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                                                                  Exhibit 10.121

                             MODIFICATION AGREEMENT

         THIS MODIFICATION AGREEMENT (this "Agreement"), is made as of September
30, 1998, between SPECTRAN  SPECIALITY OPTICS COMPANY,  a Delaware  corporation,
having a place of  business  and a mailing  address at 150 Fisher  Drive,  Avon,
Connecticut  06001  ("Mortgagor")  and  STATE  STREET  BANK  AND  TRUST  COMPANY
(successor to Fleet National Bank, as Trustee),  a  Massachusetts  trust company
having a place of  business  and a  mailing  address  at 2  International  Place
Boston,  Massachusetts  02110,  not  individually but solely as security trustee
under that  certain  Trust  Indenture,  dated as of December 1, 1996,  among the
Mortgagor,  Fleet  National Bank and the other  parties  signatory  thereto,  as
amended by that certain First  Amendment  dated as of September 30, 1998,  among
Mortgagor,  State  Street Bank and Trust  Company (in its  capacity as successor
trustee to Fleet  National  Bank,  as Trustee and together with any successor or
co-security  trustee that becomes such in accordance  with the provisions of the
Trust Indenture,  the "Trustee") and the other parties  signatory  thereto (said
Trust  Indenture,  as so amended and as may  hereafter  be amended,  restated or
otherwise modified from time to time, the "Trust Indenture").

                                 R E C I T A L S

         WHEREAS,  Mortgagor is party to that certain Loan Agreement dated as of
December 1, 1996 (as amended to but  excluding  the date hereof,  the  "Existing
Loan  Agreement"),  among  Mortgagor,  SpecTran  Corporation  (the "Parent"),  a
Delaware  corporation,  SpecTran  Communication Fiber  Technologies,  a Delaware
corporation,   and  Applied  Photonic  Devices,   Inc,  a  Delaware  corporation
(collectively,  the  "Borrowers"),  and Fleet  National Bank (the  "Lender"),  a
national  banking  association,  pursuant to which Lender has extended credit to
Borrowers  pursuant to a revolving line of credit facility (the "Facility"),  as
evidenced by a certain  Revolving Note dated as of December 1, 1996, in the face
amount  of  $20,000,000  (as  amended  to but  excluding  the date  hereof,  the
"Existing Revolving Note");

<PAGE>

         WHEREAS,  Borrowers  and Lender have agreed to enter into that  certain
First  Amendment to Loan  Agreement  dated as of  September  30, 1998, a copy of
which is  attached  hereto as  Schedule  1-a and made a part  hereof  (the "Loan
Agreement  Amendment";  the  Existing  Loan  Agreement  as  amended  by the Loan
Agreement  Amendment and as further amended from time to time, the "Amended Loan
Agreement"),  and that certain  First  Amendment  to Revolving  Note dated as of
September 30, 1998, a copy of which is attached  hereto as Schedule 2-a and made
a part hereof (the "Revolving Note  Amendment";  the Existing  Revolving Note as
amended by the  Revolving  Note  Amendment  and as further  amended from time to
time,  the "Amended  Revolving  Note"),  pursuant to which,  among other things,
Borrowers  and  Lender  have  agreed  to extend  the  maturity  of the  Existing
Revolving  Note from  December 31, 1999,  to April 1, 2000,  and to make certain
other amendments to the Existing Loan Agreement and the Existing Revolving Note,
as more particularly set forth in the Loan Agreement Amendment and the Revolving
Note Amendment, respectively;



<PAGE>


         WHEREAS,  the Parent issued certain 9.24% Series A Senior Secured Notes
due December 26, 2003, in the aggregate  principal  amount of  $16,000,000,  and
certain  9.39% Series B Senior  Secured  Notes due  December  26,  2004,  in the
aggregate  principal  amount of $8,000,000  (collectively,  the  "Existing  Term
Notes")  pursuant to those  certain Note  Purchase  Agreements  each dated as of
December 1, 1996 (as amended to but excluding the date hereof, collectively, the
"Existing  Note  Agreement"),  which  Existing  Term  Notes were  guarantied  by
Mortgagor  pursuant to a certain Guaranty Agreement dated as of December 1, 1996
(as amended from time to time, the "Guaranty Agreement");

         WHEREAS,  all capitalized  terms used herein but not otherwise  defined
herein shall have the meanings ascribed to such terms in the Trust Indenture;

         WHEREAS,  as required by the Existing  Loan  Agreement and the Existing
Note  Agreement,  Mortgagor's  obligations  from  time to time  evidenced  by or
arising in connection with the Existing Revolving Note, the Guaranty  Agreement,
the Trust  Indenture or the other Lending  Documents are secured by that certain
Open-End  Mortgage,  Assignment  of Rents  and  Security  Agreement  dated as of
December  1, 1996,  and  recorded  in the Town Clerk of Avon,  Connecticut  Land
Records,  in Book 327, at page 378 (the  "Existing  Mortgage"  and as amended by
this  Agreement,  the  "Amended  Mortgage"),  encumbering,  among other  things,
certain  real  property  located  in Avon,  Connecticut,  and more  particularly
described in Exhibit A attached thereto; and

