ratio of the  annual  interest  rate over a year of 360 days,
multiplied by the outstanding principal balance, multiplied by the actual number
of days the  principal  balance  is  outstanding.  Borrower  will pay  Lender at
Lender's  address  shown above or at such other place as Lender may designate in
writing. Unless otherwise agreed or required by applicable law, payments will be
applied first to accrued unpaid interest,  then to principal,  and any remaining
amount to any unpaid collection costs and late charges.

<PAGE>

VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from
time to time based on changes in an index which is the Lender's Prime Rate. This
is the rate of interest which Lender from time to time  establishes as its Prime
Rate and is not, for example,  the lowest rate of interest which Lender collects
from any borrower or class of borrowers (the  "Index").  The interest rate shall
be adjusted  without  notice  effective on the day Lender's  prime rate changes.
Lender  will tell  Borrower  the  current  Index rate upon  Borrower's  request.
Borrower  understands  that  Lender may make loans based on other rates as well.
The  interest  rate  change  will not occur more often than each Day.  THE INDEX
CURRENTLY  IS 8.250% PER ANNUM.  THE  INTEREST  RATE TO BE APPLIED TO THE UNPAID
PRINCIPAL BALANCE OF THIS NOTE WILL BE AT A RATE OF 2.000 PERCENTAGE POINTS OVER
THE INDEX, RESULTING IN AN INITIAL RATE OF 10.250% PER ANNUM.

PREPAYMENT.  Except for the foregoing, Borrower may pay without penalty all or a
portion of the amount owed  earlier  than it is due.  Early  payments  will not,
unless agreed to by Lender in writing, relieve Borrower of Borrower's obligation
to  continue to make  payments of accrued  unpaid  interest.  Rather,  they will
reduce the principal balance due.

DEFAULT.  Borrower  will be in  default  if any of the  following  happens:  (a)
Borrower  fails to make any payment when due.  (b)  Borrower  breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform when
due any other term, obligation, covenant, or condition contained in this Note or
any agreement  related to this Note, or in any other  agreement or loan Borrower
has with Lender. (c) Any representation or statement made or furnished to Lender
by Borrower  or on  borrower's  behalf is false or  misleading  in any  material
respect  either  now or at the time  made or  furnished.  (d)  Borrower  becomes
insolvent, a receiver is appointed for any part of Borrower's property, Borrower
makes an assignment for the benefit of creditors, or any proceeding is commenced
either by Borrower or against  Borrower under any bankruptcy or insolvency laws.
(e) Any creditor tries to take any of Borrower's  property on or in which Lender
has a  lien  or  security  interest.  This  includes  a  garnishment  of  any of
Borrower's  accounts  with Lender.  (f) Any  guarantor  dies or any of the other
events described in this default section occurs with respect to any guarantor of
this  Note.  (g) A  material  adverse  change  occurs  in  Borrower's  financial
condition,  or Lender  believes  the prospect of payment or  performance  of the
indebtedness is impaired. lb) Lender in good faith deems itself insecure.

<PAGE>

LENDER'S  RIGHTS.  Upon default,  Lender may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest  immediately  due,  without
notice, and then Borrower will pay that amount. Upon default,  including failure
to pay upon final maturity,  Lender, at its option, may also, if permitted under
applicable  law,  increase  the  variable  interest  rate on this  Note to 7.000
percentage  points over the Index. The interest rate will not exceed the maximum
rate  permitted by applicable  law.  Lender may hire or pay someone else to help
collect this Note if Borrower  does not pay.  Borrower also will pay Lender that
amount.  This includes,  subject to any limits under  applicable  law,  Lender's
attorneys'  fees and Lender's legal expenses  whether or not there is a lawsuit,
including  attorneys'  fees  and  legal  expenses  for  bankruptcy   proceedings
(including  efforts  to modify  or vacate  any  automatic  stay or  injunction),
appeals,  and  any  anticipated   post-judgment   collection  services.  If  not
prohibited  by  applicable  law,  Borrower  also  will pay any court  costs,  in
addition to all other sums  provided  by law.  THIS NOTE HAS BEEN  DELIVERED  TO
LENDER AND  ACCEPTED  BY LENDER IN THE STATE OF  OREGON.  IF THERE IS A LAWSUIT,
BORROWER  AGREES  UPON  LENDER'S  REQUEST TO SUBMIT TO THE  JURISDICTION  OF THE
COURTS OF MULTNOMAH  COUNTY,  THE STATE OF OREGON.  SUBJECT TO THE PROVISIONS ON
ARBITRATION, THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF OREGON.

