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                                                                   EXHIBIT 10.31

                         VARIABLE RATE PROMISSORY NOTE
                            Secured by Deed of Trust

IRVINE, California                  Date: March 20, 1997

FOR VALUE RECEIVED, the undersigned ("Borrower") promises to pay to the order of
UNION BANK OF CALIFORNIA, N.A. ("Bank") the principal sum of One Million Eight
Hundred Thousand Dollars ($1.800.000.00), or so much thereof as is advanced
under this Promissory Note ("Note"), together with interest on the balance of
such principal sum from time to time outstanding. at a per annum rate (the "Note
Rate") established from time to time as provided below.

This Note evidences a loan (the "Loan") from Bank to Borrower made pursuant to a
Loan Agreement (the "Loan Agreement") between Bank and Borrower of even date
herewith. This Note is secured by a Deed of Trust, Assignment of Rents. Security
Agreement and Fixture Filing (the "Deed of Trust") covering certain real
property and other collateral as described therein.

1.  PAYMENTS

(a)  Interest for the period commencing on the date funds are advanced hereunder
and ending on the last day of the month in which said funds are advanced shall
be paid in advance by deducting the amount due from the funds disbursed at
closing. Such interest for such period shall be calculated on the full amount
advanced under this Note.

(b)  Borrower shall pay to Bank equal monthly installments of principal and
interest ("Regular Payments") in such an amount that will, in the aggregate,
repay principal and accrued interest at the Note Rate over a two hundred forty
(240) month amortization period (the "Amortization Period"). Initially, the
Regular Payments shall be fifteen thousand twenty two and 23/100 Dollars
($15.022.23) per month. The Regular Payments are subject to change if the Note
Rate changes as provided in Sections 2 and 3 below.

(c)  Borrower shall make one hundred nineteen (119) monthly Regular Payments
commencing on May 1. 1997 and continuing on the first day of each month
thereafter, with a final payment of all remaining unpaid principal, accrued
interest and other sums due under this Note due and payable on April 1. 2007
(the "Maturity Date").

(d)  The amount of each year's interest on the Note will, as it accrues, be
calculated on the basis of a 360-day year, comprised of twelve 30-day months.
The Regular Payments will be applied first to accrued but unpaid interest then
due, and then to principal. The early or late date of making a Regular Payment
will be disregarded for purposes of allocating the payment between principal and
interest. For this purpose, the payment will be treated as though made on the
date due. The receipt of any check or other item of payment by Bank, at its
option, shall not be considered a payment on account until such check or other
item of payment is honored when presented for payment at the drawee bank. Bank
may delay the credit of such payment based upon Bank's schedule of funds
availability.

(e)  Borrower shall pay all amounts due under this Note in lawful money of the
United States to Union Bank of California, N.A., 18300 Von Karman Avenue Suite
200, Irvine, California 92612, or such other office as may be designated by Bank
from time to time.

2.  VARIABLE INTEREST RATE AND PAYMENT TERMS

(a)  Interest Rate. As long as Borrower has not exercised the Fixed Rate
Conversion Option described in Paragraph 3 below, interest on unpaid principal
shall accrue at an initial Note Rate, from the date of first disbursement of
Loan proceeds to the first Interest Change Date (as defined below), at a per
annum rate equal to seven and ninety seven one-hundredths percent(7.97%).
Thereafter, pursuant to this Section 2, interest shall accrue at a per annum
Note Rate equal to the Index Figure (as defined below) determined on each
Interest Change 
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Date plus two and twenty five one-hundredths percent (2.25%) (the "Spread"). The
initial Note Rate and any subsequent Note Rate determined with reference to the
Index Figure is defined as the "Variable Note Rate".

(b)  Defined Terms.

     (i) "Index" shall mean the LIBOR Base Rate which is the rate per annum
     (rounded upward, if necessary, to the nearest 1/100 of 1%) at which dollar
     deposits. in immediately available funds and in lawful money of the United
     States would be offered to Bank, outside of the United States for a three
     (3) month term, adjusted for reserve requirements imposed on Bank from time
     to time. If at any time the Index is no longer available, Bank, with notice
     to Borrower, will choose a new index that in Bank's sole determination is
     based on comparable information.
     (ii) "Banking Day" shall mean a day, other than a Saturday or a  Sunday, on
     which Bank is open for business for all banking functions in California.
     (iii)  "Index Figure" shall mean the Index as of the Interest Change Date.
     If the Interest Change Date falls on a date, which is not a Banking Day,
     the first immediately preceding Banking Day shall be used for purposes of
     determining the Index Figure.
     (iv) "Interest Change Date" shall mean July 1, 1997, and the first day of
     each month occurring at three (3) month intervals thereafter.
     (v) "Interest Period" shall mean the period of time from one Interest
     Change Date to the next or to the Maturity Date of this Note. as the case
     may be.

