Document:

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EXHIBIT 10.17

                               OPERATING AGREEMENT
                                       OF
                                 NN GENERAL, LLC

      THIS OPERATING AGREEMENT (this "Agreement") is made and entered into as of
March 16, 2000, by and among NN Ball & Roller, Inc., a Delaware corporation
("NN") and General Bearing Corporation, a Delaware corporation ("GBC")
(hereinafter sometimes referred to individually as a "Member" or collectively as
the "Members.")

                                    RECITALS

      WHEREAS, the Members desire to form a limited liability company called NN
General, LLC (the "Company") pursuant to the provision of the Delaware Limited
Liability Company Act (the "Act"); and

      WHEREAS, the Members, being all of the members of the Company, desire and
agree to enter into this Operating Agreement in accordance with the Act;

      NOW, THEREFORE, in consideration of the mutual covenants and premises
herein, and for other good and valuable consideration, the receipt and legal
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:

                                   ARTICLE I
                               GENERAL PROVISIONS

      Section 1.1. Formation of the Company. The Members hereby agree to form
the Company in accordance with the Act and associate themselves as Members in
the Company as formed under and pursuant to the provisions of the Act for the
purposes set forth in this Operating Agreement. The Members agree that the
rights, obligations, and interests of the Members in the Company shall be
governed by the terms of this Operating Agreement. The Board of Managers (as
defined in Section 2.1 hereof) shall take such actions as may be required to
effect such formation including registration of the Company as a foreign limited
liability company in any other jurisdiction in which such registration is
necessary or appropriate. The costs and expenses associated with such formation
shall be borne by the Company and the Company shall reimburse each Member for
any and all out-of-pocket costs incurred by the Member directly related to the
formation of the Company. The term of the Company shall be as set forth in the
Articles of Organization of the Company and shall continue until dissolution and
termination of the Company in accordance with the provisions thereof and hereof.

      Section 1.2. Name. The business and affairs of the Company shall be
conducted solely under the name of "NN General, LLC" and such name shall be used
at all times in connection with the business and affairs of the Company.

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      Section 1.3. Purpose. The Company is organized for a profit and the nature
of its business and purposes to be conducted or promoted are to engage in any
lawful act or activities for which limited liability companies may be organized
under the Act.

      Section 1.4. Place of Business. The Company shall maintain a place of
business at such place or places as the Board of Managers may from time to time
designate.

      Section 1.5. Names and Addresses of the Members and the Appointment of the
Initial Board of Managers. The names and mailing addresses of the Members and
the initial Managers of the Company are as follows:

               Name of Member               Address of Member
               --------------               -----------------

            NN Ball & Roller, Inc.        800 Tennessee Road
                                          Erwin, Tennessee  37650
                                          USA

            General Bearing Corporation   44 High Street
                                          West Nyack, New York 10994
                                          USA

            Name of Initial Managers      Address of Initial Managers
            ------------------------      ---------------------------

            David L. Dyckman              800 Tennessee Road
                                          Erwin, Tennessee  37650
                                          USA

            David L. Gussack              44 High Street
                                          West Nyack, New York 10994
                                          USA

                                   ARTICLE II
                                   DEFINITIONS

      Section 2.1. Definitions. Capitalized terms used in this Agreement shall
have the meanings set forth below or as otherwise specified herein:

      "Affiliate" means (1) any executive officer or director of a Member or
Manager, (2) any person that controls, is controlled by or is under common
control with such Member or Manager, and (3) any executive officer or director
of any entity described in (2) above.

      "Agreement" means this Operating Agreement, as the same may be further
amended and/or restated from time to time.

      "Board" means the Board of Managers.

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      "Board of Managers" means the individuals elected by the Members pursuant
to Section 7.1 hereof (and their respective successors).

      "Company" means NN General, LLC.

      "Dissolution Proceeds" is defined in Section 10.2.

      "Distribution Percentage" shall be, for each Member, the total number of
Membership Units held by the Member divided by the total number of Membership
Units issued by the Company and shall initially be as set forth opposite such
Member's name, as follows:

             Member                  Distribution Percentage
             ------                  -----------------------

               NN                              50%

              GBC                              50%

                                              100%
                                              ----

      A Member's "Interest" in the Company means the right of such Member to any
and all distributions to which such Member may be entitled as provided in this
Agreement, together with the duties and obligations of such Member to comply
with all of the terms and provisions of this Agreement.

      "Member" has the meaning set forth in the introductory paragraph.

      "Member Loans" is defined in Section 3.3.

      "Membership Units" shall mean all of the units issued by the Company to
represent a Member's Interest including both Class A Membership Units and Class
B Membership Units.

      "Members Owning a Voting Majority" shall mean Members who, in the
aggregate, hold not less than 60% of the Distribution Percentages of the Company
owned by all of the Members entitled to vote on the decision being taken.

      "Net Book Value" means the Company's total assets less its total
liabilities as shown on its last regularly prepared balance sheet.