RIGHT OF SETOFF.  Borrower  grants to Lender a contractual  possessory  security
interest in, and hereby assigns,  conveys,  delivers,  pledges, and transfers to
Lender all Borrower's right,  title and interest in and to, Borrower's  accounts
with  Lender  (whether  checking,  savings,  or some other  account),  including
without  limitation all accounts held jointly with someone else and all accounts
Borrower may open in the future,  excluding  however all IRA and Keogh accounts,
and all trust  accounts  for which the  grant of a  security  interest  would be
prohibited  by law.  Borrower  authorizes  Lender,  to the extent  permitted  by
applicable  law, to charge or setoff all sums owing on this Note against any and
all such accounts.

LINE OF CREDIT.  This Note evidences a revolving line of credit.  Advances under
this Note, as well as directions for payment from  Borrower's  accounts,  may be
requested  orally or in writing by Borrower or by an authorized  person.  Lender
may,  but need not,  require  that ail oral  requests be  confirmed  in writing.
Borrower  agrees to be liable for all sums either:  (a)  advanced in  accordance
with  the  instructions  of an  authorized  person  or  (b)  credited  to any of
Borrower's accounts with Lender,  regardless of the fact that persons other than
those  authorized  to borrow have  authority to draw against the  accounts.  The
unpaid  principal  balance  owing on this Note at any time may be  evidenced  by
endorsements  on this Note or by  Lender's  internal  records,  including  daily
computer print-outs.  Lender will have no obligation to advance funds under this
Note if: (a)  Borrower or any  guarantor  is in default  under the terms of this
Note or any agreement that Borrower or any guarantor has with Lender,  including
any agreement made in connection  with the signing of this Note; (b) Borrower or
any guarantor ceases doing business or is insolvent; (c) any guarantor seeks, or
otherwise attempts to limit, modify or revoke such guarantor's guarantee of this
Note or any other loan with  Lender;  (d) Borrower  has applied  funds  provided
pursuant to this Note for purposes other than those authorized by Lender; or (e)
Lender  in good  faith  deems  itself  insecure  under  this  Note or any  other
agreement between Lender and Borrower.

<PAGE>

ARBITRATION.   LENDER  AND  BORROWER   AGREE  THAT  ALL  DISPUTES,   CLAIMS  AND
CONTROVERSIES  BETWEEN  THEM,  WHETHER  INDIVIDUAL,  JOINT,  OR CLASS IN NATURE,
ARISING FROM THIS NOTE OR OTHERWISE,  INCLUDING WITHOUT LIMITATION  CONTRACT AND
TORT  DISPUTES,  SHALL BE  ARBITRATED  PURSUANT  TO THE  RULES  OF THE  AMERICAN
ARBITRATION ASSOCIATION, UPON REQUEST OF EITHER PARTY. No act to take or dispose
of any  collateral  securing  this  Note  shall  constitute  a  waiver  of  this
arbitration  agreement or be  prohibited  by this  arbitration  agreement.  This
includes,  without  limitation,  obtaining  injunctive  relief  or  a  temporary
restraining  order;  foreclosing  by notice  and sale under any deed of trust or
mortgage;  obtaining  a writ of  attachment  or  imposition  of a  receiver;  or
exercising  any  rights  relating  to  personal  property,  including  taking or
disposing of such property with or without  judicial process pursuant to Article
9 of the  Uniform  Commercial  Code.  Any  disputes,  claims,  or  controversies
concerning  the  lawfulness  or  reasonableness  of any act,  or exercise of any
right,  concerning  any  collateral  securing this Note,  including any claim to
rescind,  reform,  or otherwise modify any agreement  relating to the collateral
securing  this  Note,  shall  also  be  arbitrated,  provided  however  that  no
arbitrator  shall have the right or the power to enjoin or  restrain  any act of
any party.  Judgment upon any award rendered by any arbitrator may be entered in
any court  having  jurisdiction.  Nothing in this Note shall  preclude any party
from  seeking  equitable  relief  from a court of  competent  jurisdiction.  The
statute of limitations,  estoppel,  waiver,  laches, and similar doctrines which
would  otherwise  be  applicable  in an  action  brought  by a  party  shall  be
applicable in any arbitration proceeding, and the commencement of an arbitration
proceeding shall be deemed the commencement of an action for these purposes. The
Federal  Arbitration Act shall apply to the  construction,  interpretation,  and
enforcement of this arbitration provision.

LATE CHARGE.  If a payment is 19 days or more past due, Borrower will be charged
a late charge of 5% of the delinquent payment.

PERIODIC REVIEW.  Lender will review the loan  periodically.  At the time of the
review,  Borrower will furnish Lender with any additional  information regarding
Borrower's  financial  condition and business  operations that Lender  requests.
This information may include, but is not limited to, financial  statements,  tax
returns,  lists of assets and  liabilities,  agings of receivables and payables,
inventory schedules,  budgets and forecasts. If upon review, Lender, in its sole
discretion,  determines  that  there  has  been a  material  adverse  change  in
Borrower's  financial  condition,  Borrower  will be in default.  Upon  default,
Lender shall have all rights specified herein.

