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                                                                   EXHIBIT 10.26





                                                                  APPROVED BY:
                                                     -------------- ------------
                                                         ORC#         INITIALS
                                                     -------------- ------------
                                                     -------------- ------------
                                                     -------------- ------------
                                                         AMENDED AND RESTATED*
                                                        PRIMARY ORC #:
                                                     ---------------------------

[NBD LOGO] MASTER DEMAND BUSINESS LOAN NOTE

Due on Demand                                                 $10,000,000

No.                                              Date: December    , 1998
    -------------------                                        ----

PROMISE TO PAY. For value received, the undersigned (collectively, the
"Borrower") promises to pay ON DEMAND TO NBD BANK (the "Bank"), or order, at any
office of the Bank in the State of Michigan, the sum of TEN MILLION DOLLARS
($10,000,000), or such lesser sum as is indicated on Bank records, plus interest
computed on the basis of the actual number of days elapsed in a year of 360 days
at the rate of:

         1% per annum above the rate announced from time to time by the Bank as
         its "prime" rate (the "Note Rate"), which rate may not be the lowest
         rate charged by the Bank to any of its customers, until default or
         until maturity, whether by default, demand, acceleration or otherwise,
         and at the rate of 3% per annum above the Note Rate after maturity or
         default. Each change in the "prime" rate will immediately change the
         Note Rate.

In no event shall the interest rate exceed the maximum rate allowed by law; any
interest payment which would for any reason be deemed unlawful under applicable
law shall be applied to principal.

Interest will be computed on the unpaid principal balance from the date of each
borrowing.

The Borrower will pay this sum on demand. Until demand, the Borrower will pay
consecutive monthly installments of interest only commencing December __, 1998.

LATE FEE. If any payment is not received by the Bank within fifteen days after
its due date, the Bank may assess and the Borrower agrees to pay a late fee
equal to the lesser of five percent of the past due amount or $500.

MASTER DEMAND NOTE. The Bank has authorized a discretionary credit facility to
the Borrower in a principal amount not to exceed the face amount of this note.
The credit facility is in the form of loans made from time to time by the Bank
to the Borrower at the Bank's sole discretion. This note evidences the
Borrower's obligation to repay those loans. The aggregate principal amount of
debt evidenced by this note shall be the amount reflected from time to time in
the records of the Bank but shall not exceed the face amount of this note. The
Borrower acknowledges and agrees that no provision of this note and no course of
dealing by the Bank shall commit the Bank to make loans to the Borrower and that
notwithstanding any provision of this note or any other instrument or document,
all loans evidenced by this note are due and payable on demand, which may be
made by the Bank at any time, whether or not any event of acceleration then
exists.

CREDIT AGREEMENT. This note evidences a debt under the terms of an Amended and
Restated Revolving Credit and Loan Agreement between the Bank, Integral Vision,
Ltd. and the Borrower dated July 31, 1998, as amended by an Amendment and
Forbearance Agreement of approximate even date herewith (the "Forbearance
Agreement").

SECURITY. To secure the payment of this note and any other present or future
liability of the Borrower, whether several, joint, or joint and several, the
Borrower pledges and grants to the Bank a continuing security interest in the
following described property and all of its additions, substitutions,
increments, proceeds and products, whether now owned or later acquired
("Collateral"):

1.       All securities and other property of the Borrower in the custody,
         possession or control of the Bank (other than property held by the Bank
         solely in a fiduciary capacity);
2.       All property or securities declared or acknowledged to constitute
         security for any past, present or future liability of the Borrower to
         the Bank;
3.       All balances of deposit accounts of the Borrower with the Bank;
4.       The following additional property: Among other things, (a) all of
         Medar, Inc.'s present and future accounts, chattel paper, general
         intangibles, inventory, equipment, fixtures, documents, and instruments
         and all products and proceeds of the foregoing, as more fully described
         in the General Security Agreement dated March 29, 1996 (as amended and
         with all supplements thereto) and in the Collateral Assignment of
         Proprietary Rights and Security Agreement dated July 15, 1997 (as
         amended and with all supplements thereto), all as amended by the
         Forbearance Agreement; (b) a Future Advance Mortgage dated October 31,
         1995 on the premises located at 24755 Crestview Court, Farmington
         Hills, Michigan, as recorded in Liber 15799, Page 151 of the Oakland
         County Records (as may be amended or as may be further amended,
         including, but not limited to, by the First Amendment to Mortgage dated
         the approximate even date herewith, and with all supplements thereto);
         and (c) the Amended and Restated Mortgage and Security Agreement dated
         June 29, 1993 on the premises located at 38700 Grand River, Farmington
         Hills, Michigan, as recorded in Liber 13885, Page 040, of the Oakland
         County Records (as may be amended and as may be further amended,
         including, but not limited to, by the First Amendment to Amended and
         Restated Mortgage and Security Agreement of approximate even date
         herewith and with all supplements thereto).

