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                                                                Exhibit 10.17 

                               LICENSE AGREEMENT

        THIS License Agreement ("Agreement") is made as of 07/18/96 (the
"Effective Date") by and between Read-Rite Corporation, a Delaware corporation,
located at 345 Los Coches Street, Milpitas, CA 95035 ("RRC"), and Censtor
Corporation, a California corporation, located at 530 Race Street, San Jose, CA
95126 ("Censtor").

                                   BACKGROUND

        Censtor has sold certain assets to RRC pursuant to an Agreement for
Purchase and Sale of Assets dated as of March 29, 1996 ("Asset Purchase
Agreement"). This Agreement sets forth the terms under which Censtor will
license its intellectual property rights to RRC in conjunction with the Asset
Purchase Agreement.

        NOW, THEREFORE, in consideration of the mutual covenants and premises
herein contained, the parties hereto agree as follows:

1.      DEFINITIONS

        1.1  "Patents" shall mean any and all rights in and to any and all (i)
        patents owned by Censtor as of the Effective Date (ii) patent
        applications whenever filed if based on inventions made by Censtor on or
        prior to the Effective Date, (iii) patents issuing on such patent
        applications, and (iv) patents licensed by Censtor from a third party
        licensor as of the Effective Date which Censtor has a right to license
        to RRC without additional payments or other obligations to such third
        party licensor, including without limitation those patents listed in
        Exhibit A hereto, provided that Censtor shall sublicense the patents to
        RRC that require such additional payments or obligations to the extent
        they may be sublicensed if RRC elects to make such additional payments
        or assume such other obligations. This definition of Patents shall
        include any foreign counterparts, divisions, substitutions,
        re-examinations, continuations, continuations-in-part, reissues, patents
        of addition, renewals and extensions of any patents or patent 
        applications owned by Censtor.

        1.2  "Software" shall mean all software (i) owned by Censtor as of the
        Effective Date, (ii) developed by Censtor on or prior to the Effective
        Date, or (iii) licensed to Censtor from a third party licensor as of
        the Effective Date which Censtor has a right to license to RRC without
        additional payments or other obligations to such third party licensor,
        provided that Censtor shall sublicense the software that requires such
        additional payments or obligations to RRC to the extent it may be
        sublicensed if RRC elects to make such additional payments or assume
        such other obligations. The Software licensed hereunder shall be
        provided in source code form, except that if such Software is licensed
        by Censtor from a third party and can only be licensed to RRC in binary
        code form, such Software shall be provided in binary code form to RRC.

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        1.3  "Technology" shall mean any and all rights in and to any and all
        technology and know-how (i) owned by Censtor as of the Effective Date,
        (ii) developed by Censtor on or prior to the Effective Date, or (iii)
        licensed to Censtor from a third party licensor as of the Effective Date
        which Censtor has a right to license to RRC without additional payments
        or other obligations to such third party licensor, provided that Censtor
        shall sublicense the technology to RRC that requires such additional
        payments or obligations to the extent it may be sublicensed if RRC
        elects to make such additional payments or assume such other
        obligations. "Technology" shall include without limitation, technical
        information, know-how, negative know-how, trade secrets, processes,
        procedures, compositions, devices, methods, formulas, protocols,
        techniques, designs, drawings, mask works, or data.

        1.4  "Intellectual Property Rights" means, collectively, the Patents,
        Technology and Software and all current and future worldwide patents,
        trade secrets, copyrights, copyright registrations and applications
        therefor, moral rights, and all other intellectual property rights and
        proprietary rights arising under the Patents, Technology or Software,
        whether arising under the laws of the United States or any other state,
        country or jurisdiction, excluding any trademarks or servicemarks.

        1.5  "Affiliate" shall mean a company that is controlled by,
        controlling, or in common control with a party hereto. Control shall
        mean that more than fifty percent (50%) of the stock entitled to vote
        for the election of directors is directly owned by a party hereto, but
        only so long as such ownership exists. An "RRC Affiliate" shall
        include, but not be limited to, Read-Rite International.

II.     GRANT

        2.1  Grant.  Censtor grants to RRC a worldwide, perpetual, royalty-free,
        fully-paid up, non-exclusive license, including the right to sublicense
        to RRC Affiliates, under the Intellectual Property Rights to make, have
        made, use, sell, offer for sale, import, export, display, modify, and
        distribute any products, create derivative works, practice any method,
        process, or procedure, and otherwise exploit the Patents, Technology or
        Software. The license granted under this Section 2.1 shall be revocable
        solely in the event that RRC fails to make the Final Payment referenced
        in the Asset Purchase Agreement on the Final Payment Date defined
        therein, net of any amounts withheld as security for claims under
        Section 8 thereof. Upon RRC's payment to Censtor of such Final Payment,
        the licenses granted hereunder shall become irrevocable, notwithstanding
        any withholding by RRC of a portion of such Final Payment pursuant to
        Section 8.2 of the Asset Purchase Agreement.

        2.2  Delivery.  Censtor has delivered to RRC copies of all the Patents,
        Technology and Software as of the Effective Date, which copies shall be
        the property of RRC.

        2.3  Security Interest.  23.1  Grant.  RRC hereby retains and Censtor
        hereby grants to RRC a security interest in the Intellectual Property
        Rights licensed hereunder to RRC to secure Censtor's obligations under
        Sections 2.4, 3.1 or 3.2 of this Agreement (the "Secured Obligations")
        for the period commencing on the Effective Date and terminating


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on the sixth anniversary of the Effective Date (the "Termination Date"). Censor
agrees to promptly execute documents requested by RRC to perfect and protect
such security interest at the Effective Date.

