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Letter of Credit Agreement - Sanwa Bank California and ATG Inc.

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                         LETTER OF CREDIT AGREEMENT

         This Letter of Credit Agreement (the "Agreement") is made and entered
into this 6th day of March, 1998, by and between SANWA BANK CALIFORNIA (the
"Bank") and ATG, INC. (the "Borrower").

                                  SECTION 1

1.1 Certain Defined Terms: Unless elsewhere defined in this Agreement, the
following terms shall have the following meanings (such meanings to be generally
applicable to the singular and plural forms of the terms defined):

         a. "Business Day" shall mean a day other than a Saturday
         or Sunday on which the Bank is open for business in Oakland,

         b. "Collateral" shall mean the property described in Section 6.1,
         together with any other personal or real property in which the Bank may
         be granted a lien or security interest to secure payment of the

         c. "Credit Line" shall mean Two Million dollars ($2,000,000.00).

         d. "Debt" shall mean all liabilities of the Borrower.

         e. "Debt" shall mean the presentation of a draft(s) together with any
         accompanying documents by a beneficiary under a Letter of Credit to
         seeking payment under such Letter of Credit.

         f. "Effective Tangible Net Worth" shall mean the Borrower's stated net
         worth plus Subordinated Debt but less all intangible assets of the
         Borrower (i.e., goodwill, trademarks, patents, copyrights, organization
         expense and similar intangible items including, but not limited to
         trade notes receivable, loans to officers and employees, and loans due
         from Affiliates).

         g. "Environmental Claims" means all claims, however asserted, by any
         Governmental Authority or other Person alleging potential liability or
         responsibility for violation of any Environmental Law or for release or
         injury to the environment or threat to public health, personal injury
         (including sickness, disease or death), property damage,
         natural resources damage, or otherwise alleging liability or
         responsibility for damages (punitive or otherwise), cleanup, removal,
         remedial or response costs, restitution, civil or criminal penalties,
         injunctive relief, or other type of relief, resulting from or based
         upon (a) the presence, placement, discharge, emission or release
         (including intentional and unintentional, negligent and non-negligent,
         sudden or non-sudden, accidental or non-accidental placement, spills,
         leaks, discharges, emissions or releases) of any Hazardous Material at,
         in, or from Property, whether or not owned by the Borrower, or (b) any
         other circumstances forming the basis of any violation, or alleged
         violation, of any Environmental Law.

         h. "Environmental Laws" means all federal, state or local laws,
         statutes, common law duties, rules, regulations, ordinances and codes,
         together with all administrative orders, directed duties, requests,
         licenses, authorizations and permits of, and agreements with, any
         Governmental Authorities, in each case relating to environmental,
         health, safety and land use matters; including the Comprehensive
         Environmental Response, Compensation and Liability Act of 1980
         ("CERCLA), the Clean Air Act, the Federal Water Pollution Control Act
         of 1972, the Solid Waste Disposal Act, the Federal Resource
         Conservation and Recovery Act, the Toxic Substances Control Act, the
         Emergency Planning and Community Right-to-Know Act, the California
         Hazardous Waste Control Law, the California Solid 

         Waste Management, Resource, Recovery and Recycling Act, the
         California Water Code and the California Health and Safety Code.

         i. "ERISA" shall mean the Employee Retirement Income Security Act of
         1974, as amended from time to time, including (unless the context
         otherwise requires) any rules or regulations promulgated thereunder.

         j. "Event of Default" shall have the meaning set forth in Section 10.

         k. "Expiration Date" shall mean September 30, 1998, or the date of
         termination of the Bank's commitment to lend under this Agreement
         pursuant to Section 11, whichever shall occur first.

         l. "GAAP" shall mean generally accepted accounting principles set forth
         from time to time in the opinions and pronouncements of the Accounting
         Principles Board and the American Institute of Certified Public
         Accountants and statements, and pronouncements of the Financial
         Accounting Standards Board (or agencies with similar functions of
         comparable stature and authority within the accounting
         profession), or in such other statements by such other entity as may
         be in general use by significant segments of the U.S. accounting
         profession, which are applicable to the circumstances as of the date
         of determination.