      "Net Cash Receipts" for the applicable period means the gross receipts of
the Company during such period, plus any reductions in funded reserves arising
out of the reversal of such reserves, less the following: (1) operating expenses
paid during such period; (2) interest and principal paid during such period on
indebtedness of the Company other than interest and principal paid on Member
Loans; (3) expenditures for capital improvements and other capital items paid
during such period; and (4) additions to reserves made during such period. For
purposes of the foregoing, (a) gross receipts of the Company shall not include
Dissolution Proceeds, or any amount entering into the calculation thereof, and
shall not include capital contributions or Member Loans; (b) reserves for
anticipated or contingent liabilities and working capital shall be established
for the Company in such amounts as are reasonably determined by

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the Board; and (c) no deductions from gross receipts of the Company shall be
made for amounts paid out of funded reserves.

      "Officer" shall mean the individuals designated or elected as President,
Vice President, Secretary, or Treasurer as provided in this Agreement.

      Section 2.2. Additional Definitions. The definitions in Section 2.1 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun used herein shall include the
corresponding masculine, feminine and neuter forms. The term "person" includes
individuals, partnerships, corporations, limited liability companies, trusts,
and other associations. The words "include," "includes," and "including" shall
be deemed to be followed by the phrase "without limitation." The words "herein,"
"hereof," "hereunder," and similar terms shall refer to this Agreement, unless
the context otherwise requires.

                                  ARTICLE III
                              CAPITAL CONTRIBUTIONS

      Section 3.1. Initial Capital Contributions.

      (a) GBC shall make the capital contribution to the Company as reflected on
Schedule 1, attached hereto and incorporated herein by reference, in exchange
for a fifty percent (50%) Interest in the Company, represented by fifty (50)
Class A Membership Units in the Company.

      (b) NN shall make the capital contribution to the Company as reflected on
Schedule 1, attached hereto and incorporated herein by reference, in exchange
for a fifty percent (50%) Interest in the Company, represented by fifty (50)
Class B Membership Units in the Company.

      (c) The Class A Membership Units and Class B Membership Units shall have
identical rights on all matters except the Class A Membership Units shall be
allowed to receive distributions disproportional to the Class B Membership Units
as provided in Section 4.1 below.

      Section 3.2. GBC Assignment. GBC shall assign to the Company all of its
rights, title and interest (the "GBC Assignment") in and to Jiangsu General Ball
& Roller Co., Ltd. (the "JV"). The Company shall reimburse GBC for all
out-of-pocket costs incurred by GBC directly related to the formation of the JV,
including due diligence expenses, legal expenses, and any capital contributions
made to the JV by GBC before the assignment by GBC to the Company all as
completely set forth on Schedule 2 attached hereto and incorporated herein by
reference. GBC shall use its best efforts to obtain, if required, the approval
of the Approval Committee, as defined below, of the assignment by GBC of its
interest in the JV. GBC, to the best of its knowledge, represents and warrants
to the Company with respect to the GBC Assignment that:

            (a) GBC and Jiangsu Lixing Steel Ball Factory ("JSBF") have formed
      the JV under the laws of the People's Republic of China (the "PRC") to own
      and operate the business of manufacturing and marketing high quality
      rolling elements for bearings and other related products in the
      manufacturing facility located in Rugao City, Jiangsu Province, People's
      Republic of China ("JSBF Business") and own a 60% and 40%

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      interest therein, respectively. No other person or entity owns or has the
      right, now or at any time in the future, to acquire any interest in the
      JV. GBC has previously delivered to NN a true, correct and complete copy
      of the Joint Venture Contract and the Articles of Association of the JV,
      as amended, and such documents (a) reflect the entire agreement between
      GBC and JSBF related to the ownership and operation of the JSBF Business
      and (b) remain in effect and have not been further amended or modified.

            (b) GBC has full power and authority to enter into this Agreement
      and to undertake and complete the transactions contemplated hereby. No
      consent or approval by any person or entity is required in order for GBC
      to enter into or complete the transactions contemplated by this Agreement,
      other than the approval from the Rugao International Economic Committee,
      Jiangsu Province, China (the "Approval Committee") required for the
      assignment of GBC's Assignment in the JV as contemplated hereby.

            (c) GBC has fully and accurately disclosed to NN all material
      information related to the JV, JSBF and the JSBF Business. To GBC's best
      knowledge,

                  (1) JSBF has operated and since its formation the JV has
            operated, and continues to operate in accordance with all applicable
            law and all contracts, agreements, and orders binding on them;

                  (2) JSBF had full power and authority to transfer its assets
            and liabilities to the JV, subject only to governmental approvals
            all of which have been obtained;

                  (3) the JV was formed and currently exists in accordance with
            all applicable law;

                  (4) the JV owns or controls under leases all assets, tangible
            and intangible, necessary to carry on the JSBF Business as conducted
            prior to the formation of the JV; and

                  (5) The financial information of JSBF, the due diligence
            report by KPMG, and all other documents provided to NN are as
            provided to GBC.