2.3.2. Termination of Security Interest; Escrow. Censtor may terminate the
security interest created hereunder on the third (3rd) anniversary of the
Effective Date by depositing an amount (the "Escrow Amount") that is the
greater of (i) four million dollars ($4,000,000) or (ii) the full amount of any
claim or claims asserted in writing by RRC against Censtor for breach of any
Secured Obligations (a "Secured Obligation Claim") on or prior to such
anniversary in cash into an escrow account established pursuant to a mutually
agreeable escrow agreement. Said escrow agreement shall provide for a release
of all or a portion of the Escrow Amount to RRC to satisfy claims by RRC
against Censtor hereunder relating to any breach of the Secured Obligations.
Thereafter, Censtor may reduce the Escrow Amount by one million dollars
($1,000,000) on each of the fourth (4th) and fifth (5th) anniversaries of the
Effective Date, respectively, provided, however, that any such reduction shall
not cause the funds remaining in the escrow to be less than the amount of any
Secured Obligation Claim or Claims by RRC outstanding on such anniversaries. If
RRC has an outstanding Secured Obligation Claim at the Termination Date then
(i) if Censtor has not terminated the security interest by depositing the
Escrow Amount, the security interest shall survive until the claims are finally
resolved unless Censtor deposits cash in the full amount of such claim in an
escrow account to secure such claims, or (ii) if Censtor has terminated the
security interest, the escrow shall survive the Termination Date until such
claims are finally resolved.

2.3.3. Senior Security Interest: Subordination. Censtor represents and warrants
that the security interest granted herein is senior to any other security
interest granted in the Patents, Software or Technology. Censtor shall not
grant, issue, or convey security interests to which the security interest
granted herein would be subordinate, except (i) any security interest granted
for money borrowed, provided that the amount borrowed shall not exceed two
million dollars ($2,000,000) at any time, and any such obligation to repay
money shall be a Secured Obligation hereunder, and RRC shall have the option to
repay on Censtor's behalf such borrowings at any time and to add the amount of
such repayments to any amounts due upon exercise of the security interest, and
(ii) RRC acknowledges that Denki Kagaku Kogyo Kabushiki Kaisha ("Denka") holds
a security interest in certain Censtor Patents. To address said security
interest, concurrently herewith Censtor has delivered to Censtor's counsel such
sums as are required to satisfy any obligations of Censtor to Denka necessary
to obtain a release of said security interest (the "Satisfaction Payment"), and
caused to be delivered by Denka to Censtor's counsel a fully executed,
irrevocable release of said security interest (the "Release"). Censtor
covenants that, on or before July 31, 1996, it will cause its counsel to
simultaneously deliver the Satisfaction Payment to Denka, and the Release to
RRC. RRC hereby agrees that the security interest granted hereunder is and will
be subject to (i) any license granted by Censtor in the Intellectual Property
Rights, including licenses granted after the date of this Agreement, and (ii)
any security interest to secure obligations for money borrowed as provided
above, including any such security interest granted after the date of this
Agreement. RRC hereby agrees to promptly execute documents reasonably requested
by 


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        Censtor to acknowledge release of the security interest at the
        Termination Date (or such later date as provided above) and to
        acknowledge the subordination of its security interest for money
        borrowed granted by Censtor as provided above. 

        2.4     Most Favored Licensee.  If Censtor licenses the Intellectual
        Property Rights to any person, firm or corporation under more favorable
        terms and conditions than those granted to RRC, it shall provide RRC the
        benefit of those terms and conditions effective upon the date of
        execution of the more favorable license. For the purposes of determining
        whether a license is more favorable than the present Agreement under
        this  Section 2.4, the parties agree to consider each transaction as a
        whole. The parties agree that should Censtor enter into a new components
        supply license, it shall deliver to RRC an initial summary of the terms
        of such license. RRC shall have fifteen (15) days following receipt of
        such summary to elect to retain RRC's existing license per the terms set
        forth herein, or to elect on a preliminary basis to accept the terms of
        said new license. In the latter event, Censtor shall prepare and submit
        for RRC's review a draft license agreement, together with a signed
        certificate of an officer of Censtor stating that said license
        agreement is the same as the new components supply license in all
        material respects. RRC shall thereafter have fifteen (15) additional
        days to make its final election to accept or reject said new proposed
        license. In addition, Censtor shall not grant rights in the Intellectual
        Property Rights to any disk drive manufacturer under terms and
        conditions more favorable than those granted by Censtor to Western
        Digital Corporation ("WDC") or Maxtor Corporation ("MC"), respectively,
        without offering such terms to WDC and MC; provided, however, that
        Censtor shall not be required to (i) compare any terms granted to either
        WDC or MC to those granted to the other, or (ii) offer license terms to
        WDC or MC if at any time following the Effective Date WDC or MC, as the
        case may be, ceases to be a licensee of Censtor. If Censtor is required
        by this Section to offer license terms to either WDC or MC, Censtor
        shall offer such terms pursuant to procedures specified in its licenses
        with WDC or MC to the extent such procedures exist and, to the extent
        they do not, pursuant to the procedures specified above for offering
        license terms to RRC. 

        2.5     Limitations.  No license or other right is granted, by
        implication, estoppel or otherwise, to RRC or any other third parties
        except for the licenses and rights expressly granted in this Agreement. 