         m. "Guarantor" shall mean each of those individuals and/or entities
         identified in Section 6.2.

         n. "Hazardous Materials" means all those substances which are regulated
         by, or which may form the basis of liability under, any Environmental
         Law, including all substances identified under any Environmental Law as
         a pollutant, contaminant, hazardous waste, hazardous constituent,
         special waste, hazardous substance, hazardous material, or toxic
         substance, or petroleum or petroleum derived substance or waste.

         o. "Indebtedness" shall mean, with respect to the Borrower, (i) all
         indebtedness for borrowed money or for the deferred purchase price of
         property or services in respect of which the Borrower is liable,
         contingently or otherwise, as obligor, guarantor or otherwise, or in
         respect of which the Borrower otherwise assures a creditor against loss
         and (ii) obligations under leases which shall have been or should be,
         in accordance with GAAP, reported as capital leases in respect of which
         the Borrower is liable, contingently or otherwise, or in respect of
         which the Borrower otherwise assures a lessor against loss.

         p. "Letter of Credit" shall mean a letter of credit issued by Bank
         pursuant to Section 2.

         q. "Letter of Credit Obligations" shall mean, at any time, the
         aggregate obligations of the Borrower then outstanding, or which may
         thereafter arise in respect of Letters of Credit then issued by Bank,
         to reimburse the amount paid by the Bank with respect to a past,
         present or future Drawing under Letters of Credit.

         r. "Obligations" shall mean all amounts owing by the Borrower to the
         Bank Pursuant to this Agreement.

         s. "Permitted Liens" shall mean: (i) liens and security interests
         securing indebtedness owed by the Borrower to the Bank; (ii) liens for
         taxes, assessments or similar charges either not yet due or being
         contested in good faith; (iii) liens of materialmen, mechanics,
         warehousemen, or carriers or other like liens arising in the ordinary
         course of business and securing obligations which are not yet
         delinquent; (iv) purchase money liens or purchase money security
         Interests upon or in any properly acquired or held
         by the Borrower in the ordinary course of business to secure
         Indebtedness outstanding on the 

         date hereof or permitted to be incurred under Section 10 hereof; (v)
         liens on equipment leased by the Borrower provided the aggregate
         amount of such leases complies with Section 10 hereof; (vi) liens and
         security interests which, as of the date hereof, have been disclosed
         to and approved by the Bank in writing; and (vii) those liens and
         security interests which in the aggregate constitute an immaterial
         and insignificant monetary amount with respect to the net value of
         the Borrower's assets.

         t. "Reference Rate" shall mean an index for a variable interest rate
         which is quoted, published or announced from time to time by the Bank
         as its reference rate and as to which loans may be made by the Bank at,
         below or above such reference rate.

         u. "Sight Credit" means a Letter of Credit, the terms of which require
         the Bank to make payment upon presentation of conforming documents.

1.2 Accounting Terms: All references to financial statements, assets,
liabilities, and similar accounting items not specifically defined herein shall
mean such financial statements or such items prepared or determined in
accordance with generally accepted accounting principles consistently applied
and, except where otherwise specified, all financial data submitted pursuant to
this Agreement shall be prepared in accordance with such principles.

1.3 Other Terms: Other terms not otherwise defined shall have, the meanings
attributed to such terms in the California Uniform Commercial Code.

                                  SECTION 2
                              LETTERS OF CREDIT

2.1 Sight Credits. Subject to Section 5.1. the Bank hereby agrees to issue Sight
Credits for and on behalf of Borrower for the purpose of credit enhancement for
numerous bonding requirements to obtain government contracts.