      Section 3.3. Member Loans. Immediately after the execution of this
Agreement, the Members shall loan the Company the amounts reflected in Schedule
3, attached hereto and incorporated herein by reference, and NN agrees to loan
the Company up to an additional US$1,000,000 (together with the amount for NN
reflected in Schedule 3 the "NN Member Loan") and GBC agrees to loan the Company
up to an additional US$1,500,000 (together with the amount for GBC reflected in
Schedule 3 the "GBC Member Loan"). All Member Loans shall be in the form of the
promissory notes (the "Notes") in Schedule 4, attached hereto and incorporated
herein by reference. Notwithstanding anything to the contrary herein, the member
of the Board of Managers appointed by NN shall have authority to execute the
Notes evidencing the Member Loans described in this Section.

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      Section 3.4. Additional Capital Contributions. No Member shall be required
to make any capital contributions to the Company beyond the capital
contributions made pursuant to Section 3.1. In the event the Company needs
additional funding, as determined by the Board of Managers, any Member shall
have the right, but not the obligation, to contribute additional capital to the
Company.

      Section 3.5. No Interest on Capital. Except as expressly provided in
Article IV and/or Article X hereof, no Member shall be paid interest on any
capital contribution.

                                   ARTICLE IV
                                  DISTRIBUTIONS

      Section 4.1. Distributions of Net Cash Receipts. Subject to the provisions
of Section 10.2 hereof (governing the application of Dissolution Proceeds), the
Company's Net Cash Receipts shall be distributed to the Members in proportion to
their respective Distribution Percentages at such times as the Board shall
determine in its sole and absolute discretion on the following basis:

            (a) first, used to repay the principal and interest on the Member
      Loans on a dollar for dollar basis until the GBC Member Loan is repaid in
      full;

            (b) then, to the Member holding Class A Membership Units and to
      repay the principal and interest on the NN Member Loan on a dollar for
      dollar basis; and

            (c) when both of the Member Loans have been repaid in full, Net Cash
      Receipts shall be distributed to the holders of the Class A Membership
      Units and Class B Membership Units according to their respective
      Distribution Percentages.

      Section 4.2. Distributions to Be Made In Cash. Unless otherwise determined
by the Board, all distributions shall be made in cash and no Member shall have
the right to receive distributions of property other than cash either during the
term of the Company or upon its dissolution. No Member may be compelled to
accept a distribution of any property other than cash from the Company unless
all Members receive undivided ownership interests therein that are in proportion
to their respective Distribution Percentages.

                                   ARTICLE V
                        ALLOCATION OF PROFITS AND LOSSES

      Section 5.1. Profits and Losses. The Company's income, gains, losses,
deductions and credits (and items thereof), for each fiscal year of the Company,
shall be allocated among the Members (for both book and tax purposes) in
proportion to their respective Distribution Percentages.

                                   ARTICLE VI
                                   ACCOUNTING

      Section 6.1. Accounting Methods. The Company books and records shall be
prepared in accordance with United States generally accepted accounting
principles, consistently applied.

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A copy of the Company books and records shall be distributed to the parties
within forty-five (45) days after the end of each financial quarter and ninety
(90) days after the end of each fiscal year of the Company. The Company shall be
on an accrual basis for both tax and accounting purposes. All tax returns of the
Company shall be prepared by the Company's certified public accountants, under
the direction of the Members.

      Section 6.2. Fiscal Year. The fiscal year of the Company shall be the
calendar year, except that the first fiscal year shall be the period beginning
on the date of formation of the Company and ending on December 31, 2000.

                                  ARTICLE VII
                             MANAGEMENT AND CONTROL

      Section 7.1 Appointment of Board of Managers. The Company shall initially
have a Board of Managers consisting of two (2) members, one each appointed by NN
and GBC. If at any time any Member's Distribution Percentage is equal to or
greater than 66.67% (a "Controlling Member"), such Controlling Member shall have
the right to increase the size of the Board of Managers to three (3) and to
appoint an additional Member to the Board. Each member of the Board so chosen
shall hold office until a successor shall be duly appointed.

      Section 7.2 Authority of Board of Managers.

            (a) The management of the Company shall be vested exclusively in the
      Board of Managers, and subject to the rights expressly granted to the
      Members under other provisions of this Agreement, the Board of Managers
      shall have the exclusive right, authority, and responsibility to manage
      and control the business, affairs and the day-to-day operations of the
      Company, and to make all decisions with respect thereto. Pursuant to this
      Article VII and subject to the other provisions of this Agreement, the
      Board of Managers shall have all of the rights and powers of a "manager"
      as provided in the Act and as otherwise provided by law.