III.    REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION.

        3.1     Representations and Warranties. As of the Effective Date of this
        Agreement, Censtor represents and warrants that, except as set forth in
        Schedule 3.1 hereto, (i) Censtor has the right and authority to enter
        into this Agreement and to grant the rights and licenses set forth
        herein; (ii) to Censtor's best knowledge the use of the Intellectual
        Property Rights in connection with Censtor's business operations in the
        ordinary course prior to the Effective Date does not constitute a direct
        infringement of the intellectual property rights of any other person,
        (iii) Censtor, to its best knowledge is not aware of any express
        challenge to, or any facts or circumstances that, on their face,
        constitute the basis for a challenge to, the validity, scope,
        enforceability, ownership or inventorship of the 

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         Intellectual Property Rights; (iv) Censtor has not received any notice
         or other communication alleging that the manufacture, sale or use of
         products incorporating the Patents, Software or Technology infringe the
         intellectual property rights of any third party or violate any other
         third party rights; (v) Censtor has not granted any rights in the
         Patents, Software and Technology to any third party that are
         inconsistent with the rights and licenses granted to RRC by this
         Agreement, and (vi) Censtor has delivered to RRC all of the Patents,
         Technology and Software.

         3.2  Covenants.  Censtor covenants (i) that it will not grant any
         rights in the Patents, Software or Technology to any third party that
         conflict with the rights and licenses granted to RRC by this Agreement;
         and (ii) that as of the Effective Date of this Agreement there are no
         circumstances other than RRC's breach of this Agreement or patent
         expiration whereby the rights and licenses granted hereunder would be
         materially diminished, or have the effect of materially diminishing
         such rights and licenses. RRC may, upon breach of this Section,
         exercise its security interests under Section 2.2 above and the right
         to seek indemnification under Section 3.4 below.

         3.3  RRC Representations and Warranties.  As of the Effective Date of
         this Agreement, RRC represents and warrants that RRC has the right and
         authority to enter into this Agreement.

         3.4  Indemnification.  As the sole remedy for a material breach of a
         party's obligations under this Section 3, each party (as indemnitor)
         agrees to defend, indemnify, and hold the other party (as indemnitee),
         its Affiliates, shareholders, employees and agents harmless against any
         loss, liability, and expense (including reasonable attorneys' fees)
         arising from such material breach except in the case of RRC, RRC may
         also exercise the remedies provided by Section 7.2. The indemnitor
         shall have no obligation to indemnify the indemnitee under this section
         unless the indemnitee provides the indemnitor with (i) prompt written
         notice of such claim or action, (ii) control and authority over the
         defense or settlement of such claim or action, and (iii) proper and
         full information and reasonable assistance to defend and/or settle such
         claim or action.

         3.5  Disclaimer.  EXCEPT AS EXPRESSLY WARRANTED IN SECTION 3.1 ABOVE,
         (I) CENSTOR'S PATENTS, SOFTWARE, TECHNOLOGY AND INTELLECTUAL PROPERTY
         RIGHTS ARE PROVIDED TO RRC "AS IS" WITHOUT WARRANTY OF ANY KIND, (II)
         THE ENTIRE RISK AS TO THE RESULTS AND PERFORMANCE OF ANY HARDWARE OR
         SOFTWARE IS ASSUMED BY THE RECEIVING PARTY; AND (III) CENSTOR DISCLAIMS
         ALL WARRANTIES, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO ITS
         DELIVERABLES, INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF
         MERCHANTABILITY, NON-INFRINGEMENT AND FITNESS FOR A PARTICULAR PURPOSE.
         IN NO EVENT SHALL CENSTOR BE LIABLE FOR COST OF PROCUREMENT OF
         SUBSTITUTE PRODUCTS, SERVICES, OR TECHNOLOGY. THESE LIMITATIONS SHALL
         APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED
         REMEDY.


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IV.     CONFIDENTIAL INFORMATION

        4.1  General.  The parties may, from time to time, in connection with
        this Agreement, disclose to each other Confidential Information.
        "Confidential Information" shall mean any information disclosed in
        writing by a party to this Agreement to any of the other parties to this
        Agreement, and marked by the disclosing party with the legend
        "CONFIDENTIAL" or other similar legend sufficient to identify such
        information as confidential proprietary information of the disclosing
        party. Confidential Information shall include the terms and conditions
        of this Agreement, but either party may disclose the existence and
        purpose of this Agreement as recited in the Background section. Neither
        party shall use any Confidential Information of the other party except
        as expressly authorized under this Agreement, and each party will use
        best efforts to prevent the disclosure of the other party's Confidential
        Information to third parties; provided that the parties may disclose
        Confidential Information, with similar protections in place, to the
        extent reasonably necessary to exploit the rights and license granted to
        such party hereunder (including the rights to grant and authorize
        sublicenses); and provided further that the recipient party's
        obligations under this Section 4 shall not apply to Confidential
        Information that:

                4.1.1 is disclosed orally without express designation as
                      Confidential Information; provided, however, that the
                      recipient party's obligations under this Section 4
                      shall apply to information disclosed orally if such
                      information is confirmed in writing as "CONFIDENTIAL"
                      by the disclosing party within thirty (30) days after
                      disclosure thereof;

                4.1.2 is in the recipient party's possession at the time of
                      disclosure thereof;

                4.1.3 is or later becomes part of the public domain through
                      no fault of the recipient party;

                4.1.4 is received from a third party having no obligations of
                      confidentiality to the disclosing party;

                4.1.5 is developed independently by the recipient party without
                      reliance upon or use of the disclosing party's
                      Confidential Information; or

                4.1.6 is required by law or regulation to be disclosed;
                      provided, however, that the party subject to such
                      disclosure requirement has provided written notice to
                      the other party promptly to enable such other party to
                      seek a protective order or otherwise prevent disclosure
                      of such Confidential Information.