2.2      Letter of Credit General Conditions.

         a. As a condition precedent to Bank's obligation to issue any Letter of
         Credit hereunder, the Borrower shall pay to the Bank its standard
         issuance fees and shall promptly pay, upon request, such other fees,
         commissions, costs and any out-of-pocket expenses charged or incurred,
         by the Bank with respect to any Letter of Credit.

         b. The commitment by the Bank to issue Letters of Credit shall, unless
         earlier terminated in accordance with the terms of the Agreement,
         automatically terminate on the Expiration Date and no Letter of Credit
         shall expire, and no draft under a Letter of Credit shall be payable,
         on a date which is after the Expiration Date.

         c. Each Letter of Credit shall be in form and substance satisfactory to
         the Bank and in favor of beneficiaries satisfactory to the Bank,
         provided that the Bank may refuse to issue a Letter of Credit due to
         the nature of the "transaction or its terms or in connection with any
         transaction where the Bank, due to the beneficiary or the nationality
         or residence of the beneficiary, would be prohibited by any applicable
         law, regulation or order from issuing such Letter of Credit.

         d. Prior to the issuance of each Letter of Credit, but in no event
         later than 10:00 a.m. (California time) on the day such Letter of
         Credit is to be issued (which shall be a Business Day), the Borrower
         shall deliver to the Bank the Bank's standard form of application for
         issuance of a letter of credit with proper insertions, duly executed by

2.3 Drawings: Upon receipt from any beneficiary under a Letter of Credit of a
demand for payment under such Letter of Credit (each a "Drawing"), the Bank
shall promptly notify the Borrower. Borrower promises and agrees to immediately
reimburse the Bank for any amounts paid the Bank pursuant to a Drawing. In the
event the Borrower shall fail to reimburse the Bank for a Drawing and without
waiving any Event of Default occasioned by such failure, the Borrower promises
and agrees to pay interest on the amount of such Drawing at a rate equal to the
Reference rate plus one percent (1%) per annum, calculated on the basis of 360
day per year but charged on the actual number of days elapsed, said rate of
interest to be adjusted concurrently with any change in the Reference Rate.

                                  SECTION 3

                                  SECTION 4

                                  SECTION 5

                                  SECTION 6
                       OTHER LOAN TERMS AND CONDITIONS

6.1 The Collateral: To secure payment and performance of all the Borrower's
Obligations under this Agreement and all other liabilities, loans, guarantees,
covenants and duties owed by the Borrower to the Bank, whether or not evidenced
by this or by any other agreement, absolute or contingent, due or to become due,
now existing or hereafter and howsoever created, the Borrower hereby grants the
Bank a security interest in and to all of the following property:

         Cash collateral of 50% of the amount outstanding of all letters of
         credit in account number 1137-58446 or in any other monies, deposit
         accounts, certificates of deposit and securities of the Borrower now or
         hereafter in the Bank's or its agents' possession.

The Bank's security interest in the Collateral shall be a continuing lien and
shall include the proceeds and products of the Collateral including, but not
limited to, the proceeds of any insurance thereon.

6.2 Guarantees: All of Borrower's Obligations and the full and timely
performance by Borrower hereunder shall be unconditionally guaranteed in
writing, in form and substance satisfactory to Bank (the "Guarantee"), by Doreen
Chiu, Frank Chiu, and ATG Richland, each in the amount of $8,000,000 (each a

6.3 Commitment Fee: Borrower promises and agrees to pay to Bank (i) a commitment
fee (the "Commitment Fee") of 1.25% annually, pro-rated from the date of this
Agreement to the Expiration Date, payable concurrently with the execution of
this Agreement.

6.4 Costs. Borrower shall, upon Bank's request, promptly pay to and reimburse
the Bank for all costs incurred and payments made by the Bank by reason of any
future assessment, reserve, deposit or similar requirements or any surcharge,
tax or fee imposed upon the Bank or as a result of the Bank's compliance with
any directive or requirement of any regulatory authority pertaining or relating
to any Import Letter of Credit or Acceptance.