            (b) Without in any way limiting the general powers and authority of
      the Board of Managers, the Board shall have the exclusive right, power and
      authority, on behalf of the Company and in its name, to:

                  (1) Acquire, purchase, hold, exercise, operate, lease and
            manage the business property of the Company and to contract for and
            enter into agreements with others with respect to the acquisition,
            purchase, holding, exercise, operation, leasing and management of
            such business property;

                  (2) To execute and deliver, in furtherance of any or all of
            the purposes of the Company, and deed, lease, mortgage, security
            agreement, note, bill of sale, contract or other instrument
            purporting to convey, exchange, sell or encumber all or any part of
            the business property or any Interest therein of the Company;

                  (3) To execute and deliver any and all agreements, contracts,
            documents, certifications, and instruments necessary or convenient
            in connection with the ordinary conduct of the business and affairs
            of the Company and to give such

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            receipts, releases and discharges with respect to all of the
            foregoing and all matters incident thereto;

                  (4) To borrow money and issue evidences of indebtedness and
            assume existing indebtedness necessary, convenient or incidental to
            the accomplishment of the purposes of the Company;

                  (5) To deposit or invest Company funds in such
            interest-bearing or non-interest bearing investments or accounts at
            a federally insured bank as the Board deems advisable to the extent
            such funds are not then required for Company operations and are not
            required to be distributed pursuant to this Agreement;

                  (6) To extent that that the funds of the Company are available
            therefor, to pay (or prepay) all debts and other obligations of the
            Company; and

                  (7) To supervise the operation, maintenance, manufacture,
            management and repair of the business property, including hiring,
            coordinating the services of, supervising the performance of, and
            terminating employees, independent contractors and other persons
            necessary or appropriate to carry out the business and purposes of
            the Company.

            (c) Any person dealing with the Company may rely upon a certificate
      signed by the Board of Managers, or any person thereunto duly authorized
      by the Board of Managers, as to:

                  (1) The identity of any officer or any Member;

                  (2) The existence or non-existence of any fact which may
            constitute a condition precedent to acts by the Company or any
            Member or in any other matter germane to the affairs of the Company;

                  (3) The persons who are authorized to execute and deliver any
            instrument or document of the Company; or

                  (4) Any act or failure to act by the Company.

      Section 7.3 Meetings; Voting Requirements. The Board of Managers shall
meet at least once every six (6) months. At the option of the Board of Managers,
meetings of the Board of Managers may be conducted by telephone. The affirmative
vote of sixty percent (60%) of the members of the Board shall be the act of the
Board of Managers. The Board may take action upon the unanimous written consent
of sixty percent (60%) of the members of the Board.

      Section 7.4 Outside Activities. A member of the Board of Managers shall
not be required to manage the Company as its sole and exclusive function, but
shall devote whatever time, effort and skill as may be reasonably necessary to
the conduct of the Company's business.

      Section 7.5 Limitations on Board of Managers. The Board of Managers shall
not, without the prior written consent of all Members:

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            (a) Issue any ownership Interest in the Company to any party other
      than NN or GBC or their 100% owned affiliates.

            (b) Sell all or substantially all of the assets of the Company.

            (c) Dissolve or liquidate the Company.

            (d) Incur any indebtedness of the Company.

            (e) Do any act in contravention of this Agreement;

            (f) Do any act which would make it impossible to carry on in the
      ordinary course of the business of the Company; or

            (g) Change or reorganize the Company into any other legal form.

      Section 7.6 Indemnification.

            (a) The Company shall indemnify any member of the Board of Managers
      and its agents and affiliates (and their respective partners, directors,
      officers, employees, agents, members, shareholders and affiliates) and
      officers or employees of the Company against any and all losses,
      liabilities, damages or expenses (including, without limitation,
      reasonable attorneys' fees and expenses in connection therewith in amounts
      paid in settlement thereof) to which any of such persons may directly or
      indirectly become subject, but only to the extent that such person (i)
      acted in good faith and (ii) acted in a manner such person reasonably
      believed to be in or not opposed to the best interests of the Company.

            (b) Expenses (including attorneys' fees) incurred by any person in
      defending any proceeding may be paid by the Company in advance of such
      proceeding's final disposition upon receipt of an undertaking by or on
      behalf of such person to repay such amount if it shall ultimately be
      determined that he or she is not entitled to be indemnified by the
      Company. Such expenses may be similarly paid upon such terms and
      conditions, if any, as the Board of Managers deems appropriate.

      Section 7.7 Compensation.

            Except with respect to out-of-pocket costs as provided in Section
      12.2 or as may be determined by the Board of Managers, no Member shall be
      entitled to compensation for its services to the Company.

                                  ARTICLE VIII
                               MEETINGS AND VOTING

      Section 8.1. Meetings of Members. Meetings of Members may be held for any
purpose or purposes, unless otherwise prohibited by law and may be called by the
Member(s) holding not less than twenty percent (20%) of the Distribution
Percentages of the Company.

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Such written request shall state the purpose or purposes of the proposed
meeting. Business transacted at any meeting of Members shall be limited to the
purposes stated in the notice.

