Exhibit 10.1

                             FORM OF

               AMENDED AND RESTATED PROMISSORY NOTE

                                 
U.S. $_____________                            September 22, 1998


     THIS AMENDED AND RESTATED PROMISSORY NOTE amends, restates
and renews the indebtedness evidenced by that certain Promissory
Note dated March 5, 1998, in the principal amount of
$____________, the original of which is attached hereto and
marked "cancelled".  This Amended and Restated Promissory Note
shall hereafter evidence the obligations of the Maker (as
hereafter defined) to Payee (as hereafter defined) with respect
to the indebtedness of the attached note now evidenced by this
Amended and Restated Promissory Note.

     FOR VALUE RECEIVED, the undersigned nSTOR TECHNOLOGIES,
INC., a Delaware corporation with its principal place of business
at 100 Century Boulevard, West Palm Beach, Florida 33417; Fax:
(561) 640-3160 (hereinafter called "Maker") hereby promises to
pay to the order of ______________________________________ 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
________________________U.S. Dollars (U.S. $____________) (the
"Principal Amount"), plus interest on the outstanding balance of
the Principal Amount at the rate of ten percent (10%) per annum,
payable monthly, 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 September 5, 2000.

     This note evidences an obligation under, and pursuant to the
terms of, a Loan Agreement, dated of even date herewith (the
"Loan Agreement"), between Payee and Maker.  This note is secured
by that certain Amended and Restated Security Agreement, dated of
even date herewith (the "Security Agreement") between Maker,
Payee and certain other parties.

     Each of the following shall constitute an event of default
("Event of Default") hereunder:  (i) failure by Maker to pay the
Principal Amount plus all accrued interest thereon in full on or
before the date when due hereunder, (ii) occurrence of an "Event
of Default" under the Loan Agreement (an "Event of Default" as
defined therein), or (iii) occurrence of an "Event of
Default" under the Security Agreement (an "Event of Default" as
defined therein). 

     Upon the occurrence of an Event of Default 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, the Loan Agreement, the
Security Agreement, and applicable law.

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

     Payment of this Note is subject to all of the terms and
conditions of the Loan Agreement.

     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/ Michael L. Wise            
                              ___________________________
                              Name: Michael L. Wise
                              Title:  Vice President



Exhibit 10.2

                        SECURITY AGREEMENT

          This SECURITY AGREEMENT ("Agreement") is made and
entered into as of this 31st day of July, 1998, by nSTOR
TECHNOLOGIES, INC., a Delaware corporation, with its
principal place of business at 100 Century Boulevard, West Palm
Beach, Florida 33417 ("Debtor") in favor of H. Irwin Levy, an
individual resident of the State of Florida ("Secured Party"),
with a business address at 100 Century Boulevard, West Palm
Beach, Florida 33417.

                           WITNESSETH:

     WHEREAS, Secured Party has entered into a Loan Agreement of
even date herewith with Debtor (the "Loan Agreement"); 

     WHEREAS, pursuant to the Loan Agreement, as security for
payment of the indebtedness due thereunder and under the
Promissory Note of even date therewith delivered pursuant to the
Loan Agreement (the "Note"), and in consideration of the
financial accommodations and agreements therein contained, Debtor
agreed to grant to Secured Party a lien and security interest in
all assets now owned or hereafter acquired by Debtor;

          NOW, THEREFORE, in consideration of the foregoing,
Debtor and Secured Party hereby agree as follows:


          I.   Definitions.  When used herein, the following
capitalized defined terms shall have the following respective
meanings:

          "Account Debtor" shall mean the party obligated on or
under any Account Receivable.

          "Account Receivable" shall mean (a) any present or
future right of the Debtor to receive and collect payment for
goods or services now or hereafter rendered, to an Account
Debtor, (b) all present and future chattel paper and instruments
acquired by the Debtor drawn, made, issued or otherwise created
in connection with any transaction giving rise to an Account
Receivable and any proceeds thereof, (c) all present and future
rights of the Debtor to proceeds of any insurance, indemnity,
warranty or guaranty with respect to any goods sold or leased or
services rendered in a transaction giving rise to an Account
Receivable, (d) all present and future rights of the Debtor to
claim for damages arising out of a breach of or default under any
contract, to terminate any contract giving rise to any Account
Receivable, to perform thereunder and to compel performance and
otherwise exercise all remedies thereunder, (e) all goods in the
Debtor's possession or held for the Debtor's account the sale or
lease of which shall have given rise to an Account Receivable and
the proceeds of any resale or subsequent lease thereof, and (f)
all present and future rights of Debtor to receive cash, property
or other distributions from any partnership arising out of or in
connection with Debtor's interest as a limited or general partner
in such partnership.