        The parties agree to terminate on the Effective Date, all prior
        confidentiality and nondisclosure agreements between the parties
        including the Bilateral Non-Disclosure Agreement dated January 11, 1996;
        provided, however, that disclosures of Confidential


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        Information made prior to the Effective Date shall continue to be
        governed by the terms of the applicable confidentiality or
        nondisclosure agreement.

V.      PATENTS AND INVENTIONS

        5.1     Disclosure of Inventions. Censtor will promptly disclose to RRC
        in writing any invention conceived of or reduced to practice by Censtor,
        its employees, contractors, or agents, alone or jointly with others, as
        of the Effective Date of the Agreement. Censtor shall release its
        employees from any confidentiality obligations to the extent such
        obligations prohibit the disclosure of Censtor Confidential Information
        to RRC; provided, however, that nothing in this Agreement shall require
        Censtor, or its employees, contractors, or agents, to disclose
        Confidential Information of any third party unless Censtor is authorized
        to do so by license or agreement with such third party.

        5.2     Applications. Censtor shall file patent applications based on
        the Patents and maintain the Patents during the term of this Agreement.
        During the term of this Agreement, Censtor shall provide RRC with a
        report once per month containing a list of patent applications based on
        the patents that Censtor elects to abandon, or Patents for which Censtor
        elects not to pay any fee required to maintain such Patent. Censtor
        shall consider any request by RRC to file or continue the prosecution of
        applications for Patents. If Censtor elects not to file or continue the
        prosecution of an application requested by RRC, RRC may request
        Censtor's consent to pursue and have assigned to RRC such draft patent
        application or patent application, which consent may be withheld only if
        Censtor determines that the coverage of such draft patent application or
        application is substantially covered by another application that is
        being pursued by Censtor. If consent is granted and RRC files or
        continues the prosecution application, RRC shall pay for the costs,
        including reasonable attorney's fees and related filing and maintenance
        costs, and RRC agrees to license Censtor on a world-wide, royalty-free,
        fully paid, irrevocable, non-exclusive basis with a right of sublicense
        to Patents issuing on such applications, provided Censtor pays one-half
        of the legal fees and costs incurred by RRC for such Patents.

VI. INFRINGEMENT

        6.1     Notice of Infringement. If RRC learns of any infringement of
        Censtor's Intellectual Property Rights, RRC shall so inform Censtor in
        writing and shall provide Censtor with reasonable evidence of the
        infringement.

        6.2     Legal Action.   RRC may request that Censtor take legal action
        against an alleged infringement of the Intellectual Property Rights. If
        Censtor initiates such action at RRC's request, it shall do so at its
        sole expense and RRC shall render all reasonable assistance that may be
        required by Censtor for such action. RRC shall not make any claim for
        damages recovered by Censtor. If Censtor does not initiate the legal
        action requested by RRC, RRC may request Censtor to consent to RRC
        initiating such action in Censtor's

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        name. If Censtor consents to such representation, RRC may initiate such
        action at its sole expense and shall be entitled to take all necessary
        steps in the name of Censtor. Censtor shall render all reasonable
        assistance that may be required by RRC for such action and Censtor shall
        not make any claim for damages recovered by RRC.

        If Censtor does not consent to RRC commencing such action, then upon the
        request of RRC the following representatives of RRC and Censtor shall
        meet within ten (10) days after the date of the Censtor decision to
        attempt to resolve the matter: the General Counsel of RRC and the
        President of Censtor. If the matter has not been resolved within twenty
        (20) days of their first meeting, the parties shall attempt in good
        faith to resolve the controversy or claim in accordance with the
        Mediation Service of the Santa Clara County Bar Association. 

        6.3  Cooperation.  Each party shall cooperate with the other in
        litigation proceedings instituted under this Agreement (including
        without limitation by joining as a nominal party), but at the expense of
        the party by whom suit is brought. The party bringing the suit will
        control that litigation, except that the other party may elect to be
        represented at its own expense by counsel of its choice. Upon the
        request and at the expense of the requesting party, the other party
        shall make available at reasonable times and under appropriate
        conditions all relevant personnel, records, papers, information,
        samples, specimens and other similar materials in its possession.

        6.4  Attorneys' Fees.  Except as set forth in Section 3
        (Indemnification), each party shall bear its own attorney's fees and
        costs in connection with any dispute between the parties arising under
        this Agreement.


VII.  TERM AND REMEDIES

        7.1. Term.  This Agreement shall be perpetual.

        7.2  Remedies for Breach.  If Censtor is in material default of any
        provision of this Agreement other than the Secured Obligations, and such
        material default is not corrected within thirty (30) day of receipt of
        written notice of such default from RRC, RRC may pursue its available
        remedies in law or equity. If Censtor is in material default of the
        Secured Obligations, and such material default is not corrected within
        thirty (30) days of receipt of written notice of such material default,
        RRC shall first pursue a remedy of monetary damages or injunctive relief
        pursuant to Section 3.4. If RRC does not receive full and complete
        payment or settlement of a claim based on a material default by Censtor
        of a Secured Obligation within thirty (30) days after the date of final
        determination of such claim, RRC shall have the right to proceed against
        the security interest as provided under Section 2.3, including all
        rights of a secured party under the California Uniform Commercial Code,
        in addition to any other rights it may have in law or equity.