      Section 8.2. Location of Meetings. All meetings of the Members shall be
held at such place as shall be designated from time to time by the Members as
stated in the notice of the meeting or in a waiver of notice thereof. In the
event that the Members shall fail to fix the place for a meeting of Members,
such meeting shall be held at the Company's principal office. At the option of
the Members, meetings of the Members may be conducted by telephone.

      Section 8.3. Notice of Meetings. Notice of each meeting of Members stating
the place, date and hour of the meeting and, the purpose or purposes for which
the meeting is called, shall be given to each Member entitled to vote at such
meeting not less than ten (10) and no more than sixty (60) days before the date
of the meeting.

      Section 8.4. Waiver of Notice. Whenever any notice is required to be given
to any Member under the provisions of this Agreement or of any law, a waiver
thereof in writing signed by such Member, whether before or after the time
stated therein, shall be deemed the equivalent to the giving of such notice.
Attendance of a Member at a meeting shall constitute a waiver of notice of such
meeting, except when the Member attends a meeting for the express and exclusive
purpose of objecting at the beginning of the meeting to the transaction of any
business because the meeting was not lawfully called or convened.

      Section 8.5. Actions and Voting by Members. Except as otherwise
specifically provided under the Act or this Agreement, all decisions reserved to
the Members by this Agreement shall be made by Members Owning a Voting Majority
in Interest. Similarly, at any meeting, Members Owning a Voting Majority shall
decide any question brought before such meeting, unless the question is one upon
which, by express provision of the Act or this Agreement, a different vote is
required.

      Section 8.6. Proxies. At all meetings of the Members, every Member having
the right to vote thereat shall be entitled to vote in person or by proxy
appointed by an instrument in writing subscribed by such Member and bearing a
date not more than three (3) years prior to such meeting.

                                   ARTICLE IX
                         TRANSFER OF MEMBERS' INTERESTS

      Section 9.1. Restrictions. Without the unanimous written consent of all
the Members, no Member may sell, assign, transfer, pledge, mortgage, or
otherwise dispose of all or any part of his or her Interest in the Company. As a
condition to any transfer or assignment of a Member's Interest, the transferor
and the transferee shall provide such legal opinions and documentation as the
non-transferring Members shall reasonably request.

      Section 9.2. Additional Members. The Company may admit additional Members
only with the unanimous written consent of all of the Members.

      Section 9.3. Member Buyout. If a Member shall desire to dispose of its
Interest in the Company, such Member shall have the right to transfer such
Interest to the remaining Members

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in exchange for the amount of consideration agreed to by the Members at the time
of such disposal, and if no agreement as to consideration is reached then the
disposal of such Interest shall be for no consideration.

                                   ARTICLE X
                           DISSOLUTION OF THE COMPANY

      Section 10.1. Dissolution Acts.

            (a) No act, thing, occurrence, event or circumstance shall cause or
      result in the dissolution of the Company except that the happening of any
      one of the following events shall work as an immediate dissolution and
      termination of the Company:

                  (1) A determination by all of the Members to dissolve and
            terminate the Company; or

                  (2) Any event causing the last remaining Member to cease to be
            a member of the Company under the terms of the Act.

            (b) The Company is hereby granted a right to continue and, absent
      the unanimous consent of the remaining Members to the contrary, shall
      continue, upon an Event of Withdrawal of a Member (other than the last
      remaining Member), or upon the occurrence of any other event which
      terminates the continued membership of a Member in the Company.

            (c) Without limiting the other provisions hereof, neither the
      assignment of all or any part of a Member's Interest hereunder, nor the
      admission of a new Member shall cause the dissolution and termination of
      the Company.

      Section 10.2. Distribution of Proceeds on Dissolution. Upon the
dissolution and termination of the Company, the Board of Managers of the Company
shall proceed with the liquidation and termination of the Company as promptly as
possible, but in an orderly and businesslike manner so as not to involve undue
sacrifice. The proceeds therefrom and any other funds and assets of the Company
(the "Dissolution Proceeds"), shall be applied and distributed as follows and in
the following order of priority:

            (a) First, to the payment of debts and liabilities of the Company
      (excluding any liabilities on Member Loans described in Section 3.3) and
      the expenses of liquidation;

            (b) Second, if a dissolution and distribution of proceeds occurs
      within one (1) year from the effective date of this Agreement then, to the
      extent available, the Member Loans shall first be repaid in full, without
      interest, followed by the return of the initial capital contributions of
      each Member and then any remaining cash shall be paid to the Members in
      accordance with their Distribution Percentages; and

            (c) Third, if a dissolution and distribution of proceeds occurs
      after one (1) year from the effective date of this Agreement, then, to the
      extent available, all remaining cash shall be paid to the Members in
      accordance with their Distribution Percentages.