          "Chattel Paper" shall mean all of Debtor's now owned or
hereafter acquired chattel paper, such term having the broadest
meaning attributable to it under the Uniform Commercial Code
in force in the state of Florida (hereinafter the "Uniform
Commercial Code"). 

          "Collateral" shall mean all right, title and interest
of the Debtor in and to (i) any Account Receivable, (ii) all
Inventory, (iii) all Equipment, (iv) all Fixtures, (v) all
Personal Property, (vi) all Chattel Paper, (vii) all General
Intangibles, (viii) all Documents, (ix) all Instruments, (x) all
bank accounts, cash, stock and all other assets of any nature or
kind now owned or hereafter acquired by Debtor, and all interest
of Debtor in any of the foregoing, together with (xi) all
additions to, substitutions for and all proceeds, products and
accessions of any and all property described and designated as
(i) through (x) above and all proceeds, monies, income, products
and benefits attributable or accruing to any of the foregoing
property and which Debtor is or may hereafter become entitled to
receive on account of said property.

          "Default" shall mean the occurrence of any one or more
of the following events: (a) the Debtor's failure to pay, when
due, any amount payable in respect of all or any portion of the
Indebtedness; (b) the loss, theft, destruction or encumbrance of,
or substantial damage to, the Collateral or any portion thereof
or the making of any levy, seizure or attachment thereof or
therein; (c) the Debtor's failure to refusal to perform, or
breach or violation of any of the terms, covenants,
representations or warranties of, or occurrence of any event of
default under this Agreement, the Loan Agreement, the Note or any
other instrument, document or agreement evidencing, securing or
relating to any portion of the Indebtedness; (d) the Debtor's
failure to pay debts as and when due and payable, or the making
of any assignment by Debtor for the benefit of creditors; (e) the
commencement of any proceedings by or against Debtor under any
insolvency, bankruptcy or other debtor relief laws in any
jurisdiction, including without limitation any such proceedings
seeking the liquidation, arrangement, or reorganization of the
Debtor under any bankruptcy or insolvency procedure, or any
formal or informal proceeding for the liquidation, dissolution or
settlement of claims by or against the Debtor; (f) any
application for the appointment of a receiver for the assets
of Debtor, (g) the entry of a judgment against the Debtor or (h)
the occurrence of an Event of Default under the Loan Agreement or
the Note (as Event of Default is defined therein).

          "Documents" shall mean all documents now owned or
hereafter acquired by Debtor, such term having the broadest
meaning attributable to it under the Uniform Commercial Code or
other applicable law.

          "Fixtures" shall mean all goods, chattels, fixtures,
equipment and all personal property affixed or in any manner
attached to any land and/or building(s) or structure(s) thereon,
now owned or hereafter acquired by Debtor or in which Debtor now
owns or hereafter acquired any interest, including all additions,
accessions and appurtenances thereto, all replacements and
substitutions therefor, and all proceeds, products and
accessions, thereof, however attached or affixed and wherever
located.  As used herein the term "Fixtures" shall have the
broadest meaning attributable to it under the Uniform Commercial
Code or other applicable law.

          "General Intangibles" shall mean all personal property
other than goods, accounts, chattel paper, documents and
instruments, now owned or hereafter acquired by Debtor, such term
having the broadest meaning attributable to it under the Uniform
Commercial Code or other applicable law, and including without
limitation all things in action, all contract rights,
subscription rights and all rights and interests of any nature or
kind now owned or hereafter acquired by Debtor in any
partnership, venture or other business association or entity.

          "Indebtedness" shall mean (a) all liabilities and
obligations of Debtor to Secured Party arising under or pursuant
to the Loan Agreement, the Note or this Agreement, (b) all
renewals, extensions, increases, modifications and/or
rearrangements or reschedulings of any or all of the
foregoing referenced liabilities and obligations and of any part
thereof, and any substitutions of the same, to which the Secured
Party may hereafter agree in writing, and (c) all costs, expenses
and attorneys' fees and legal expenses which may be paid or
incurred by the Secured Party in connection with (x) enforcing
payment by Debtor of the Indebtedness, (y) enforcing its security
interest hereunder, or (z) protecting, preserving, handling,
dealing with, selling or otherwise disposing of or realizing upon
the Collateral or its security interest therein.

          "Instruments" shall mean all instruments now owned or
hereafter acquired by Debtor, such term having the broadest
meaning attributable to it under the Uniform Commercial Code or
other applicable law.