        7.3  Remedies for Insolvency.  RRC shall have the right to exercise the
        security interest cited under Section 2.3, in addition to any other
        rights it may have in law and equity, by


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        writing immediately if Censtor (i) voluntarily or involuntarily becomes
        the subject of a petition in bankruptcy or of any proceeding relating to
        insolvency, receivership, liquidation, or composition for the benefit of
        creditors; or (ii) admits in writing its inability to pay its debts as
        they become due.

        7.4     Survival. The rights and obligations under Sections 2, 3, 4, 5,
        6, 8 and 9 shall survive termination of this Agreement.

VIII.   LIMITATION ON LIABILITY

        UNDER NO CIRCUMSTANCES, OTHER THAN AS PROVIDED FOR IN SECTION 3 ABOVE,
        SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY LOST DATA, LOST
        PROFITS, BUSINESS INTERRUPTION OR FOR ANY INDIRECT, INCIDENTAL, SPECIAL,
        CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES (EVEN IF THAT PARTY HAS
        BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES), INCLUDING WITHOUT
        LIMITATION, LOSS OF REVENUE OR ANTICIPATED PROFITS OR LOST BUSINESS.
        NOTWITHSTANDING THE FOREGOING, THE MAXIMUM LIABILITY OF EITHER PARTY TO
        THE OTHER FOR DAMAGES, OTHER THAN LIABILITY OF CENSTOR UNDER SECTION 3,
        FOR ANY AND ALL CAUSES WHATSOEVER, REGARDLESS OF THE FORM OF ACTION,
        WHETHER IN CONTRACT, TORT OR OTHERWISE, SHALL BE LIMITED TO THE PURCHASE
        PRICE SET FORTH IN THE ASSET PURCHASE AGREEMENT OF NINE MILLION
        TWENTY-FIVE THOUSAND DOLLARS ($9,025,000); THE MAXIMUM LIABILITY OF
        CENSTOR UNDER SECTION 3 TO RRC FOR DAMAGES FOR ANY AND ALL CAUSES
        WHATSOEVER, REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT, TORT
        OR OTHERWISE, SHALL BE LIMITED TO TEN MILLION DOLLARS ($10,000,000).

IX.     GENERAL

        9.1.    Assignment. This Agreement may not be assigned by Censtor
        without the prior written consent of RRC, except to a party that
        succeeds to all or substantially all of Censtor's business or assets
        relating to this Agreement whether by sale, merger, operation of law or
        otherwise; provided that such assignee or transferee promptly agrees in
        writing to be bound by the terms and conditions of this Agreement.
     

        9.2     Complete Agreement. This Agreement, the exhibits attached
        hereto, and the Asset Purchase Agreement, constitute the entire
        understanding and only agreements between the parties with respect to
        the subject matter hereof and supersede any and all prior negotiations,
        representations, agreements, and understandings, written or oral, that
        the parties may have reached with respect to the subject matter hereof.
        No provision of this Agreement shall be varied, contradicted or
        explained by any oral agreement, course of  


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        dealing or performance or any other matter not set forth in an agreement
        in writing and signed by all parties.

        9.3.  Force Majeure.  In the event either party hereto is prevented from
        or delayed in the performance of any of its obligations hereunder by
        reason of acts of God, war, strikes, riots, storms, fires, or any other
        cause whatsoever beyond the reasonable control of the party, the party
        so prevented or delayed shall be excused from the performance of any
        such obligation to the extent and during the period of such prevention
        or delay. In the event of such an event, the party whose performance is
        prevented or delayed shall give prompt notice to the other party of the
        occurrence of such event and of removal of such event.

        9.4.  Notices.  All notices, requests, consents and other communications
        required or permitted hereunder shall be in writing and shall be
        delivered, sent by telecopy, or mailed first-class postage prepaid,
        registered or certified mail, and shall be effective upon receipt by the
        addressee, if addressed as follows:

        If to RRC:            Read-Rite Corporation
                              345 Los Coches Street
                              Milpitas, CA 95035-5428
                              Attention: Rex S. Jackson, V.P. & General Counsel
                              Telephone:  (408) 262-6700
                              Telecopy:   (408) 945-9644

        with a copy to:       Wilson Sonsini Goodrich & Rosati, P.C.
                              650 Page Mill Road
                              Palo Alto, CA 94304-1050
                              Attention: Frances S. Currie, Esq.
                              Telephone: (415) 493-9300
                              Telecopy: (415) 493-6811

        If to Censtor:        Censtor Corporation
                              530 Race Street
                              San Jose, CA 95126
                              Attention: Garry A. Garrettson, President & CEO
                              Telephone: (408) 298-8400
                              Telecopy: (408) 288-9910

        with a copy to:       Heller, Ehrman, White & McAuliffe
                              525 University Avenue
                              Palo Alto, California 94301-1900
                              Attention: Matthew P. Quilter, Esq.
                              Telephone: (415) 324-7000
                              Telecopy: (415) 324-0638

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9.5     Governing Law. This Agreement shall be governed by, and construed and
interpreted in accordance with, the laws of the State of California; provided,
however, that all questions with respect to validity of any patents or patent
applications shall be determined in accordance with the laws of the respective
country in which such patents or patent applications shall have been granted or
filed, as applicable.

9.6     Dispute Resolution. The parties shall resolve any disputes arising
under this Agreement utilizing the procedures set forth in Section 8.4 of the
Asset Purchase Agreement, to which this Agreement is attached as Exhibit C.