BANK'S RIGHT TO SETOFF. The Bank shall have the right at any time to apply its
own debt or liability to the Borrower or to any other party liable on this note
in whole or partial payment of this note or other present or future liabilities,
without any requirement of mutual maturity.

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REPRESENTATIONS BY BORROWER. Each Borrower represents: (a) that the execution
and delivery of this note and the performance of the obligations it imposes do
not violate any law, conflict with any agreement by which it is bound, or
require the consent or approval of any governmental authority or any third
party; (b) that this note is a valid and binding agreement, enforceable
according to its terms; and (c) that all balance sheets, profit and loss
statements, and other financial statements furnished to the Bank are accurate
and fairly reflect the financial condition of the organizations and persons to
which they apply on their effective dates, including contingent liabilities of
every type, which financial condition has not changed materially and adversely
since those dates. Each Borrower, other than a natural person, further
represents: (a) that it is duly organized, existing and in good standing
pursuant to the laws under which it is organized; and (b) that the execution and
delivery of this note and the performance of the obligations it imposes (i) are
within its powers and have been duly authorized by all necessary action of its
governing body; and (ii) do not contravene the terms of its articles of
incorporation or organization, its by laws, or any partnership, operating or
other agreement governing its affairs.

EVENTS OF DEFAULT/ACCELERATION. If any of the following events occurs, this note
shall be due immediately without notice at the Bank's option whether or not the
Bank has made demand.

1.       The Borrower or any guarantor of this note ("Guarantor") fails to pay
         when due any amount payable under this note or under any agreement or
         instrument evidencing debt to any creditor;
2.       The Borrower or any Guarantor (a) fails to observe or perform any other
         term of this note; (b) makes any materially incorrect or misleading
         representation, warranty, or certificate to the Bank; (c) makes any
         materially incorrect or misleading representation in any financial
         statement or other information delivered to the Bank; or (d) defaults
         under the terms of any agreement or instrument relating to any debt for
         borrowed money (other than the debt evidenced by this note) such that
         the creditor declares the debt due before its maturity;
3.       There is a default under the terms of any loan agreement, mortgage,
         security agreement, or any other document executed as part of the loan
         evidenced by this note, or any guaranty of the loan evidenced by this
         note becomes unenforceable in whole or in part, or any Guarantor fails
         to promptly perform under its guaranty;
4.       A "reportable event" (as defined in the Employee Retirement Income
         Security Act of 1974 as amended) occurs that would permit the Pension
         Benefit Guaranty Corporation to terminate any employee benefit plan of
         the Borrower or any affiliate of the Borrower;
5.       The Borrower or any Guarantor becomes insolvent or unable to pay its
         debts as they become due;
6.       The Borrower or any Guarantor (a) makes an assignment for the benefit
         of creditors; (b) consents to the appointment of a custodian, receiver,
         or trustee for itself or for a substantial part of its assets; or (c)
         commences any proceeding under any bankruptcy, reorganization,
         liquidation, insolvency or similar laws of any jurisdiction;
7.       A custodian, receiver, or trustee is appointed for the Borrower or any
         Guarantor or for a substantial part of its assets without the consent
         of the party against which the appointment is made and is not removed
         within 60 days after such appointment;
8.       Proceedings are commenced against the Borrower or any Guarantor under
         any bankruptcy, reorganization, liquidation, or similar laws of any
         jurisdiction, and such proceedings remain undismissed for 60 days after
         commencement; or the Borrower or Guarantor consents to the commencement
         of such proceedings;
9.       The Borrower or any Guarantor, without the Bank's written consent, (a)
         is dissolved, (b) merges or consolidates with any third party, (c)
         leases, sells or otherwise conveys a material part of its assets or
         business outside the ordinary course of business, (d) leases, purchases
         or otherwise acquires a material part of the assets of any other
         corporation or business entity except in the ordinary course of
         business, or (e) agrees to do any of the foregoing (notwithstanding the
         foregoing, any subsidiary may merge or consolidate with any other
         subsidiary, or with the Borrower so long as the Borrower is the
         survivor);
10.      There is a substantial change in the existing or prospective financial
         condition of the Borrower or any Guarantor which the Bank in good faith
         determines to be materially adverse;
11.      The Bank in good faith deems itself insecure.