          "Inventory" shall mean all goods now or hereafter (a)
held by Debtor for sale or lease, (b) furnished or to be
furnished by Debtor to a third party under any contract of
service, (c) held by Debtor as raw materials or work in process
or (d) used or consumed by Debtor in the ordinary course of
business.

          "Personal Property" shall mean all goods and all
personal property of any nature or description, wherever located,
now owned or hereafter acquired by Debtor, together with all
additions or appurtenances thereto, all substitutions therefor,
and all proceeds, products and accessions thereof.  As used
herein the term "goods" shall have the broadest meaning
attributable to it under the Uniform Commercial Code or other
applicable law.

          1.   Grant of Security Interest.  As security for the
payment of the Indebtedness, the Debtor hereby grants, pledges
and assigns to the Secured Party a continuing security interest
in the Collateral.

          2.   Perfection of Security Interest.  

               (a)  Financing Statements and Other Actions.  The
Debtor hereby authorizes the Secured Party to file one or more
financing or continuation statements, and amendments thereto,
relating to all or any part of the Collateral, without the
signature of the Debtor where permitted by applicable law, and
agrees itself to take all such other actions and to execute and
deliver and file or cause to be filed such financing statements,
continuation statements, and other documents, as the Secured
Party may reasonably require in order to establish and maintain a
perfected, valid and continuing security interest of the Secured
Party in the Collateral.

               (b)  Delivery.  The Debtor agrees immediately to
deliver to the Secured Party, appropriately endorsed to the order
of the Secured Party, any Document or Instrument of which the
Debtor is or becomes owner or holder. 

          3.   Records; Information.  The Debtor agrees to keep
at its principal place of business, as shown in the opening
paragraph of this Agreement, its records concerning the
Collateral, which records shall be sufficiently accurate to
enable the Secured Party or its designee to determine
at any time the status thereof.  The Debtor agrees promptly to
furnish to the Secured Party such information concerning the
Debtor, the Collateral and any Account Debtor as the Secured
Party may reasonably request.

          4.   Representations and Warranties of the Debtor.  The
Debtor represents and warrants that: (a) it is a corporation duly
organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation and is qualified to
do business in all such jurisdictions in which it is doing
business, (b) the execution, delivery and performance of this
Agreement and the above pledge and assignment and grant of a
security interest in the Collateral to the Secured Party
have been duly authorized and are not contrary to or in violation
of law, any order of a court or government agency, the Debtor's
certificate of incorporation or by-laws, or any other agreement,
instrument, or other document to which the Debtor is a party or
by which the Debtor or any of its assets may be bound, (c) this
Agreement is the legal, valid and binding obligation of the
Debtor and, subject to the making of any filings required
pursuant to Section 3(a) hereof and the delivery of any
Collateral to the Secured Party pursuant to Section 3(b) hereof,
creates a valid, enforceable and perfected security interest in
the Collateral, first and prior to any or all other liens,
claims, encumbrances or security interests except for the
Permitted Liens and the Pari Passu Liens (as such terms are
defined in the Loan Agreement), and the Debtor is duly authorized
to make all filings and take all other actions necessary or
desirable to perfect and to continue perfected such security
interest, (d) all of the Debtor's right, title and interest in
and to the Collateral is free and clear of all liens, claims,
charges, pledges, security interests and encumbrances, except for
the security interests granted to the Secured Party herein, the
Permitted Liens and the Pari Passu Liens (as such terms are
defined in the Loan Agreement), and (e) no consent of any person
or entity is required, except such as have been obtained in
writing by Debtor and delivered to Secured Party, in order to
render this Agreement, the Loan Agreement and the Note fully
enforceable against the Debtor in accordance with their terms or
to prevent the execution and delivery of this Agreement, the Loan
Agreement and the Note from violating the terms of or giving rise
to a default or event of default under any other agreement,
instrument or document to which the Debtor is a party or by which
the Debtor or any of its assets are bound.