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                                   ARTICLE XI
                              MANAGEMENT OF THE JV

      Section 11.1. JV Board Representation. The Company will have the right to
appoint three members of the board of the JV. NN and GBC agree that so long as
they have equal representation on the Board of the Company that the three JV
board representatives will consist of one person nominated by GBC, one person
nominated by NN and one person mutually agreed by GBC and NN. In the event any
Member becomes a Controlling Member, the three representatives on the JV board
will consist of two persons nominated by the Controlling Member and one person
nominated by the other Member. The initial NN representative on the JV board
shall be Frank Gentry, the initial GBC representative on the JV board shall be
David Gussack who shall also be elected as Chairman of the JV board, and the
initial mutually agreed representative on the JV board shall be Joseph Hoo.

      Section 11.2. JV Board Meetings. The three JV board representatives
appointed by the Company shall cause the JV board to meet at least semi-annually
and shall cause the chairman of the JV board to establish a schedule for such
meetings at the beginning of each year and allow the meetings to be held by
telephone.

      Section 11.3. Related Party Transactions. The terms and conditions of any
equipment lease or loan to the JV by any party related to the JV made prior to
the appointment to the JV board of a person nominated by NN shall be provided in
writing to NN for its review and comment.

      Section 11.4. Formation of Danish Holding Company. The Company shall form
or purchase a holding company organized under the laws of Denmark for the
purpose of holding the interest in the JV.

                                  ARTICLE XII
                                     GENERAL

      Section 12.1. Notices. Any notice, request, approval, consent, demand or
other communication required or permitted hereunder shall be given in writing by
(a) personal delivery, (b) expedited delivery service with proof of delivery,
(c) United States Mail, postage prepaid, registered or certified mail, return
receipt requested, or (d) prepaid telegram, facsimile or telex, confirmed
receipt required (provided that such telegram, facsimile or telex is confirmed
by delivery service or by mail in the manner previously described), and shall be
sent to each party at his respective address set in Section 1.5 hereof (or, in
the case of the Company, the principal office address established pursuant to
Section 1.6 hereof), or to such different address as such addressee shall have
designated by written notice sent in accordance herewith, and shall be deemed to
have been given and received either at the time of personal delivery or, in the
case of delivery service or mail, as of the date of first attempted delivery at
the address and in the manner provided herein, or in the case of telegram,
facsimile or telex, upon receipt. Either Member may change the address and/or
addresses to whom notice may be given by giving notice pursuant to this Section
at least seven (7) days prior to the date the changes become effective.

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      Section 12.2. Public Disclosures. No Member, except as required by law,
shall disclose any financial or operating information about the Company,
including the economic impact of the Member's Interest in the Company, without
the express written approval of the other Members.

      Section 12.3. Amendments. This Agreement may be amended by a written
agreement of amendment executed by all the Members, but not otherwise. No
variations, modifications, amendments, or changes herein or hereof shall be
binding upon any party hereto, unless set forth in a document duly executed by
or on behalf of such party.

      Section 12.4. Miscellaneous. This Agreement supersedes any prior agreement
or understandings between the parties with respect to the Company. This
Agreement and the rights of the parties hereunder shall be governed by and
interpreted in accordance with the Act, without regard to conflict of laws
principles. Except as herein otherwise specifically provided, this Agreement
shall be binding upon and inure to the benefit of the parties and their
respective heirs, legal representatives, successors and assigns. Captions
contained in this Agreement in no way define, limit, or extend the scope or
intent of this Agreement. If any provision of this Agreement or the application
of such provision to any person or circumstance shall be held invalid, the
remainder of this Agreement, or the application of such provision to any other
persons or circumstances, shall not be affected thereby. This Agreement may be
executed in several counterparts, each of which shall be deemed an original, but
all of which shall constitute one and the same document.

      Section 12.5. Remedies. If the Company or any party to this Agreement,
obtains a judgment against any other party by reason of breach of this Agreement
or failure to comply with the provisions hereof, reasonable attorneys' fees as
fixed by the court shall be included in such judgment. Any Member shall be
entitled to maintain, on his own behalf or on behalf of the Company, any action
or proceeding against any other Member or the Company (including any action for
damages, specific performance or declaratory relief) for or by reason of breach
by such party of this Agreement, or any other agreement entered into in
connection with the same, notwithstanding the fact that any or all of the
parties to such proceeding may then be Members, and without dissolving the
Company as a limited liability company. No remedy conferred upon the Company or
any Member in this Agreement is intended to be exclusive of any other remedy
herein or by law provided or permitted, but each shall be cumulative and shall
be in addition to every other remedy given hereunder or now or hereafter
existing at law or in equity or by statute. No waiver by a Member or the Company
of any breach of this Agreement shall be deemed to be a waiver of any other
breach of any kind or nature and no acceptance of payment or performance by a
Member or the Company after any such breach shall be deemed to be a waiver of
any breach of this Agreement, whether or not such Member or the Company knows of
such breach at the time it accepts such payment or performance. If a Member has
the right herein to approve or consent to any matter or transaction, such
approval or consent may be withheld in the sole discretion of such Member for
any reason or no reason. No failure or delay on the part of a Member or the
Company to exercise any right it may have shall prevent the exercise thereof by
such Member or the Company at any time such other may continue to be so in
default, and no such failure or delay shall operate as a waiver of any default.