                                  SECTION 7
                            CONDITIONS OF LENDING

7.1 Conditions Precedent to the Initial Extension of Credit: The obligation of
the Bank to issue the Initial Letter of Credit to, for or on account of the
Borrower hereunder is subject to the conditions precedent that the Bank shall
have received before the date of such initial Letter of Credit all of the
following, in form and substance satisfactory to the Bank:

         a. Evidence that the execution, delivery and performance
         by the Borrower of this Agreement and any document,
         instrument or agreement required hereunder have been duly

         b. The Guarantee described in Sections 6.2 and 6.4 respectively.

         c. The Commitment Fee described in Section 6.3.

         d. Evidence satisfactory to Bank that its security interest in the
         Collateral is perfected and has priority over all other security
         interests and liens except those which may otherwise be approved by the

         e. Such other evidence as the Bank may request to establish the
         consummation of the transaction contemplated hereunder and compliance
         with the conditions of this Agreement.

7.2 Conditions Precedent to All Extensions of Credit: The obligation of the Bank
to issue each Letter of Credit to, for or on account, of the Borrower (including
the initial Letter of Credit) shall be subject to the further conditions
precedent that, or, on the date of each Letter of Credit and after the making,
issuance or creation thereof:

         a. The Bank shall have received current reports, certifications and
         information required under Section 9.7.

         b. The Bank shall have received such supplemental approvals, opinions
         or documents as the Bank may reasonably request.

         c. The representations contained in Section 8 and in any other
         document, instrument or certificate delivered to the Bank hereunder are

         d. No event has occurred and is continuing which constitutes, or, with
         the lapse of time or giving of notice or both, would constitute an
         Event of Default.

         e. The Bank's security interest in the Collateral has been duly
         authorized, created and perfected, is of first priority and is in full
         force and effect.

         f. The Guaranties and are each in full force and effect.

7.3 Affirmation. The Borrower's acceptance of the proceeds of any Advance or
Acceptance or applying for any Letter of Credit shall be deemed to constitute
the Borrower's representation and warranty that all of the above conditions
precedent have been satisfied.

                                  SECTION 8

The Borrower hereby makes the following representations and warranties to the
Bank, which representations and warranties are continuing:

8.1 Status: Borrower is a corporation duly organized and validly existing under
the laws of the State of California, and is properly licensed and is qualified
to do business and in good standing in all jurisdictions in which such
qualification or licensing is required or in which the failure to so qualify or
to be so licensed could have a material adverse effect on Borrower; Borrower has
all necessary powers, authority, rights and franchises to own its property and
to carry on its business as now conducted. Borrower has no subsidiaries.

8.2 Authority: The execution, delivery and performance by the Borrower of this
Agreement and any instrument, document or agreement required hereunder have been
duly authorized and do not and will not: (i) violate any provision of any law,
rule, regulation, order, writ, judgment, injunction, decree, determination or
award presently in effect having application to the Borrower; (ii) result In a
breach of or constitute a default under any material indenture or loan or credit
agreement or other material agreement, lease or instrument to which the Borrower
is a party or by which it or its properties may be bound or affected: or (iii)
require any consent or approval of its stockholders or violate any provision of
its articles of incorporation or by-laws, if the Borrower is a corporation; or
(iv) violate any provision of its partnership agreement, if the Borrower is a

8.3 Legal Effect. This Agreement constitutes, and any instrument, document or
agreement required hereunder when delivered hereunder will constitute, legal,
valid and binding obligations of the Borrower enforceable against the Borrower
in accordance with their respective terms.

8.4 Fictitious Trade Styles: Borrower is not, at present, doing business under
or using any trade style in connection with its business operations. The
Borrower shall notify the Bank not less than 30 days prior to using any other
fictitious trade style at any future date, indicating the trade style and
state(s) of its use.

8.5  Financial Statements: All financial statements, information and other
data which may have been and which may hereafter be submitted by the Borrower
to the Bank are true, accurate and correct and have been and will be prepared
in accordance with GAAP consistently applied and accurately represent the
financial condition and, as applicable, the other information disclosed
therein. Since the most recent submission of such financial information and
data to the Bank, the Borrower represents and warrants that no material
adverse change in the Borrower's financial condition or operations has
occurred which has not been fully disclosed to the Bank in writing.