REMEDIES. If this note is not paid at maturity, whether by acceleration or
otherwise, the Bank shall have all of the rights and remedies provided by any
law or agreement. Any requirement of reasonable notice shall be met if the Bank
sends the notice to the Borrower at least seven (7) days prior to the date of
sale, disposition or other event giving rise to the required notice. The Bank is
authorized to cause all or any part of the Collateral to be transferred to or
registered in its name or in the name of any other person, firm or corporation,
with or without designation of the capacity of such nominee. The Borrower shall
be liable for any deficiency remaining after disposition of any Collateral. The
Borrower is liable to the Bank for all reasonable costs and expenses of every
kind incurred in the making or collection of this note, including, without
limitation, reasonable attorneys' fees and court costs. These costs and expenses
shall include, without limitation, any costs or expenses incurred by the Bank in
any bankruptcy, reorganization, insolvency or other similar proceeding.

WAIVER. Each endorser and any other party liable on this note severally waives
demand, presentment, notice of dishonor and protest, and consents to any
extension or postponement of time of its payment without limit as to the number
or period, to any substitution, exchange or release of all or part of the
Collateral, to the addition of any party, and to the release or discharge of, or
suspension of any rights and remedies against, any person who may be liable for
the payment of this note. No delay on the part of the Bank in the exercise of
any right or remedy shall operate as a waiver. No single or partial exercise by
the Bank of any right or remedy shall preclude any other future exercise of it
or the exercise of any other right or remedy. No waiver or indulgence by the
Bank of any default shall be effective unless in writing and signed by the Bank,
nor shall a waiver on one occasion be construed as a bar to or waiver of that
right on any future occasion.

MISCELLANEOUS. The Borrower, if more than one, shall be jointly and severally
liable, and the term "Borrower" shall mean any one or more of them. This note
shall be binding on the Borrower and its successors, and shall inure to the
benefit of the Bank, its successors and assigns. Any reference to the Bank shall
include any holder of this note. This note is delivered in the State of Michigan
and governed by Michigan law. Section headings are for convenience of reference
only and shall not affect the interpretation of this note.

WAIVER OF JURY TRIAL. The Bank and the Borrower knowingly and voluntarily waive
any right either of them have to a trial by jury in any proceeding (whether
sounding in contract or tort) which is in any way connected with this or any
related agreement, or the

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relationship established under them. This provision may only be modified in a
written instrument executed by the Bank and the Borrower.



*This Amended and Restated Master Demand Business Loan Note (this "Note") is in
substitution and exchange for a Revolving Note dated July 31, 1998, in the
original principal amount of $10,000,000 (the "Original Note"). This Note shall
not in any circumstances be deemed a novation or to have terminated,
extinguished or discharged Borrower's obligations evidenced by the Original
Note. This Note is issued pursuant to the Forbearance Agreement. Any Default,
Unmatured Default, default or Event of Acceleration under the Forbearance
Agreement or any document or instrument executed in connection herewith shall be
an Event of Default under this Note.


ADDRESS:                                    BORROWER:

38700 Grand River                           Medar, Inc.
Farmington Hills, MI  48335

                                            By:
                                               ---------------------------------

38700 Grand River                           Integral Vision, Ltd.
Farmington Hills, MI  48335

                                            By:
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