                                       13
<PAGE>

      IN WITNESS WHEREOF, the parties hereto have executed this Operating
Agreement as of the date first above-written.

                             MEMBERS:

                             NN BALL & ROLLER, INC.

                             By: /s/ Roderick R. Baty
                             Name:  Roderick R. Baty
                             Title: President & Chief Executive Officer

                             GENERAL BEARING CORPORATION

                             By: /s/ Barry A. Morris
                             Name:  Barry A. Morris
                             Title: Chief Financial Officer

                                       14
<PAGE>

                                   SCHEDULE 1

                          INITIAL CAPITAL CONTRIBUTIONS

Member                        Initial Capital Contribution
------                        ----------------------------

NN                                  US$100,000

GBC                                 US$100,000

<PAGE>

                                   SCHEDULE 2

           INVESTMENT CAPITAL & EXPENSES RELATED TO FORMATION OF JOINT
                                     VENTURE

     Date              Description                        Amount

1. Capital

      01/00       Keybank wire-Investment on JGBR                 $2,000,000.00
                                                                  -------------

2. Expenses

      12/99       Coudert Brothers - legal service                $    7,886.37
                  Lingyan Li - trip to China to clear open issues      5,541.18

     02/00        KPMG Peat Marwick due diligence                     46,250.00
                                                                  -------------

                  Total Expenses                                  $   59,677.55
                                                                  =============

                                       16
<PAGE>

                                   SCHEDULE 3

                            INITIAL LOANS TO COMPANY

   Member                                 Initial Loans
   ------                                 -------------

     NN                                    US$2,400,000

    GBC                                      US$900,000

                                       17
<PAGE>

                                   SCHEDULE 4

                            FORM OF PROMISSORY NOTES

<PAGE>

                                 PROMISSORY NOTE

$ 2,400,000.00                                                   March 16, 2000

      FOR VALUE RECEIVED, the undersigned, NN General, LLC, a Delaware limited
liability company (the "Maker"), hereby promises to pay to the order of NN Ball
& Roller, Inc., a Delaware corporation (the "Holder"), the principal sum of
Two Million and Four Hundred Thousand Dollars ($2,400,000.00), together with
interest at the applicable federal rate as then published by the U.S. Treasury
Department, compounded annually and computed on the basis of a 365 day year, on
December 31, 2020. The Maker reserves the right to prepay all or any portion of
this Promissory Note at any time and from time to time without premium or
penalty of any kind.

      Any payment made hereunder shall be made in lawful currency of the United
States of America in immediately available funds, at 800 Tennessee Road, Erwin,
Tennessee 37650, USA, or at such other place as the Holder may designate in
writing.

      The Promissory Note may not be assigned, including by operation or law,
without the consent of the Maker.

      This Promissory Note shall be governed by and construed and enforced in
accordance with the laws of the State of New York.

      IN WITNESS WHEREOF, the undersigned had duly caused this Promissory Note
to be executed and delivered at the place specified above and as of the date
first written above.

                                          NN General, LLC

                                          By:   /s/ David L. Dyckman
                                             --------------------------------
                                          Name:  David L. Dyckman
                                                 ----------------------------
                                          Title: Manager
                                                 ----------------------------

<PAGE>

                                PROMISSORY NOTE

$ 900,000.00                                                     March 16, 2000

      FOR VALUE RECEIVED, the undersigned, NN General, LLC, a Delaware limited
liability company (the "Maker"), hereby promises to pay General Bearing
Corporation, a Delaware corporation (the "Holder"), the principal sum of Nine
Hundred Thousand Dollars ($900,000.00), together with interest at the
applicable federal rate as then published by the U.S. Treasury Department,
compounded annually and computed on the basis of a 365 day year, on December 31,
2020. The Maker reserves the right to prepay all or any portion of this
Promissory Note at any time and from time to time without premium or penalty of
any kind.

      Any payment made hereunder shall be made in lawful currency of the United
States of America in immediately available funds, at 44 High Street, West Nyack,
New York, New York 10994, USA, or at such other place as the Holder may
designate in writing.

      This Promissory Note may not be assigned, including by operation or law,
without the consent of the Maker.

      This Promissory Note shall be governed by and construed and enforced in
accordance with the laws of the State of New York.

      IN WITNESS WHEREOF, the undersigned had duly caused this Promissory Note
to be executed and delivered at the place specified above and as of the date
first written above.