          5.   Covenants.

               (a)  Affirmative Covenants.  The Debtor shall (i)
perform and observe all the terms and provisions of any agreement
for the rendering of services or any other agreement, giving rise
to an Account Receivable to be performed or observed by it,
maintain any such agreement in full force and effect, enforce any
such agreement in accordance with its terms, and take all such
action to such and as may be from time to time requested by the
Secured Party; (ii) at the Debtor's expense, furnish to the
Secured Party promptly upon receipt thereof copies of all
notices, requests and other documents received by the Debtor in
connection with any Account Receivable, and from time to time (x)
furnish to the Secured Party such information and reports
regarding any Account Receivable as the Secured Party may
reasonably request, and (y) upon request of the Secured Party,
make to any Account Debtor such demand and request for
information and reports or for such action as the Debtor may be
entitled to make in connection with any Account Receivable; (iii)
at the Debtor's expense, take such action as the Debtor or the
Secured Party may deem necessary or advisable to enforce
collection of amounts due or to become due in respect of any
Account Receivable; (iv) take out and maintain in effect such
policies of insurance covering the Collateral as the Secured
Party may reasonably require; and (v) maintain and preserve the
Collateral in good condition and take all such action to such end
as may be from time to time requested by the Secured Party.

               (b)  Negative Covenants.  The Debtor shall not
without the prior written consent of the Secured Party (i) sell,
assign or otherwise dispose of the Collateral, or (ii) create or
suffer to exist any security interest, financing statement, lien
or other encumbrances upon or with respect to the Collateral to
secure indebtedness of any person or entity, except for the
security interest granted to the Secured Party hereunder and the
Permitted Liens (as defined in the Loan Agreement).

          6.   Rights of the Secured Party upon Default.  On and
after the occurrence of a Default by the Debtor, all the
Indebtedness shall, at the option of the Secured Party, become
immediately due and payable, without notice or demand.  The
Secured Party may (a) enforce collection of any of the Collateral
by suit or any other lawful means available to the Secured Party,
(b) surrender, release or exchange all or any part of the
Collateral, or compromise or extend or renew for any period any
indebtedness thereunder or evidenced thereby, (c) assert all
other rights of a secured party under the Uniform Commercial Code
or other applicable law, including, without limitation, the right
to take possession of, hold, collect, sell, lease or otherwise
retain, liquidate or dispose of all or any portion of the
Collateral.  The proceeds of any collection, liquidation or other
disposition of the Collateral shall be applied by the Secured
Party first to the payment of all expenses (including without
limitation, all fees, taxes, reasonable attorney's fees and legal
expenses) incurred by the Secured Party in connection with
retaking, holding, collecting, or liquidating the Collateral. 
The balance of such proceeds, if any, shall, to the extent
permitted by law, be applied to the payment of the Indebtedness
in such order of application as the Secured Party may, in its
sole discretion, elect.  In case of any deficiency, the Debtor
shall, whether or not then due, remain liable therefor. 
In addition to the foregoing, the Secured Party shall be entitled
to exercise any and all other rights and remedies provided to
Secured Party under this Agreement, the Loan Agreement, the Note,
and applicable law and equity.

          7.   The Secured Party' Duties and Right to Perform. 
The powers conferred on the Secured Party hereunder are solely to
protect the Secured Party' interest in the Collateral and
shall not impose any duty upon it to exercise any such powers. 
The Secured Party shall have no duty as to the Collateral or as
to the taking of any necessary steps to preserve rights against
prior parties or any other rights pertaining to the Collateral. 
If the Debtor fails to perform any of its obligations hereunder,
or under any agreement giving use to or in connection with any
Account Receivable, the Secured Party may themselves perform, or
cause the performance of, such agreement, and the expenses of the
Secured Party incurred in connection therewith shall be payable
by the Debtor.

          8.   Indemnity and Expenses.  The Debtor agrees to
indemnify the Secured Party from and against any and all claims,
losses and liabilities arising out of or connected with this
Agreement (including, without limitation, enforcement of this
Agreement), except claims, losses or liabilities resulting solely
from the Secured Party' gross negligence or wilful misconduct.

          9.   Security Interest Absolute.  All rights of the
Secured Party hereunder, and all obligations of the Debtor
hereunder, shall be absolute and unconditional, irrespective of:

               (a)  any lack of validity or enforceability of the
Indebtedness or any agreement or instrument contemplated thereby;

               (b)  any change in the time, manner or place of
payment of, or in any other term of, all or any of the
Indebtedness, or any other amendment or waiver of or any consent
to any departure from the terms of the Indebtedness or any other
agreements contemplated thereby;

               (c)  any exchange, release or non-perfection of
any other security interest, or any release or amendment or
waiver of or consent to departure from any guaranty, for all or
any of the Indebtedness; or

               (d)  any other circumstance (other than payment in
full) which might otherwise constitute a defense available to, or
a discharge of, the Debtor in respect of the Indebtedness or in
respect of this Agreement.

          10.  Cumulative Security.  Neither the execution and
delivery of this Agreement nor the taking hereafter of any
security for payment of the Indebtedness shall in any manner
impair or affect any other security for payment of the
Indebtedness.  All such present and future additional
security is to be considered as cumulative security.