(c)  Changes in Interest Rate and Monthly Payments

     (i) Changes in Interest Rate.  The Variable Note Rate shall change on each
     Interest Change Date based on changes in the Index. On each Interest Change
     Date, Bank shall determine the Index Figure and set the Variable Note Rate
     for the next Interest Period.
     (ii) Changes in Regular Payment.  On each Interest Change Date, the Regular
     Payments will change to the amount necessary to amortize the unpaid
     principal owing at the Interest Change Date over the remaining Amortization
     Period at the new Variable Note Rate.  For example, if the Amortization
     Period is 240 months, and 12 whole calendar months have elapsed since the
     disbursement of the Loan, the new remaining Amortization Period would be
     228 months. Borrower will pay the amount of the new Regular Payment
     beginning on the first monthly payment date after the Interest Change Date
     and on each monthly payment date during the applicable Interest Period.
     (iii)  Notice of Changes.  Bank will deliver to Borrower notice of any
     changes in the Variable Note Rate or the Regular Payments, but the
     effectiveness and date of such changes shall not be affected by such notice
     or the lack thereof. There is no limit on the amount the Variable Note Rate
     or the Regular Payments on this Note may increase or decrease on any single
     Interest Change Date. or in the aggregate throughout the term of the Loan.

3.   FIXED RATE CONVERSION OPTION

(a)  Conversion option. Borrower shall have the one-time right and option (the
"Fixed Rate Conversion Option"). to convert the Variable Note Rate to a fixed
interest rate ("Fixed Note Rate"), which shall remain in effect until the
Maturity Date. The Fixed Note Rate shall be a per annum rate equal to the
Treasury Rate plus the Spread. "Treasury Rate" shall mean the interest rate
yield for US Government Treasury securities, as determined by Bank, having a
maturity date most nearly coinciding with the Maturity Date. Bank's
determination of such interest rate yield shall be based on information from the
Telerate or Reuters information services, the Western Edition of The Wall Street
Journal or other information sources Bank deems appropriate. Provided no Event
of Default then exists under the Loan Agreement or any other Loan Document (as
defined in the Loan Agreement), Borrower may exercise the Fixed Rate Conversion
Option by giving written notice to Bank of the exercise of such right, which
notice must be received by Bank on or before March 15, 2000. The Fixed Rate
Conversion Option shall become effective (the "Conversion Date") on the first
day of the calendar month following the date of exercise of the Fixed Rate
Conversion Option. Borrower's written notice of exercise of the Fixed Rate
Conversion Option shall be irrevocable.
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(b)  Change in Regular Payments. On the Conversion Date, the Regular Payment
will change to the amount necessary to amortize the unpaid principal owing at
the Conversion Date over the remaining Amortization Period at the Fixed Note
Rate. For example, if the Amortization Period is 240 months, and 12 whole
calendar months have elapsed since the disbursement of the Loan, the new
remaining Amortization Period would be 228 months. Borrower will pay the amount
of the new Regular Payment beginning on the first monthly payment date after the
Conversion Date and on each monthly payment date thereafter.

(c)  Notice of Changes.  Bank will notify Borrower in writing of the Fixed Note
Rate established by Bank following the Conversion Date, and the Regular Payments
established for the remaining term of this Note, but the effectiveness and date
of such changes shall not be affected by such notice or the lack thereof.

4.  LATE PAYMENTS. If Bank has not received the full amount of any Regular
Payment by the end of ten (10) calendar days after the date it is due, Borrower
will pay to Bank a late charge in the amount of six percent (6%) of the overdue
payment, such late charge to be immediately due and payable without notice or
demand by Bank. Borrower will pay this late charge only once on any late
payment. Borrower agrees that Bank will incur administrative costs and other
damages not compensated by payment of interest as a result of any Regular
Payment not being made when due and acknowledges that calculation of actual
damages is extremely difficult and impracticable and that the foregoing amount
is a reasonable estimate of these damages.

5.  INTEREST RATE FOLLOWING DEFAULT. From and after the Maturity Date, or such
earlier date as all sums owing on this Note become due and payable by
acceleration or otherwise, all sums owing on this Note (including accrued and
unpaid interest), shall, at the option of Bank, bear interest from the date the
payment becomes due until Borrower pays in full, at five percent (5%) above the
Note Rate (the "Default Rate").  The fact that accrued interest, at the Note
Rate. if not paid when due, will accrue interest at the Default Rate. as
hereinabove provided. may result in compounding of interest.