         WHEREAS, as a condition of, and as an inducement to, Lender agreeing to
enter  into the Loan  Agreement  Amendment  and the  Revolving  Note  Amendment,
Mortgagor has agreed to amend the Existing Mortgage to reflect the modifications
made to the Existing Loan  Agreement by the Loan  Agreement  Amendment and those
made to the Existing  Revolving Note by the Revolving Note Amendment,  including
the extension of the maturity of the Revolving Note to April 1, 2000;

<PAGE>

                               A G R E E M E N T S

         NOW,  THEREFORE,  in  consideration  of the foregoing  RECITALS and for
other good and valuable consideration received to the mutual satisfaction of the
parties hereto, the undersigned hereby agree as follows:
1.   Modifications to the Existing Mortgage.  The Existing Mortgage is hereby
modified as follows:

                           (a) The first paragraph  following "W I T N E S S E T
                  H" is hereby amended and restated in its entirety as follows:



<PAGE>


                                    AWHEREAS,  Grantor, SpecTran Corporation,  a
                           Delaware  corporation  having an  address  at 50 Hall
                           Road, Sturbridge, Massachusetts 01566 (the "Parent"),
                           SpecTran   Communication  Fiber  Technologies,   Inc.
                           ("SCFT"), a Delaware corporation having an address at
                           50 Hall Road,  Sturbridge,  Massachusetts  01566, and
                           Applied Photonic Devices,  Inc.  ("APD"),  a Delaware
                           corporation  having  an  address  at 300  Lake  Road,
                           Dayville, Connecticut 06241, and Fleet National Bank,
                           a  national  banking   association   ("Lender")  have
                           entered  into a certain  Loan  Agreement  dated as of
                           December 1, 1996, a copy of which is attached  hereto
                           as Schedule 1 and made a part hereof and the terms of
                           which are incorporated  herein, as amended by a First
                           Amendment to Loan Agreement dated as of September 30,
                           1998, a copy of which is attached  hereto as Schedule
                           1-a and made a part hereof and the terms of which are
                           incorporated  herein (the Loan Agreement as presently
                           constituted  and as amended by the First Amendment to
                           Loan  Agreement  and as the  same  may  hereafter  be
                           amended  from  time to time,  the  "Loan  Agreement")
                           which Loan  Agreement  provides for the  extension of
                           credit to Grantor,  the  Parent,  SCFT and APD in the
                           nature of a revolving  line of credit  facility  (the

<PAGE>

                           "Facility") as evidenced by a certain  Revolving Note
                           dated as of  December  1,  1996,  in face  amount  of
                           $20,000,000,  a copy of which is  attached  hereto as
                           Schedule  2 and made a part  hereof  and the terms of
                           which are incorporated  herein, as amended by a First
                           Amendment to Revolving Note dated as of September 30,
                           1998, a copy of which is attached  hereto as Schedule
                           2-a and made a part hereof and the terms of which are
                           incorporated  herein (the Revolving Note as presently
                           constituted  and as amended by the First Amendment to
                           Revolving  Note  and as the  same  may  hereafter  be
                           amended,  extended, renewed or consolidated from time
                           to time,  together with any and all promissory  notes
                           that may have  been or may be  exchanged  or given in
                           substitution   therefor  from  time  to  time,  being
                           collectively  referred  to herein  as the  "Revolving
                           Credit  Notes"),  which  Revolving  Credit Notes bear
                           interest and are payable as set forth  therein and in
                           the Loan Agreement,  and mature on April 1, 2000, all
                           as more particularly provided therein and in the Loan
                           Agreement;

                           (b) The Loan Agreement Amendment,  attached hereto as
                  Schedule 1-a is hereby  attached to the  Existing  Mortgage as
                  Schedule 1-a and made a part  thereof,  and the terms  thereof
                  are hereby incorporated in the Existing Mortgage.

<PAGE>

                           (c) The Revolving Note Amendment  attached  hereto as
                  Schedule 2-a is hereby  attached to the  Existing  Mortgage as
                  Schedule 2-a and made a part  thereof,  and the terms  thereof
                  are hereby incorporated in the Existing Mortgage.