          11.  Continuing Agreement.  This is a continuing
agreement and the grant of a security interest hereunder shall
remain in full force and effect and all the rights, powers and
remedies of Secured Party hereunder shall continue to exist until
the Indebtedness is paid in full as the same becomes due and
payable and until Secured Party, upon request of Debtor, has
executed a written termination statement, reassigned to Debtor
without recourse the Collateral and all rights conveyed hereby,
and returned possession of the Collateral to Debtor.

          12.  Notices.  All notices, requests and other
communications to either party hereunder shall be in writing and
shall be given to such party at its address or telefax number set
forth at the beginning of this Agreement or such other address or
telefax number of which such party may hereafter give notice to
the other.  Each such notice, request or other communication
shall be effective (i) if given by telefax, upon transmission
with a machine-generated transmittal confirmation, (ii) if given
by mail, 72 hours after such communication is deposited in the
United States mails with first class postage prepaid, addressed
as aforesaid, or (iii) if given by any other means, when
delivered at the address specified in this Section.

          13.  Remedy and Waiver.  Secured Party may remedy any
Default without waiving the Default rendered, and may waive any
Default without waiving any prior or subsequent Default. 
No failure or delay by the Secured Party in the exercise of any
right or remedy under this Agreement or under the Uniform
Commercial Code or any applicable law shall operate as a waiver
hereunder or thereunder, and no partial exercise by the Secured
Party of any right or remedy of the Secured Party hereunder or
thereunder shall preclude the further exercise by the Secured
Party of any other right or remedy hereunder or thereunder.

          14.  Governing Law.  This Agreement shall be governed
by and construed in accordance with the laws of the State of
Florida.

          15.  Successors and Assigns.  The rights and
obligations of the parties hereto shall be binding on and shall
inure to the benefit of their successors and assigns, except that
in accordance with Section 6 of this Agreement, the rights and
obligations hereunder may not be assigned by Debtor.

          16.  Modification.  This agreement or any provision
hereof may be modified or amended only by a written agreement
signed by both parties hereto.

          18.  Counterparts.  This Agreement may be executed in
one or more counterparts, each of which shall be deemed an
original, but all of which taken together shall constitute one
and the same instrument.     

          IN WITNESS WHEREOF, this Agreement has been duly
executed as of the day and year first above written.

                           DEBTOR

                           nSTOR TECHNOLOGIES, INC.

                                  /s/ Mark F. Levy
                           By: ___________________________        

                                    Mark F. Levy      
                           Name:__________________________
                           Title:   Vice President


                           Secured Party

                               /s/ H. Irwin Levy
                           ________________________________       
                           H. Irwin Levy





Exhibit 10.3

                          LOAN AGREEMENT

     This Loan Agreement (the "Agreement") is made as of the 31st
day of July, 1998 by and between nSTOR TECHNOLOGIES, INC. a
Delaware corporation, with its principal place of business at 100
Century Boulevard, West Palm Beach, Florida 33417; Fax: (561)
640-3160 (the "Borrower") and H. Irwin Levy, an individual
resident of the State of Florida, with a business address at 100
Century Boulevard, West Palm Beach, Florida 33417; Fax: (561)
640-3160 (the "Lender").

     In consideration of the mutual covenants contained herein
and other good and valual consideration, the receipt and
sufficiency of which are hereby acknoledged, Lender and Borrower
agree as follows:

     1.   Loan and Note. 

          (a)  Subject to the terms and conditions of this
Agreement, Lender agrees to lend to Borrower, the principal
amount of ONE MILLION FIVE HUNDRED THOUSAND Dollars
($1,500,000.00) (the "Maximum Loan Amount"), as may be amended,
renewed, increased, restated, replaced, or otherwise modified
from time to time (the "Loan").  The Loan shall be evidenced by
a promissory note of Borrower payable to order of Lender of even
date herewith, in the form attached hereto and incorporated
herein as Exhibit "A", as may be amended, renewed, increased,
restated, replaced, or otherwise modified from time to time (the
"Note"), and shall bear interest at the rate and be subject to
such repayment and other terms as set forth therein and herein. 
The outstanding balance of the Loan may increase and decrease
from time to time, and Advances thereunder may be repaid and
reborrowed, but the total of Advances outstanding at any one time
under the Revolving Loan shall never exceed the Maximum Loan
Amount.

          (b)  The proceeds of the Loan are to be used by the
Borrower solely as working capital in the ordinary course of
Borrower's business.