9.7     Absence of Third Party Beneficiary Rights. No provisions of this
Agreement are intended, nor will be interpreted, to provide or create any third
party beneficiary rights or any other rights of any kind in any client,
customer, affiliate, stockholder, partner or employee of any party hereto or any
other person or entity unless specifically provided otherwise herein, and,
except as so provided, all provisions hereof will be personal solely between the
parties to this Agreement. 

9.8     Bankruptcy Code. All rights and licenses granted under or pursuant to
this Agreement by Censtor to RRC are and shall otherwise be deemed for the
purposes of Section 365(n) of the United States Bankruptcy Code, 11 U.S.C.
Section 101, et seq. (the "Bankruptcy Code"), licenses of rights to
"intellectual property" as defined under Section 101(56) of the Bankruptcy
Code. The parties agree that RRC, as a licensee of such rights and licenses,
shall retain and may fully exercise all of its rights and elections under the
Bankruptcy Code.

9.9     No Waiver. A waiver, express or implied, by either party of any right
under this Agreement or of any failure to perform or breach hereof by the other
party hereto shall not constitute or be deemed to be a waiver of any other
right hereunder or of any other failure to perform or breach hereof by such
other party, whether of a similar or dissimilar nature thereto.

9.10    Headings. Headings included herein are for convenience only, do not
form a part of this Agreement and shall not be used in any way to construe or
interpret this Agreement.

9.11    Severability. If any provision of this Agreement shall be found by a
court of competent jurisdiction to be void, invalid or unenforceable, the same
shall be reformed to comply with applicable law or stricken if not so
reformable, so as not to affect the validity or enforceability of the remainder
of this Agreement, provided that the reformation complies with the intent of
the parties.



                                       11

<PAGE>   12
        9.12.    Counterparts. This Agreement may be executed in counterparts,
        each of which shall be deemed an original, but which together shall
        constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
representatives to execute this Agreement.


Censtor Corporation ("Censtor")                 Read-Rite Corporation ("RRC")


By: /s/ R.M. Krapf                                  By: /s/ Rex S. Jackson
   ----------------------------                     ----------------------------
Name: Russell M. Krapf                          Name: Rex S. Jackson
      -------------------------                        -------------------------
Title: President                                Title: Vice President and
       ------------------------                        General Counsel
                                                       -------------------------




                                       12




<PAGE>   13
                                   EXHIBIT A

                                    Patents



                                       13
<PAGE>   14
CONFIDENTIAL

                                CENSTOR PATENTS

ISSUED PATENTS

        CNR-341         RECORDING HEAD SLIDER ASSEMBLY

        U.S. Pat. No.   4,636,894       Granted         Jan. 13, 1987
        Inventor        Mo              Filed           March 22, 1984

        CNR-34101       European Patent Based On CNR-341

        EP Pat. No.     0,155,756       Granted         Oct. 24, 1990

        CNR-34102       Japanese Patent Based On CNR-341

        Jap. Pat. No.   1,696,196       Granted         Sept. 28, 1992

        CNR-342         SLIDER ASSEMBLY FOR SUPPORTING A MAGNETIC HEAD

        U.S. Pat. No.   4,757,402       Granted         July 12, 1988
        Inventor        Mo              Filed           Oct. 3, 1986

        CNR-34201       European Patent Based On CNR-342

        EP Pat. No.     0,262,655       Granted         Jan. 13, 1994

        CNR-343         MAGNETIC HEAD AND MULTI-TRACK TRANSDUCER FOR
                        PERPENDICULAR RECORDING AND METHOD FOR FABRICATING

        U.S. Pat. No.   4,423,450       Granted         Dec. 23, 1983
        Inventor        Hamilton        Filed           May 6, 1981

        CNR-34301       Great Britain Patent Based On CNR-343

        GB Pat. No.     2,111,741       Granted          April 16, 1986

        CNR-34302       European Patent Based On CNR-343

        EP Pat. No.     0,077,832       Granted         July 1, 1988

        CNR-34304       Japanese Patent Based On CNR-343

        Jap. Pat. No.   1,822,410       Granted         Feb. 10, 1994

        

<PAGE>   15
                                  CONFIDENTIAL

                                CENSTOR PATENTS

ISSUED PATENTS CONT'D
---------------------


        CNR-001         THIN-FILM, CROSS-FIELD, CLOSED-FLUX, ANISOTROPIC
                        ELECTROMAGNETIC FIELD DEVICE

        U.S. Pat. No.   4,751,598       Granted         June 14, 1988
        Inventor        Hamilton        Filed           Feb. 1, 1985

        CNR-304         PLANARIZED READ/WRITE HEAD AND METHOD

        U.S. Pat. No.   4,860,139       Granted         Aug. 22, 1989
        Inventor        Hamilton        Filed           June 19, 1987

        CNR-309         INTEGRATED MAGNETIC READ/WRITE
                        HEAD/FLEXURE/CONDUCTOR STRUCTURE

        U.S. Pat. No.   5,041,932       Granted         Aug. 20, 1991
        Inventor        Hamilton        Filed           Nov. 27, 1989

        CNR-30901       Canadian Patent Based On CNR-309

        Can. Pat. No.   2,026,871       Granted         Aug. 17, 1993

        CNR-309A        METHOD OF MAKING INTEGRATED MAGNETIC READ/WRITE
                        HEAD/FLEXURE/CONDUCTOR STRUCTURE

        U.S. Pat. No.   5,073,242       Granted         Dec. 17, 1991
        Inventor        Hamilton        Filed           Dec. 21, 1990