8.6 Litigation: There are no, actions, suits or proceedings pending or, to the
knowledge of the Borrower, threatened against or affecting the Borrower or the
Borrower's properties before any court or administrative agency which, if
determined adversely to the Borrower, would have a material adverse effect on
the Borrower's financial condition or operations or on the Collateral.

8.7 Title to Assets: The Borrower has good and marketable title to all of its
assets (including, but not limited to, the Collateral) and the same are not
subject to any security interest, encumbrance, lien or claim of any third person
except for Permitted Liens.

8.8 ERISA: If the Borrower has a pension, profit sharing or retirement plan
subject to ERISA, such plan has been and will continue to be funded in
accordance with its terms and otherwise complies with and continues to comply
with the requirements of ERISA.

8.9 Taxes: The Borrower has filed all tax returns required to be filed and paid
all taxes shown thereon to be due, including interest and penalties, other than
such taxes which are currently payable without penalty or interest or those
which are being duly contested in good faith.

8.10 Environmental Matters. (a) The operations of the Borrower complies, and
during the term of this Agreement will at all times comply, in all respects with
all Environmental Laws, the Borrower has obtained all licenses, permits,
authorizations and registrations required under any Environmental Law
("Environmental Permits") and necessary for its ordinary course operations, all
such Environmental Permits are in good standing, and the Borrower is in
compliance with all material terms and conditions of such Environmental Permits;
neither the Borrower nor any of its present Property or operations is subject to
any outstanding written order from or agreement with any governmental authority
nor subject to any judicial or docketed administrative proceeding, respecting
any Environmental Law, Environmental Claim or Hazardous Material; there are no
Hazardous Materials or other conditions or circumstances existing, or arising
from operations prior to the date of this Agreement, with respect to any
Property of the Borrower that would reasonably be expected to give rise to
Environmental Claims; provided, however, that with respect to Property leased
from an unrelated third party, the foregoing representation is made to the
best knowledge of the Borrower. In addition, (i) the Borrower does not have
any underground storage tanks (x) that are not properly registered or
permitted under applicable Environmental Laws, or (y) that are leaking or
disposing of Hazardous Materials off-site, and (ii) the Borrower has notified
all of their employees of the existence, if any, of any health hazard arising
from the conditions of their employment and have met all notification
requirements under Title III of CERCLA and all other Environmental Laws.

                                  SECTION 9

The Borrower covenants and agrees that, during the term of this Agreement, and
so long thereafter as the Borrower is indebted to the Bank under this Agreement,
the Borrower will, unless the Bank shall otherwise consent in writing:

9.1 Preservation of Existence; Compliance with Applicable Laws: Maintain and
preserve its existence and all rights and privileges now enjoyed; not liquidate
or dissolve, merge or consolidate with or into, or acquire any other business
organization; and conduct its business and operations in accordance with all
applicable laws, rules and regulations.

9.2 Maintenance of Insurance: Maintain insurance in such amounts and covering
such risks as is usually carried by companies engaged in similar businesses and
owning similar properties in the same general areas in which the Borrower
operates and maintain such other insurance and coverages as may be required by
the Bank.

9.3 Payment of Obligations and Taxes: Make timely payment of all assessments and
taxes and all of its liabilities and obligations including, but not limited to,
trade payables, unless the same are being contested in good faith by appropriate
proceedings with the appropriate court or regulatory agency. For purposes
hereof, the Borrower's issuance of a check, draft or similar instrument without
delivery to the intended payee shall not constitute payment.

9.4 Inspection Rights. At any reasonable time and from time to time, permit the
Bank or any representative thereof to examine and make copies of the records and
visit the properties of the Borrower and discuss the business and operations of
the Borrower with any employee or representative, thereof. If the Borrower shall
maintain any records (including, but not limited to, computer generated
records or computer programs for the generation of such records) in the
possession of a third party, the Borrower hereby agrees to notify such third
party to permit the Bank free access to such records at all reasonable times
and to provide the Bank with copies of any records which it may request, all
at the Borrower's expense, the amount of which shall be

payable immediately upon demand. In addition, the Bank may, at any reasonable
time and from time to time, conduct inspections and audits of the Collateral
and the Borrower's accounts payable, the cost and expenses of which shall be
paid by the Borrower to the Bank upon demand.

