THIS PROMISSORY NOTE REPLACES THAT CERTAIN PROMISSORY NOTE DATED OCTOBER 11,
                    2000 IN THE AMOUNT OF U.S. $2,550,000.00

                                 PROMISSORY NOTE


                                                               December 29, 2000
U.S. $650,000.00                                           San Diego, California


FOR VALUE  RECEIVED,  the  undersigned  nSTOR  TECHNOLOGIES,  INC.,  a  Delaware
corporation  with its  principal  place of business at 10140 Mesa Rim Road,  San
Diego, California, 92121 (hereinafter called "Maker"), hereby promises to pay to
the order of H. Irwin Levy, an individual resident of the State of Florida, with
a business  address at 100 Century  Boulevard,  West Palm Beach,  Florida  33417
(hereinafter  called  "Payee"),  at the  address of Payee's  principal  place of
business  stated  above,  or at such other place as the Payee may  designate  in
writing,  the sum of SIX HUNDRED FIFTY THOUSAND AND 00/100ths U.S. Dollars (U.S.
$650,000.00) (the "Principal Amount"),  plus interest on the outstanding balance
of the  Principal  Amount at the rate of ten  percent  (10%) per annum,  payable
quarterly,  from the date hereof until the date when said sum is paid in full in
accordance with the terms hereof.  The entire  Principal Amount plus all accrued
interest thereon shall be due and payable in full on January 31, 2002.

It is expressly  agreed that this  Promissory Note evidences a SIX HUNDRED FIFTY
THOUSAND AND 00/100ths U.S. Dollars (U.S. $650,000.00) revolving line of credit.
The  Principal  Amount which may be  outstanding  at any time under such line of
credit shall not exceed SIX HUNDRED FIFTY  THOUSAND AND 00/100ths  U.S.  Dollars
(U.S.  $650,000.00).  However,  this limitation  shall not be deemed to prohibit
Payee  from  advancing  any sum,  which  may,  in  Payee's  sole  and  exclusive
discretion,  be  necessary  or  desirable  in order to protect and  preserve the
effect and enforceability of this Promissory Note. Within the limits and subject
to the terms and conditions  hereof,  the Maker may borrow,  repay and re-borrow
under the revolving  line of credit  evidenced by this  Promissory  Note and all
shall be subject to the terms and conditions of this Promissory Note.

Upon the failure by Maker to pay interest in full on or before the date when due
hereunder,  the entire unpaid amount of this Note shall thereupon be immediately
due and payable, and the Payee shall have all rights and remedies provided under
this Note.

Maker shall have the right, in Maker's  discretion at any time,  without payment
of premium or penalty,  to repay in whole or in part the unpaid  balance of this
Note.

This Note  shall be  governed  by and  construed  under the laws of the State of
Florida.  The exclusive  venue for any litigation in connection  with or arising
out of this Note  shall be Palm  Beach  County,  Florida,  and the Maker  hereby
consents and submits to the jurisdiction of the state and federal courts sitting
in Palm Beach County, Florida.

MAKER HEREBY KNOWINGLY,  VOLUNTARILY AND  INTENTIONALLY  WAIVES THE RIGHT IT MAY
HAVE TO A TRIAL BY JURY IN RESPECT OF ANY  LITIGATION  BASED HEREON,  OR ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE.


nSTOR TECHNOLOGIES, INC.


By:   /s/ W. David Wright
 -----------------------------
Name:    W. David Wright
Title:  Controller