        CNR-309B        INTEGRATED MAGNETIC READ/WRITE
                        HEAD/FLEXURE/CONDUCTOR STRUCTURE

        U.S. Pat. No.   5,111,351       Granted         May 5, 1992
        Inventor        Hamilton        Filed           June 5, 1990

        CNR-309C        METHOD OF MAKING INTEGRATED MAGNETIC READ/WRITE
                        HEAD/FLEXURE/CONDUCTOR STRUCTURE

        U.S. Pat. No.   5,163,218       Granted         Nov. 17, 1992
        Inventor        Hamilton        Filed           June 11, 1991
<PAGE>   16
CONFIDENTIAL

                                CENSTOR PATENTS

ISSUED PATENTS CONT'D

        CNR-309C1       Canadian Patent Based On CNR-309C

        Can. Pat. No.   2,047,563        Granted         Aug. 17, 1993

        CNR-309D        METHOD OF MAKING INTEGRATED MAGNETIC READ/WRITE
                        HEAD/FLEXURE/CONDUCTOR STRUCTURE

        U.S. Pat. No.   5,174,012        Granted         Dec. 29, 1992
        Inventor        Hamilton         Filed           Dec. 12, 1991

        CNR-310         MICRO-BURNISHING FLEX HEAD STRUCTURE

        U.S. Pat. No.   5,063,712        Granted         Nov. 12, 1991
        Inventors       Hamilton et al. Filed            April 2, 1990
         
        CNR-31001       Canadian Patent Based On CNR-310
        
        Can. Pat. No.   2,026,694        Granted         July 26, 1994

        CNR-31003       Japanese Patent Based On CNR-310

        Jap. Pat. No.   1,945,281        Granted         June 23, 1995

        CNR-313A        UNITARY MICRO-FLEXURE STRUCTURE AND METHOD OF MAKING
                        SAME

        U.S. Pat. No.   5,453,315        Granted         Sept. 26, 1995
        Inventors       Hamilton et al.  Filed           Dec. 14, 1992

        CNR-313CA       UNITARY MICRO-FLEXURE STRUCTURE AND METHOD OF MAKING
                        SAME    

        U.S. Pat. No.   5,483,025        Granted         Jan. 9, 1996
        Inventors       Hamilton et al.  Filed           Dec. 14, 1992

        CNR-313D        UNITARY MICRO-FLEXURE STRUCTURE AND METHOD OF MAKING
                        SAME

        U.S. Pat. No.   5,476,131        Granted         Dec. 19, 1995
        Inventors       Hamilton et al.  Filed           Dec. 14, 1992
       


        



        
<PAGE>   17

CONFIDENTIAL


                                CENSTOR PATENTS

ISSUED PATENTS CONT'D

        CNR-322         GIMBALED MICRO-HEAD/FLEXURE/CONDUCTOR ASSEMBLY AND
                        SYSTEM

        U.S. Pat. No.   5,490,027          Granted      Feb. 6, 1996
        Inventors       Hamilton et al.    Filed        Oct. 28, 1991

        CNR-324         COMPACT, HIGH-SPEED, ROTARY ACTUATOR AND TRANSDUCER
                        ASSEMBLY WITH REDUCED MOMENT OF INERTIA AND MASS-
                        BALANCED STRUCTURAL OVERLAP WITH DRIVE MOTOR AND
                        ORGANIZING METHOD FOR THE SAME

        U.S. Pat. No.   5,396,388          Granted      March 7, 1995
        Inventor        Stanley Brown      Filed        April 8, 1992


PENDING PATENTS

        CNR-321A        Rigid disk drive with small effective mass head, gimbal.
                        Continuation-In-Part of CNR-321, which was filed
                        Nov. 6, 1991.

        CNR-322A        Continuation-in-Part of CNR-322. Rigid disk drive with
                        small effective mass head, gimbal. Recently received
                        Indication of Allowance of numerous claims and filed
                        brief responsive amendment designed for quick
                        Allowance of those claims.

        CNR-324A        COMPACT, HIGH-SPEED, ROTARY ACTUATOR, AND TRANSDUCER
                        ASSEMBLY WITH REDUCED MOMENT OF INERTIA AND MASS-
                        BALANCED STRUCTURAL OVERLAP WITH DRIVE MOTOR AND
                        ORGANIZING METHOD FOR THE SAME

        CNR-329         TRANSDUCER/FLEXURE/CONDUCTOR STRUCTURE FOR
                        ELECTROMAGNETIC READ/WRITE SYSTEM. Filed Nov. 14, 1994.

        CNR-335         CONTACT INTERFACE, SYSTEM AND MEDIUM IN
                        ELECTROMAGNETIC, READ/WRITE, RIGID RECORDING MEDIA
                        ENVIRONMENT. Filed March 21, 1995.


<PAGE>   18

CONFIDENTIAL



                                CENSTOR PATENTS

PENDING PATENTS CONT'D


        CNR-345         INTERACTIVE SYSTEM FOR LAPPING TRANSDUCERS.
                        Filed May 26, 1995.

        CNR-348         LOW FRICTION SLIDING HARD DISK DRIVE SYSTEM.
                        Filed August 15, 1995.

        CNR-349         CONTACT PLANAR RING HEAD. Filed September 15, 1995.

        CNR-350         RING HEAD SLIDING ON PERPENDICULAR MEDIA.
                        Filed December 22, 1995.

        CNR-347         CONTACT HARD DISK DRIVE SYSTEM HAVING A FLEXURE
                        ORIENTED ALONG THE DIRECTION OF SLIDING.
                        Filed March 25, 1996.