9.5      Reporting and Certification Requirements.  Deliver or cause
to be delivered to the Bank in form and detail satisfactory to
the Bank:

         a. Not later than 120 days after the end of each of the Borrower's
         fiscal years, a copy of the Borrower's corporate tax return for the
         year just ended and a copy of the Borrower's annual financial report
         for such year which report shall be CPA audited.

         b. Not later than 30 days after the end of each of Borrower's quarter
         for the first three quarters, the Borrower's financial statement as of
         the end of such period which report shall be company prepared.

         c. Not later than April 1, 1998, a certified copy of the financial
         statement of the Guarantor who is an individual and a copy of such
         Guarantor's federal and state income tax returns for the year just

         d. Not later than 304 days after Guarantor's fiscal year end (for each
         Guarantor who is other than an individual), a certified copy of the
         financial statement for such Guarantor which financial statement shall
         be company prepared and within 10 days of filing, a copy of such
         Guarantor's federal and state income tax returns.

         e. Promptly upon the Bank's request, such other information pertaining
         to the Borrower, the Collateral or any Guarantor hereunder as the Bank
         may reasonably request.

9.6 Additional Indebtedness: Not, after the date hereof, create, incur or
assume, directly or indirectly, any additional Indebtedness in excess of
$2,000,000.00 outstanding at any time other than (i) indebtedness owed or to be
owed to the Bank; or (ii) indebtedness to trade creditors incurred in the
ordinary course of the Borrower's business as conducted as of the date of this

9.7 Loans: Not make any loans or advances or extend credit to any third person
in excess of $500,000.00, including, but not limited to, directors, officers,
shareholders, employees, affiliated entities and subsidiaries of the Borrower,
except for credit extended in the ordinary course of the Borrower's business as
presently conducted.

9.8 Liens and Encumbrances: Not create, assume or permit to exist in excess of
$2,000,000.00 any security interest, encumbrance, mortgage, deed of trust, or
other lien (including, but not limited to, a lien of attachment, judgment or
execution) affecting any of the Borrower's properties or assets (including but
not limited to any and all patents, trademarks, trade styles and trade names),
or execute or allow to be filed any financing statement or continuation thereof
affecting any of such properties, except for Permitted Liens or as otherwise
provided in this Agreement.

9.9 Compensation of Employees: Compensate its employees for services rendered at
an hourly rate at least equal to the minimum hourly rate prescribed by any
applicable federal state law or regulation.

9.10 Capital Expense: Not make any investment in fixed assets or fixed capital
expenditures, including, but not limited to, incurring liability for leases
which would be, in accordance with generally accepted accounting principles,
reported as capital leases, or purchase any real or personal property in an
aggregate amount exceeding $4,000,000.00 in any one fiscal year.

9.1 Redemption or Repurchase of Stock: Not redeem or repurchase any class of the
Borrower's stock now or hereafter outstanding.

9.32 Payment of Dividends. Borrower will not declare or pay any dividends on any
class of stock now or hereafter outstanding except dividends payable solely in
the Borrower's capital stock.

9.13 Transfer Assets: Not, after the date hereof, sell, contract for sale,
convey, transfer, assign, lease or sublet, any of its assets (including, but not
limited to, the Collateral and any and all patents, trademarks, trade styles and
trade names) except in the ordinary course of business as presently conducted by
the Borrower and, then, only for full, fair and reasonable consideration.