6.  PREPAYMENT

(a)  Voluntary Prepayment and Fee. This Note may be voluntarily prepaid in whole
only, provided Bank has received not less than five (5) business day's prior
written notice of Borrower's intention to make such prepayment. Except as
otherwise provided below. any prepayment of principal prior to the scheduled
payment date under this Note, whether voluntary or involuntary, shall be
accompanied by Borrower's payment of a prepayment fee to Bank determined as
follows:

     (i) if such  prepayment occurs during the first year of the Loan term, such
     prepayment fee shall equal one percent (1%) of the principal prepaid;
     (ii) if such prepayment occurs following the first year of the loan term
     and prior to exercise of the Fixed Rate Conversion Option. no prepayment
     fee shall be due; and
     (iii)  if such prepayment occurs following exercise of the Fixed Rate
     Conversion Option, the prepayment fee shall be the greater of:

          A.  One percent (1%) of the principal prepaid; or

          B.  The amount calculated under the following formula:

               Bank shall determine the difference between (i) the Fixed Note
               Rate and (ii) the rate of return ("Yield Rate") which Bank could
               obtain if it used the amount of such principal prepayment to
               purchase, at the bid price regularly quoted, U.S. Government
               Treasury securities having a maturity date most nearly coinciding
               with the Maturity Date of this Note and such securities were held
               by Bank until such Maturity Date.

  The above difference, if greater than zero, shall be multiplied by a fraction,
the numerator of which is the number of days from the date of prepayment to the
Maturity Date, and the denominator of which is 360 days.

               The above product shall then be multiplied by the amount of the
               principal so prepaid.
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               The above product shall then be discounted to present value using
               the Yield Rate as the annual discount factor.

     (iv) Notwithstanding subparagraph (iii) above. no prepayment fee shall be
     payable in respect of principal prepaid during the ninety (90) day period
     immediately preceding the Maturity Date.

(b)  In no event shall Bank be obligated to make any payment or refund to
Borrower, nor shall Borrower be entitled to any setoff or other claim against
Bank, should the return which Bank could obtain under the prepayment formula
exceed the interest that Bank would have received if no prepayment had occurred.

(c)  All prepayments shall include payment of accrued interest on the principal
amount so prepaid, shall be applied to payment of interest before application to
principal, and shall be applied to the most remote principal installment or
installments then unpaid (i.e.. the principal balance due on the Maturity Date
and then against installments due closest to the Maturity Date).

(d)  Such prepayment fee shall also be payable if prepayment occurs as the
result of any involuntary prepayment (e.g., proceeds of insurance or
condemnation) or the acceleration of the principal hereof by Bank because of any
default by Borrower (including any transfer or conveyance of any right, title or
interest in the real property encumbered by the Deed of Trust) that gives Bank
the right to accelerate the maturity of this Note pursuant to the terms of the
Deed of Trust. If, following any such acceleration. all or any portion of the
unpaid principal is satisfied, whether through sale of the property encumbered
by the Deed of Trust or other agreement securing this Note at a foreclosure held
thereunder or through the tender of payment at any time following such
acceleration, but prior to such a foreclosure sale, then such satisfaction of
principal shall be deemed an evasion of the prepayment provisions hereof, and
Bank shall, automatically and without notice or demand. be entitled to receive,
concurrently with such satisfaction of principal the prepayment fee set forth
above, and the obligation to pay such prepayment fee shall be added to the
principal hereof.

BORROWER HEREBY ACKNOWLEDGES AND AGREES THAT BANK WOULD NOT LEND TO BORROWER THE
LOAN EVIDENCED BY THIS NOTE WITHOUT BORROWER'S AGREEMENT TO PAY BANK A
PREPAYMENT FEE AS SET FORTH ABOVE. BORROWER EXPRESSLY WAIVES ANY RIGHT UNDER
CALIFORNIA CIVIL CODE SECTION 2954. 10 OR OTHERWISE TO PREPAY THE LOAN WITHOUT A
PREPAYMENT FEE AS HEREINABOVE SET FORTH. BORROWER ACKNOWLEDGES THAT PREPAYMENT
OF THE LOAN MAY RESULT IN BANK INCURRING ADDITIONAL COSTS, EXPENSES OR
LIABILITIES. BORROWER THEREFORE AGREES THAT THE PREPAYMENT FEE HEREIN PROVIDED
FOR REPRESENTS A REASONABLE ESTIMATE OF THE PREPAYMENT COSTS. EXPENSES OR
LIABILITIES BANK MAY INCUR ON A PREPAYMENT. BORROWER AGREES THAT BANK'S
WILLINGNESS TO OFFER THE FIXED INTEREST RATE DESCRIBED ABOVE TO BORROWER IS
SUFFICIENT AND INDEPENDENT CONSIDERATION, GIVEN INDIVIDUAL WEIGHT BY BANK, FOR
THIS WAIVER. BORROWER UNDERSTANDS THAT BANK WOULD NOT OFFER SUCH AN INTEREST
RATE TO BORROWER ABSENT THIS WAIVER. BORROWER HAS CAUSED THOSE PERSONS SIGNING
THIS NOTE ON ITS BEHALF TO SEPARATELY INITIAL SEPARATELY INITIALS THIS PARAGRAPH
BY PLACING THEIR INITIALS BELOW:

INITIALS: /S/ BP

(e)  Certificate. A certificate as to the amount of any prepayment fee payable
under this Paragraph, setting forth the basis for such fee, prepared by Bank and
submitted to Borrower shall be conclusive as to the matters set forth in this
Note. and this Note shall not be deemed to have been fully paid or satisfied
until such fee shall have been paid.


7.   DEFAULT AND ACCELERATION. If any Regular Payment under this Note is not
     paid by the end of ten (10) calendar days after it is due, or if any
     default exists under the Deed of Trust (Or other agreement securing this
     Note), the Loan Agreement or any other Loan Document. then the entire
     principal amount outstanding hereunder and all accrued interest thereon
     shall, without notice or demand. at once become 
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     due and payable at the sole option of Bank. Upon the occurrence of any such
     default, Bank may exercise any right or remedy under this Note, any other
     Loan Document or applicable law, regardless of any prior forbearance.

8.  MISCELLANEOUS

(a)  Joint and Several Liability. If more than one person or entity is signing
this Note as Borrower, their obligations under this Note will be joint and
several. As to any Borrower that is a partnership, the obligations of Borrower
under this Note are the joint and several obligations of each general partner
thereof. Any married person signing this Note agrees that recourse may be had
against community property assets and against his or her separate property for
the satisfaction of all obligations contained herein and in each other Loan
Document. With respect to any person executing this Note as a trustee of a
revocable trust, the liability of said person shall not be limited to said
person's interest in such trust or any trust property, and Bank shall have full
and immediate recourse to any and all property of said person in his or her
individual capacity for any and all obligations of said person in his or her
trust capacity.

(b)  Loan Agreement.  This Note is subject to the terms and conditions of the
Loan Agreement, which, among other things, contains provisions for acceleration
of the maturity of this Note.

(c)  Governing Law.  This Note is governed by the laws of the State of
California. Borrower and each other person or entity jointly liable under this
Note hereby consent to the jurisdiction of any competent court within the State
of California and further consent to service of process by any means authorized
by California law.

(d)  Waivers.  Borrower hereby waives presentment; demand; notice of dishonor;
notice of default or delinquency; notice of acceleration; notice of nonpayment;
notice of costs, expenses or losses and interest thereon; and notice of interest
on interest and late charges.

(e)  Delay in Enforcement.  If Bank delays in exercising or fails to exercise
any of its rights under this Note or any other Loan Document, that delay or
failure shall not constitute a waiver of any of Bank's rights, or of any breach,
default or failure of condition of or under this Note or any other Loan
Document. No waiver by Bank of any of its rights, or of any such breach, default
or failure of condition, shall be effective unless the waiver is expressly
stated in a writing signed by Bank. Borrower hereby waives the right to assert
the defense of any statute of limitations to any debt or obligation evidenced by
this Note or any other Loan Document.

(f)  Assignment.   This Note inures to and binds the heirs, legal
representatives, successors and assigns of borrower and Bank; provided, however,
that Borrower may not assign this Note or any right to funds advanced or to be
advanced hereunder, or assign or delegate any of its rights or obligations,
without the prior written consent of Bank in each instance and in the sole
discretion of Bank. Bank may transfer this Note and all other Loan Documents,
and may sell or assign participation's or other interests in all or part of the
Loan, on the terms and subject to the conditions of the Loan Documents, all
without notice to or the consent of Borrower. In connection with any such sale,
assignment or participation, Bank may disclose to any prospective or actual
transferee all information from time to time provided by or on behalf of
Borrower in respect of the Loan, any collateral security therefor and any person
or entity obligated hereunder. All references in this Note to Bank shall mean
and include any subsequent holder hereof.

(g)  Recovery of Bank's Costs. If any amounts owing under this Note are not paid
when due, Borrower shall pay all costs and expenses, including reasonable
attorneys' fees, incurred by Bank in the collection or enforcement of this Note.

(h)  Cumulative Remedies. All of Bank's remedies in connection with this Note or
under applicable law shall be   cumulative, and Bank's exercise of any one or
more of those remedies shall not constitute an election of remedies.

IN WITNESS WHEREOF, Borrower has duly executed and delivered this Note to Bank
as of the date first above written.
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BORROWER:

RESEARCH ENGINEERS. INC.,
A Delaware Corporation


By: /S/ BRIAN PAUL
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Title:   Secretary
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