                                          NN General, LLC

                                          By:   /s/ David L. Dyckman
                                          Name:  David L. Dyckman
                                          Title: Manager<PAGE>

                                                                    Exhibit 10.8

              AMENDMENT NO. 1 TO PREFERRED SHARES RIGHTS AGREEMENT

         AMENDMENT NO. 1 TO PREFERRED SHARES RIGHTS AGREEMENT (this
"Amendment"), dated as of March 5, 2000, to the Preferred Shares Rights
Agreement (the "Rights Agreement"), dated as of January 9, 1997, between
Loronix Information Systems, Inc., a Nevada corporation (the "Company"), and
American Stock Transfer & Trust Company, (the "Rights Agent").

                               W I T N E S S E T H

         WHEREAS, concurrently with the execution hereof, the Company has
entered into an Agreement and Plan of Merger among Converse Technology, Inc.
("PARENT"), a New York corporation, Comverse Acquisition Corp., a Nevada
corporation, and the Company (the "Merger Agreement") and a Stock Option
Agreement with parent; and

         WHEREAS, the Board of Directors of the Company has approved,
authorized and adopted the Merger Agreement and the transactions contemplated
thereby and, subject to certain conditions, is bound to recommend the
shareholders of the Company the approval and adoption of the Merger
Agreement; and

         WHEREAS, the Board of Directors of the Company has determined that
in connection with the Merger Agreement and the transactions contemplated
thereby, it is desirable and in the best interests of the shareholders of the
Company to amend the Rights Agreement as set forth herein; and

         WHEREAS, pursuant to Section 27 of the Rights Agreement, the Company
and the Rights Agent desire to amend the Rights Agreement as set forth herein;

         NOW, THEREFORE, the Rights Agreement is amended as follows:

         SECTION 1.        AMENDMENT.

         (a) The following subsection (e) is hereby added to Section 3 of the
Rights Agreement in its appropriate position:

                  (e) Notwithstanding any other provisions of this Agreement to
         the contrary, (i) no Distribution Date, Shares Acquisition Date or
         Triggering Event shall be deemed to have occurred, (ii) neither Parent
         nor any of its Subsidiaries (collectively, the "ACQUISITION GROUP")
         shall be deemed to have become an Acquiring Person and (iii) no holder
         of Rights shall be entitled to any rights or benefits pursuant to
         Sections 7(a), 11(a) or any other provision of this Agreement, in each
         case by reason of (x) the approval, execution, delivery and performance
         of that certain Agreement and Plan of Merger, dated as of the date
         hereof, among Converse Technology, Inc., a New York corporation
         ("Parent"), Comverse Acquisition Corp., a Nevada corporation, and the
         Company (the "MERGER AGREEMENT") by the parties thereto or that certain
         Stock Option Agreement, dated as of the date hereof, between the
         Company and Parent by the parties thereto, (y) the approval of the
         Merger Agreement by the shareholders of the Company or (z) the
         consummation of the transactions contemplated by the Merger Agreement
         or the Stock Option Agreement; PROVIDED that in the event that one or
         more members of the Acquisition Group collectively become the
         Beneficial Owner of 15% or more of the Common Shares then outstanding
         in any manner other than as set forth in the Merger Agreement or the
         Stock Option Agreement, the provisions of this sentence (other than
         this proviso) shall terminate immediately prior thereto.

         (b) Section 1(r) of the Rights Agreement is hereby deleted in its
entirety and replaced with the following:

                  (r) "EXPIRATION DATE" shall mean the earliest to occur of: (i)
         the Close of Busines on the Final Expiration Date, (ii) the Redemption
         Date, (iii) consummation of any transaction contemplated by Section
         13(f) hereof, (iv) the time at which the Board of Directors orders the
         exchange of the Rights as provided in

                                       23
<PAGE>

         Section 24 hereof, or (v) immediately prior to the Effective Time as
         such term is defined in that certain Agreement and Plan of Merger,
         dated as of March 5, 2000, by and among Comverse technology, Inc., a
         New York corporation, Comverse Acquisition Corp., a Nevada corporation,
         and the Company.

         SECTION 3. EFFECTIVENESS. This Amendment shall be deemed effective
as of the date first set forth above. Except as amended hereby, the Rights
Agreement shall remain in full force and effect and shall be otherwise
unaffected hereby.

         SECTION 4. MISCELLANEOUS. This Amendment shall be deemed to be a
contract made under the laws of the State of Nevada and for all purposes
shall be governed by and construed in accordance with the laws of such state
applicable to contracts to be made and performed entirely within such state.
This Amendment may be executed in any number of counterparts, each of such
counterparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute one and the same instrument. If any
term, provision, covenant or restriction of this Amendment is held by a court
of competent jurisdiction or other authority to be invalid, illegal, or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Amendment shall remain in full force and effect and
shall in no way be affected, impaired or invalidated.

         [The remainder of this page has been left blank intentionally.]

                                       24
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed as of the date first above written.

                                   LORONIX INFORMATION SYSTEMS, INC.

                                   By:
                                        ---------------------------------------
                                        Name:
                                        Title:

                                   AMERICAN STOCK TRANSFER & TRUST COMPANY

                                   By:
                                        ---------------------------------------
                                        Name:
                                        Title:

                                       25

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