DEMAND  NOTE.  BORROWER  ACKNOWLEDGES  AND AGREES THAT (A) THIS NOTE IS A DEMAND
NOTE, AND LENDER IS ENTITLED TO DEMAND  BORROWER'S  IMMEDIATE PAYMENT IN FULL OF
ALL AMOUNTS  OWING  HEREUNDER,  (B) NEITHER  ANYTHING TO THE CONTRARY  CONTAINED
HEREIN OR IN ANY OTHER LOAN DOCUMENTS  (INCLUDING BUT NOT LIMITED TO, PROVISIONS
RELATING TO DEFAULTS,  RIGHTS OF CURE,  DEFAULT  RATE OF  INTEREST,  INSTALLMENT
PAYMENTS, LATE CHARGES, PERIODIC REVIEW OF BORROWER'S FINANCIAL CONDITIONS,  AND
COVENANTS) NOR ANY ACT OF LENDER PURSUANT TO ANY SUCH PROVISIONS  SHALL LIMIT OR
IMPAIR  LENDER'S RIGHT OR ABILITY TO REQUIRE  BORROWER'S  PAYMENT IN FULL OF ALL
AMOUNTS OWING HEREUNDER  IMMEDIATELY UPON LENDER'S  DEMAND,  AND (C) UPON LENDER
MAKING ANY SUCH  DEMAND,  LENDER  SHALL HAVE NO  OBLIGATION  TO MAKE ANY ADVANCE
UNDER THIS NOTE OR UNDER THE LOAN DOCUMENTS.

PRICING MATRIX. After the Inventory Borrowing Cap Reduction Date, the applicable
rate of  interest  shall be based on the  Borrower's  Tangible  Net Worth as set
forth on the pricing matrix attached hereto as Exhibit 'A.'

<PAGE>

PRIOR NOTE. The  Promissory  Notes from Borrower to Lender dated January 1, 1997
in the amount of $5,500,000.

GENERAL PROVISIONS. This Note is payable on demand. The inclusion of specific
default provisions or rights of Lender shall not preclude Lender's right to
declare payment of this Note on its demand. Lender may delay or forgo enforcing
any of its rights or remedies under this Note without losing them. Borrower and
any other person who signs, guarantees or endorses this Note, to the extent
allowed by law, waive presentment, demand for payment, protest and notice of
dishonor. Upon any change in the terms of this Note, and unless otherwise
expressly stated in writing, no party who signs this Note, whether as maker,
guarantor, accommodation maker or endorser, shall be released from liability.
All such parties agree that Lender may renew or extend (repeatedly and for any
length of time) this loan, or release any party or guarantor or collateral; or
impair, fail to realize upon or perfect Lender's security interest in the
collateral; and take any other action deemed necessary by Lender without the
consent of or notice to anyone. All such parties also agree that Lender may
modify this loan without the consent of or notice to anyone other than the party
with whom the modification is made.

UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY US (LENDER)
AFTER OCTOBER 3, 1989 CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT
FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER'S
RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY US TO BE
ENFORCEABLE.

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO
THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THE NOTE.

BORROWER:

Phoenix Gold International, Inc.

/s/ Timothy G. Johnson - V.P.
--------------------------------
    Authorized Officer

LENDER:

UNITED STATES NATIONAL BANK OF OREGON

By:/s/ Daniel A. Rice - V.P.
   ----------------------------------
   Authorized Officer


<PAGE>

                                  EXHIBIT 'A'
                                  -----------


This  exhibit is attached and made a part of that  certain  Promissory  Note for
$5,500,000,  dated  February 3, 1997,  from  Phoenix  Gold  International,  Inc.
(Borrower) to United States National Bank of Oregon (Lender).

                                 Pricing Matrix
                                 --------------

After the  Inventory  Borrowing  Cap  Reduction  Date,  the  applicable  rate of
interest  will be  governed  by the  Borrower's  Tangible  Net Worth and will be
reviewed and adjusted monthly, as expressed in the following matrix:

          Tangible Net Worth                 Interest Rate
          ------------------                 -------------

          Greater than or equal to           Prime + 0
          $12,8000,000.00

          Greater than or equal to           Prime + .50%
          $12,000,000.00 but less than
          $12,800,000.00

          Greater than or equal to           Prime + 1.25%
          $10,800,000.00 but less than
          $12,000,000.00

          Greater than or equal to           Prime + 2.00%
          $9,775,000.00 but less than
          $10,800,000.00

          Less than $9,775,000.00            Default Rate



PHOENIX GOLD INTERNATIONAL, INC.


By: /s/ Timothy G. Johnson
   ----------------------------------

Title:  V.P.
      -------------------------------


UNITED STATES NATIONAL BANK OF OREGON


By: /s/ Daniel A. Rice
   ----------------------------------

Title:  V.P.
      -------------------------------