9.14 Change in Nature of Business: Not make any material change in its financial
structure or the nature of its business as existing or conducted as of the date

9.15     Financial Condition:  Maintain at all times:

         a. A minimum Effective Tangible Net Worth of at least $13,250,000.00.

         b. A ratio of Debt to Effective Tangible Net Worth of not more than
         1.15 to 1.

         c. A ratio of current assets to current liabilities of not less than
         1.3 to 1.

         d. No two consecutive quarter losses.

         e. A minimum debt service coverage ratio of the sum of net profit after
         tax plus depreciation and amortization (and term interest expense),
         less dividends, distributions and withdrawals, divided by the current
         portion of long term debt (plus term interest expense) of 1.05 to 1.

9.16 Compensation of Employees: Compensate its employees for services rendered
at an hourly rate at least equal to the minimum hourly rate prescribed by any
applicable federal or state law or regulation.

9.17     Notice:  Give prompt written notice to the Bank of:

         a. any and all Events of Default;

         b. any and all litigation, arbitration or administrative proceedings to
         which the Borrower is a party and in which the claim or liability
         exceeds $100,000.00; and

         c. upon, but in no event later than 10 days after, becoming aware of
         (i) any enforcement, cleanup, removal or other governmental or
         regulatory actions instituted, completed or threatened against the
         Borrower or any of its Subsidiaries or any of their respective
         Properties pursuant to any applicable Environmental Laws, (ii) all
         other Environmental Claims, and (iii) any environmental or similar
         condition on any real property adjoining or in the vicinity of the
         property of the Borrower or any Subsidiary that could reasonably be
         anticipated to cause such property or any part thereof to be subject to
         any restrictions on the ownership, occupancy, transferability or use of
         such property under any Environmental Laws.

9.18 Environmental Laws. The Borrower shall conduct its operations and keep and
maintain all of its property in compliance with all Environmental Laws and, upon
the written request of the Bank, the Borrower shall submit to the Bank, at the
Borrower's sole cost and expense, at reasonable intervals, a report providing
an update of the status of any environmental, health or safety compliance,
hazard or liability issue identified in any notice or report required pursuant
to Section 9.17C.

                                 SECTION 10
                              EVENTS OF DEFAULT

Any one or more of the following described events shall constitute an event of
default (an "Event of Default") under this Agreement:

10.1 Non-Payment: The Borrower shall fail to pay any Obligations within ten (10)
days of when due.

10.2 Performance Under This and Other Agreements: The Borrower shall fail in any
material respect to perform or observe any term, covenant or agreement contained
in this Agreement or in any document, instrument or agreement evidencing or
relating to any indebtedness of the Borrower (whether such indebtedness is owed
to the Bank or third persons), and any such failure (exclusive of the payment of
money to the Bank under this Agreement or under any other instrument, document
or agreement, which failure shall constitute and be an immediate Event of
Default if not paid when due or when demanded to be due) shall continue for more
than fifteen (15) days after written notice from the Bank to the Borrower of the
existence and character of such Event of Default.

10.3 Representations and Warranties; Financial Statements: Any representation or
warranty made by the Borrower under or in connection with this Agreement or any
financial statement given by the Borrower or any guarantor shall prove to have
been incorrect in any material respect when made or given or when deemed to have
been made or given.

10.4 Insolvency: The Borrower or any Guarantor shall: (i) become insolvent or be
unable to pay its debts as they mature; (ii) make an assignment for the benefit
of creditors or to an agent authorized to liquidate any substantial amount of
its properties and assets; (iii) file a voluntary petition in bankruptcy or
seeking reorganization or to effect a plan or other arrangement with creditors;
(iv) file an answer admitting the material allegations of an involuntary
petition relating to bankruptcy or reorganization or join in any such petition;
(v) become or be adjudicated a bankrupt; (vi) apply for or consent to the
appointment of, or consent that an order be made, appointing any receiver,
custodian or trustee, for itself or any of its properties, assets, or
businesses; or (vii) any receiver, custodian or trustee shall have been
appointed for all or substantial part of its properties, assets or businesses
and shall not be discharged within 30 days after the date of such appointment.

10.5 Execution: Any writ of execution or attachment or any judgment lien shall
be issued against any property of the Borrower and shall not be discharged or
bonded against or released within 30 days after the issuance or attachment of
such writ or lien.