2.       Continued Force and Effect; References to Existing Mortgage.

                           (a) All of the terms and  conditions  of the  Amended
                  Loan Agreement,  the Amended Revolving Note, the Guaranty, the
                  Amended  Mortgage  and the other  Lending  Documents  to which
                  Mortgagor is a party and the  indebtedness  evidenced  thereby
                  and/or the  collateral  security  provided  thereby are hereby
                  ratified and confirmed in all respects and shall remain and in
                  full force and effect.  Nothing  contained  in this  Agreement
                  shall (i) be deemed to cancel, extinguish,  release, discharge
                  or constitute  payment or  satisfaction of the Amended Note or
                  the  Guaranty  or the  indebtedness  evidenced  thereby  or to
                  otherwise affect the obligations  represented  thereby, all of
                  which  obligations  are  hereby  continued  and remain in full
                  force  and  effect;   (ii)  constitute  a  new  or  additional
                  indebtedness  or  constitute a readvance of any loan; or (iii)
                  be deemed to impair in any manner the validity, enforceability
                  or priority of the Amended Mortgage or the lien thereof.



<PAGE>


                           (b)  From  and  after  the date  hereof,  unless  the
                  context shall clearly require otherwise, all references in any
                  of the  Lending  Documents  to the  Existing  Mortgage  or the
                  security  provided  thereby  (regardless  of the term or terms
                  used to make any such reference) shall be deemed and construed
                  to  refer,  respectively,  to the  Amended  Mortgage  and  the
                  security  provided  thereby.  The Lending Documents are hereby
                  modified to  incorporate  therein the  aforesaid  definitions,
                  interpretations and other terms and provisions.

                           (c) In the event of any conflict between the terms of
                  this  Agreement  and the terms of the Existing  Mortgage,  the
                  terms of this Agreement shall control.

3.       No  Defenses,  Counterclaims  or Rights  of  Offset.  Mortgagor  hereby
         acknowledges,  admits,  and agrees that,  as of the date hereof,  there
         exists no rights of offset, defense, counterclaim,  claim, or objection
         in favor of Mortgagor with respect to the Amended Loan  Agreement,  the
         Amended  Revolving  Note,  the Guaranty,  the Amended  Mortgage and the
         other   Lending   Documents  to  which   Mortgagor   is  a  party,   or
         alternatively,  that  any  and  all  such  right  of  offset,  defense,
         counterclaim, claim, or objection which Mortgagor may have or claim, of
         any nature  whatsoever,  whether known or unknown,  is hereby expressly
         and irrevocably waived and released.

<PAGE>

4.       Miscellaneous.

                           (a) The Recitals  set forth at the  beginning of this
                  Agreement  are  incorporated  in  and  made  a  part  of  this
                  Agreement by this reference.

                           (b) This  Agreement  may be  executed  in one or more
                  identical counterparts, each of which shall be deemed to be an
                  original, and all of which, taken together, shall be deemed to
                  be one and the same Agreement.

(3)  This  Agreement  shall bind and inure to the benefit of the parties  hereto
     and   their   respective   heirs,  executors,  administrators,  legal
     representatives, successors and assigns. This Agreement and the obligations
     of such  parties  hereunder  are and at all times shall be deemed to be for
     the exclusive  benefit of such parties and their respective  successors and
     assigns, and nothing set forth herein shall be deemed to be for the benefit
     of any other person. Nothing set forth in this paragraph shall be deemed or
     construed to create,  recognize or allow any assignment or transfer  rights
     not otherwise provided for in the Lending Documents.

                  [Remainder of page intentionally left blank.]



<PAGE>



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

Signed and Acknowledged SPECTRAN SPECIALTY OPTICS COMPANY in the Presence of:


_______________________________               By________________________________
Name:                                                          Name:
                                                              Its:


-------------------------------
Name:


STATE OF NEW YORK                                    )
                                                              ) ss.
COUNTY OF                                            )

         Personally Appeared  ____________________________ of SPECTRAN SPECIALTY
OPTICS COMPANY, a Delaware  corporation,  as aforesaid,  Signer of the foregoing
Instrument,  and  acknowledged  the same to be his/her free act and deed as such
______________________ and the free act and deed of said corporation, before me.


                                            ------------------------------------

                                            Notary Public
                             My Commission Expires:


                                                                       [SEAL]


<PAGE>




Signed and Acknowledged              STATE STREET BANK AND TRUST in the Presence
of:                                         COMPANY , as Trustee




_______________________________               By________________________________
Name:                                                         Name:
                                                              Its:


-------------------------------
Name:




COMMONWEALTH OF MASSACHUSETTS       )
                                            )ss.
COUNTY OF                           )


         Personally  appeared   _____________________________________  of  State
Street Bank and Trust Company,  a Massachusetts  trust company,  as Trustee,  as
aforesaid,  Signer of the foregoing instrument,  and acknowledged the same to be
his/her free act and deed as such _________________________________ and free act
and deed of said trust company, before me.

                                            ------------------------------------

                                            Notary Public
                             My Commission Expires:


<PAGE>



                                   Exhibit A-1

                                    EXHIBIT A

                               [Legal Description]


<PAGE>



                                 Schedule 1-a-0

                                  SCHEDULE 1-a

                           [Loan Agreement Amendment]


<PAGE>



                                 Schedule 2-a-1

                                  SCHEDULE 2-a

                           [Revolving Note Amendment]