     2.   Collateral Security.  The Borrower's obligations under
this Agreement and the Note shall be secured by a security
interest (the "Security Interest") in all assets of the Borrower
pursuant to a security agreement of even date herewith, in the
form attached hereto as Exhibit B (the "Security Agreement"). 
The security interest granted to Lender pursuant to the Security
Agreement shall be (i) subordinated to (A) the security interest
in favor of Finova Capital Corporation (the "Finova Security
Interest") as evidenced by the loan or credit agreement in effect
between Finova Capital Corporation and the nStor Corporation,
Inc. as of the date hereof and the UCC-1 Financing Statement
relating thereto filed of record with the Secretary of State of
the State of Florida as of the date hereof, (B) the security
interests granted under other "Senior Indebtedness" (as
hereinafter defined) (the "Senior Indebtedness Security
Interest"); and (ii) pari passu with (A) all security
interests granted or granted hereafter to H. Irwin Levy, and (B)
the security interests granted to other lenders as of the date
hereof (the "Pari Passu Liens").  The Finova Security Interest,
the Senior Indebtedness Security Interest, and the Pari Passu
Liens are collectively referred to hereinafter as the "Permitted
Liens").  The Borrower shall execute and deliver and cause to be
executed and delivered such further instruments and documents,
including without limitation UCC-1 Financing Statements, as shall
be reasonably necessary and proper to effectuate the granting and
perfection of the Security Interest.

     3.   Subordination.  The Lender shall execute and deliver
such further instruments and documents as shall be reasonably
necessary and proper to reflect the subordination of the Security
Interest to the Permitted Liens.  For purposes of this Agreement,
Senior Indebtedness shall mean all indebtedness, obligations and
liabilities of Borrower to banks and other financial institutions
now existing or hereafter arising.

     4.   Loan Documents.  This Agreement, the Note, the Security
Agreement, as the same may be amended, renewed, increased,
restated, replaced, or otherwise modified from time to time,
together with such financing statements, subordination
agreements, and other instruments and documents as shall be
delivered in connection therewith shall be referred to
collectively herein as the "Loan Documents".

     5.   Covenants of Borrower.

          Borrower hereby covenants and agrees with Lender as
follows:

          (a)  To duly and punctually perform, observe and comply
with all of the terms, provisions, conditions, covenants and
agreements on its part to be performed, observed and complied
with hereunder and under the Loan Documents.  Borrower will not
suffer or permit any Event of Default (as hereinafter defined) to
exist hereunder or thereunder. Borrower will promptly give notice
in writing to Lender of the occurrence of any event or
circumstance materially affecting in an adverse manner Borrower's
ability to repay the Loan. 

          (b)  The Borrower shall not use the proceeds of the
Loan for any purpose other than the permitted purposes set forth
in Section 1(b) of this Agreement.

     6.   Representations and Warranties of Borrower.  As a
condition to and as an inducement to the Lender to make the Loan
hereunder, Borrower hereby represents, warrants and certifies to
the Lender that as of the date hereof, for so long as any portion
of the Loan, or any accrued interest thereon, is outstanding and
not paid to Lender in full and for so long as any of Borrower's
obligations under any of the Loan Documents have not been
satisfied, each of the following statements is and will remain
true and correct in all respects:

          (a)  The execution and delivery of the Loan Documents,
and the performance by the Borrower of its obligations
thereunder, will not be in conflict with, or constitute (with or
without the passage of time or giving of notice) a breach or
default under, or require any consent or waiver (other than any
consents or waivers that have been obtained), or result in the
creation of any mortgage, pledge, lien, encumbrance or charge
upon the assets of the Borrower under (i) any provision of the
articles of incorporation or bylaws of the Borrower as in effect
on the date hereof, (ii) any instrument, mortgage, deed of trust,
contract or agreement to which the Borrower is a party
or by which it is bound, or (iii) any judgment, decree or order
of a court, tribunal or governmental authority by which the
Borrower is bound.

          (b)  Each of the Loan Documents to which Borrower is a
party has been duly authorized and validly executed by the
Borrower pursuant to all requisite corporate action of the
Borrower, and is and will remain the duly valid and binding
obligation of the Borrower, enforceable against the Borrower in
accordance with its terms.

          (c)  Neither the Borrower nor any of its properties or
assets are bound by, subject to or affected by any note,
indebtedness, bond, mortgage, lien, indenture, deed of trust, or
other similar instrument or obligation other than:  (i) those
established pursuant to the Loan Documents, (ii) those underlying
or those which may hereafter be established as and underlying the
Permitted Liens or the Pari Passu Liens, and (iii) debt incurred
in the ordinary course of business of the Borrower.