<PAGE>   19


                       SCHEDULE 3.1 TO LICENSE AGREEMENT
                        BETWEEN CENSTOR CORPORATION AND
                          READ-RITE CORPORATION, DATED
                                 July 18, 1996
                                 -------------


1.  IBM patents with an effective filing date prior to September 1, 1991.

2.  Censtor's "best knowledge" under Sections 3.1(ii) and (iii) does not
    include a detailed review of the copies of all third party patents
    within Censtor's possession.


<PAGE>   20


operation of law its obligations under this Agreement (provided that any such
assignment which imposes a withholding tax or similar burden shall require the
prior written consent of the other party). This Agreement shall be binding upon
and inure to the benefit of the respective successors and permitted assigns of
the parties.

        9.5  Authority.  Each party represents that all corporate action
necessary for the authorization, execution and delivery of this Agreement by
such party and the performance of its obligations hereunder has been taken.

        9.6  Notices.  All notices and other communications required or
permitted hereunder shall be in writing and shall be deemed effective when
mailed by registered or certified mail, postage prepaid, or otherwise delivered
by hand, by messenger or by telecommunication, addressed to the addresses first
set forth above or at such other address furnished with a notice in the manner
set forth herein. Such notices shall be deemed to have been served when
delivered or, if delivery is not accomplished by reason of some fault of the
addressee, when tendered.

        9.7  Force Majeure.  Neither party shall be liable to the other for
failure or delay in the performance of any obligations under this Agreement for
the time of and to the extent such failure or delay is caused by riots, civil
commotion, wars or hostilities between nations, governmental laws, orders, or
regulations, embargoes, actions by the government or any agency thereof, acts
of God, earthquakes, storms, fires, accidents, strikes, sabotages, explosives,
or other similar or different contingencies beyond the reasonable control of
the parties.

        9.8  Partial Invalidity.  If any provision in this Agreement is held to
be invalid or unenforceable in any jurisdiction in which this Agreement is
being performed, the remainder of this Agreement shall be valid and enforceable
and the parties shall negotiate, in good faith, a substitute, valid and
enforceable provision which most nearly effects the parties' intent in entering
into this Agrement.

        9.9  Counterparts.  This Agreement may be executed in two (2)
counterparts all of which, taken together, shall be regarded as one and the
same instrument.

        9.10 Relationship of Parties.  The parties are independent contractors.
Nothing in this Agreement shall constitute either party the agent of the other
party for any purpose or in any sense whatsoever, or constitute the parties as
partners or joint venturers.

        9.11 Modification.  This Agreement may be modified or amended only by a
written agreement signed by each party.

        9.12 Waiver.  The failure of either party to enforce at any time the
provisions of this Agreement, or the failure to require at any time performance
by the other party of any of provisions of this Agreement, shall in no way be
constituted to be a present or future waiver of such provisions, nor in any way
affect the validity of either party to enforce each and every provision
thereafter. The express waiver by either party of any provision, condition or 


                                      11
<PAGE>   21
requirement of this Agreement shall not constitute a waiver of any future
obligation to comply with such provision, condition or requirement.

        9.13    Entire Agreement. The terms and conditions herein constitute the
entire agreement between the parties and supersede all previous agreements and
understandings, whether oral or written, between the parties hereto with
respect to the subject matter hereof and no agreement or understanding varying
or extending the same shall be binding upon either party unless in a written
document signed by the party to be bound.

        9.14    Section Headings and Language. The section headings contained
in this Agreement are for reference purposes only and shall not affect in any
way the meaning or interpretation of this Agreement.

        9.15    Construction. Each party acknowledges and agrees that this
Agreement has been the result of arms' length negotiation by the parties and
their respective counsel, with each party participating in the preparation
hereof. As a consequence, there shall be no presumption that the provisions
hereof are to be construed for or against either party on the basis of the
relative participation of the parties in the drafting of this Agreement.

        IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered effective as of the date first written above.

Censtor Corp.                           Western Digital Corporation

By: /s/ Russell M. Krapf                By: /s/ Timothy Leyden
    -----------------------------           -----------------------------

Name:   Russell M. Krapf               Name:    Timothy Leyden 
      ---------------------------             ---------------------------

Title:  President CEO                  Title:  Vice President, Finance
                                               Personal Storage Group
       --------------------------             ---------------------------



                                       12
<PAGE>   22
requirement of this Agreement shall not constitute a waiver of any future
obligation to comply with such provision, condition or requirement.

        9.13    Entire Agreement. The terms and conditions herein constitute the
entire agreement between the parties and supersede all previous agreements and
understandings, whether oral or written, between the parties hereto with
respect to the subject matter hereof and no agreement or understanding varying
or extending the same shall be binding upon either party unless in a written
document signed by the party to be bound.

        9.14    Section Headings and Language. The section headings contained
in this Agreement are for reference purposes only and shall not affect in any
way the meaning or interpretation of this Agreement.

        9.15    Construction. Each party acknowledges and agrees that this
Agreement has been the result of arms' length negotiation by the parties and
their respective counsel, with each party participating in the preparation
hereof. As a consequence, there shall be no presumption that the provisions
hereof are to be construed for or against either party on the basis of the
relative participation of the parties in the drafting of this Agreement.

        IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered effective as of the date first written above.

Censtor Corp.                           Western Digital Corporation

By:                                     By: /s/ Timothy Leyden
    -----------------------------           -----------------------------

Name:                                  Name:    Timothy Leyden
      ---------------------------             ---------------------------

Title:                                 Title:   Vice President, Finance
       --------------------------             ---------------------------
                                                Personal Storage Group


                                       12