          (d)  Neither the Borrower nor any of its properties or
assets are subject to any order, writ, injunction, directive or
decrees or statute, rule or regulation not applicable to Florida
corporations generally.

          (e)  No authorizations, approvals, consents of, and no
filings or registrations with, any governmental or regulatory
authority or agency are necessary for the execution, delivery or
performance by the Borrower of any of the Loan Documents to which
it is a party or for the validity or enforceability thereof,
except for the filings and recordings of UCC-1 Financing
Statements pursuant to the Loan Documents.

          (f)  Except as set forth on Schedule A attached hereto,
there are no actions, suits, proceedings or investigations
pending or threatened, including without limitation, actions,
suits or proceedings relating to product or service liability
claims, against or affecting the Borrower or any of its
properties or business, at law or in equity, or before or by any
federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, domestic or
foreign, whether as plaintiff or defendant, which individually or
in the aggregate could have a material adverse effect on the
properties, operations or financial condition of the Borrower. 
There is no state of facts or contemplated event which may
reasonably be expected to give rise to such claim, action, suit,
proceeding or investigation which could have a material adverse
effect on the properties, operations or financial condition of
the Borrower.  The Borrower is not operating under, or subject
to, or in default with respect to, any judgment, order, writ,
injunction, rule, regulation or decree of any court or federal,
state, municipal or other governmental agency or body, domestic
or foreign.

          (g)  The Borrower i s not in violation of, or default
under (i) any instrument, mortgage, deed of trust, contract or
agreement to which it is a party or by which it is bound, or (ii)
any provision of the articles of incorporation or bylaws of the
Borrower.

          (h)  There are no liens, mortgages, encumbrances,
security interests or rights of third parties with respect to the
Collateral (as defined in the Security Agreement) other than the
Permitted Liens.

          (i)  As of the date hereof, after taking into account
the transactions contemplated by the Loan Documents, the fair
value of the Borrower or any and all property (tangible and
intangible) of the Borrower is greater than the total amount of
liabilities, including any contingent liabilities, of the
Borrower.

          (j)  As of the date hereof, after taking into account
the transactions contemplated by the Loan Documents, the present
fair salable value of the Borrower or of the assets (tangible or
intangible) of the Borrower is not less than the amount that will
be required to pay the probable liabilities of the Borrower on
its existing debts as the debts become absolute and matured.

          (k)  As of the date hereof, after taking into account
the transactions contemplated by the Loan Documents, the Borrower
is able to realize upon its assets (tangible and intangible) and
pay its debts and other liabilities, contingent obligations and
other commitments as they mature in the normal course of
business.

          (l)  The Borrower owns, holds or licenses all material
patents, trademarks, franchises, licenses, permits, rights-of-way
and consents as are required or necessary to own its material
properties and assets and to conduct its businesses as presently
conducted.

          (m)  As of the date hereof, after taking into account
the transactions contemplated by the Loan Documents, the Borrower
does not have an unreasonably small capital, taking into
consideration, among other things, the following:

               (i)   The cash and other current assets of the
Borrower;

               (ii)  The experience of the management in
operating the business and in acquiring and disposing of assets;

               (iii) Contingent liabilities of the Borrower;

               (iv)  The amortization requirements of all
long-term debt and the anticipated interest payable on all debt;
and

               (v)   Customary terms of trade payables in the
business in which the Borrower is engaged.

     7.   Events of Default.  The following events shall
constitute "Events of Default" hereunder:

          (a)  Borrower fails to pay any principal, interest, or
other amount due on any indebtedness owed Lender under the Loan
Documents within ten (10) days after any such amount
becomes due in accordance with the terms thereof or hereof;

          (b)  There occurs an "Event of Default" under the
Security Agreement or under the Note (as "Event of Default" is
defined in those documents respectively) or Borrower fails to
fully and promptly perform any agreement, term, covenant, or
condition of this Agreement, the Note or the Security Agreement;

          (c)  There occurs an event of default under any other
instrument, agreement or document evidencing indebtedness from
the Borrower to any other person or entity;

          (d)  Borrower liquidates or dissolves, Borrower
commences, or consents to or acquiesces in, a voluntary
proceeding in bankruptcy or insolvency; Borrower applies for, or
consents or acquiesces in, the appointment of a receiver for all
or a substantial part of its property; Borrower makes an
assignment for the benefit of creditors; or Borrower is unable to
pay its debts as they mature or admits in writing its inability
to pay it debts as they mature;

          (e)  An involuntary proceeding in bankruptcy or
insolvency is commenced against Borrower; a receiver is
involuntarily appointed for all or a substantial part of the
property of Borrower; or an order is entered for the issuance of
a warrant of attachment, execution, distraint, or similar process
against all or a substantial part of the property of Borrower;
and

          (f)  Any breach of a representation, warranty or
covenant made by Buyer hereunder or if any representation or
warranty made by Buyer hereunder is untrue.

     8.   Remedies of Lender.   Borrower agrees that the
occurrence of such Event of Default shall constitute a default
under each of the Loan Documents, and, other than as provided in
Section F.1 hereof, in the event such Event of Default shall
continue unremedied for a period of thirty (30) days after the
earlier to occur of (i) an officer of Borrower becomes aware of
such default or (ii) notice of such default to the Borrower by
the Lender, Lender shall be entitled to: (1) accelerate and
declare immediately due and payable all indebtedness evidenced by
this Agreement and the Note; (2) exercise any and all of the
various remedies therein provided herein, in the Note, in the
Security Agreement and in any other of the Loan Documents; and


(3) cumulatively exercise all other rights, options and
privileges, and remedies provided by law or in equity.

     9.   Notices.  All notices, requests and other
communications to either party hereunder shall be in writing and
shall be given to such party at its address or telefax number set
forth at the beginning of this Agreement or such other address or
telefax number of which such party may hereafter give notice to
the other.  Each such notice, request or other communication
shall be effective (i) if given by telefax, upon transmission
with a machine-generated transmittal confirmation, (ii) if given
by mail, 72 hours after such communication is deposited in the
United States mails with first class postage prepaid, addressed
as aforesaid, or (iii) if given by any other means, when
delivered at the address specified in this Section.

     10.  Miscellaneous.

          (a)  Whenever in this Agreement one of the parties
hereto is named or referred to, the heirs, legal representatives,
permitted successors and permitted assigns of such party shall be
included, and all covenants and agreements contained in this
Agreement by or on behalf of Borrower or by or on behalf of
Lender shall bind and inure to the benefit of their respective
heirs, legal representatives, permitted successors and permitted
assigns, whether so expressed or not.

          (b)  The headings of the sections, paragraphs and
subdivisions of this Agreement are for the convenience of
reference only, are not to be considered a part hereof and shall
not limit or otherwise affect any of the terms hereof.

          (c)  Neither this Agreement nor any provision hereof
may be changed, waived, discharged or terminated orally, but only
by written instrument signed by the party against whom
enforcement of the change, waiver, discharge or termination is
sought.

          (d)  This Agreement shall be governed in its
enforcement, construction and interpretation by the laws of the
State of Florida, without reference to principles of conflict of
laws.  The exclusive venue for any litigation in connection with
or arising out of this Agreement or the Note shall be Palm Beach
County, Florida.

          (e)  In the event any legal proceedings are instituted
between the parties concerning this Agreement or the Note, the
prevailing party shall be entitled to recover its costs of suit,
including reasonable attorneys' fees, at both trial and appellate
levels from the losing party.






          (f)  BORROWER 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 AGREEMENT, THE NOTE, OR ANY OF THE
OTHER LOAN DOCUMENTS, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
EITHER PARTY.   THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE
LENDER TO ENTER INTO THE LOAN.

          (g)  This Agreement may not be amended or modified
except by a writing signed by both parties hereto.

          (h)  This Agreement, the Note, the Security Agreement
and the other Loan Documents shall constitute the entire
agreement and understanding of the parties hereto with respect
to the subject matter hereof, and there are no other agreements
or understandings, oral or written, that are not merged herein or
superseded hereby.

          (i)  This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all
of which taken together shall constitute one and the same
instrument.


     IN WITNESS WHEREOF, Borrower and Lender have executed this
Agreement as of the date first set forth above.

                           BORROWER

                           nSTOR TECHNOLOGIES, INC.

                                 /s/ Mark F. Levy                 
                           By:___________________________         
              
                           Name:  Mark F. Levy
                 
                           Title: Vice President


                           LENDER

                                  /s/ H. Irwin levy
                           _____________________________
                           H. Irwin Levy










                            SCHEDULE A

1.  Pending Litigation

    Complaint filed in Nassau County, New York involving a claim
for contractual and proprietary interests in the prospect of a
transaction to purchase certain net assets acquired by Borrower.



                           EXHIBIT A


                        Exhibit A omitted   



                           EXHIBIT B


                  (Security Agreement filed as a
                   separate exhibit at exhibit 10.2)