10.6 Revocation or Limitation of Guaranty and/or Subordination: Any Guaranty or
Subordination Agreement shall be revoked or limited or its enforceability or
validity shall be contested by any Guarantor or Creditor, by operation of law,
legal proceeding or otherwise or any Guarantor who is a natural person shall

10.7 Suspension: The Borrower shall voluntarily suspend the transaction of
business or allow to be suspended, terminated, revoked or expired any permit,
license or approval of any governmental body necessary to conduct the Borrower's
business as now conducted.

10.8 Change in Ownership: There shall occur a sale, transfer, disposition or
encumbrance (whether voluntary or involuntary), or an agreement shall be entered
into to do so, with respect to more than 10% of the issued and outstanding
capital stock of the Borrower, if a corporation, or there shall occur a change
in any general partner or a change affecting the control of the Borrower, if a

                                 SECTION 11
                             REMEDIES ON DEFAULT

Upon the occurrence of any Event of Default, the Bank may, at its sole and
absolute election, without demand and only upon such notice as may be required
by law:

11.1 Acceleration: Declare any or all of the Borrower's indebtedness Owing to
the Bank, whether under this Agreement or any other document, instrument or
agreement, immediately due and payable, whether or not otherwise due and

11.2 Letter of Credit Collateralization: Require Borrower to deposit with Bank
an amount equal to the then existing Letter of Credit Obligations.

11.3 Cease Extending Credit: Cease issuing Letter of Credit or otherwise
extending credit to or for the account of the Borrower under this Agreement or
under any other agreement now existing or hereafter entered into between the
Borrower and the Bank.

11.4 Termination: Terminate this Agreement as to any future obligation of the
Bank without affecting the Borrower's obligations to the Bank or the Bank's
rights and remedies under this Agreement or under any other document,
instrument or agreement.

11.5 Protection of Security Interest: Make such payments and do such acts as the
Bank, in its sole judgment, considers necessary and reasonable to protect its
security interest or lien in the Collateral. The Borrower hereby irrevocably
authorizes the Bank to pay, purchase, contest or compromise any encumbrance,
lien or claim which the Bank, in its sole judgment, deems to be prior or
superior to its security interest. Further, the Borrower hereby agrees to pay to
the Bank, upon demand therefor, all expenses and expenditures (including
attorneys' fees) incurred in connection with the foregoing.

11.6 Foreclosure: Enforce any security interest or lien given or provided for
under this Agreement or under any security agreement, mortgage, deed of trust or
other document, in such manner and such order, as to all or any part of the
properties subject to such security interest or lien, as the Bank, in its sole
judgment, deems to be necessary or appropriate and the Borrower hereby waives
any and all rights, obligations or defenses now or hereafter established by law
relating to the foregoing. In the enforcement of its security interest or lien,
the Bank is authorized to enter upon the premises where any Collateral is
located and take possession of the Collateral or any part thereof, together with
the Borrower's records pertaining thereto, or the Bank may require the Borrower
to assemble the Collateral and records pertaining thereto and make such
Collateral and records available to the Bank (including a copy of the Borrower's
customer lists) at a place designated by the Bank. The Bank may sell the
Collateral or any portions thereof, together with all additions, accessions and
accessories thereto, giving only such notices and following only such procedures
as are required by law, at either a public or private sale, or both, with or
without having the Collateral present at the time of the sale, which sale shall
be on such terms and conditions and conducted in such manner as the Bank
determines in its sole judgment to be commercially reasonable. Any deficiency
which exists after the disposition or liquidation of the Collateral shall be a
continuing liability of the Borrower to the Bank and shall be immediately paid
by the Borrower to the Bank.

11.7 Non-Exclusivity of Remedies: Exercise one or more of the Bank's rights set
forth herein or seek such other rights or pursue such other remedies as may be
provided by law, in equity or in any other agreement now existing or hereafter
entered into between the Borrower and the Bank, or otherwise.

11.8 Application of Proceeds: All amounts received by the Bank as proceeds from
the disposition or liquidation of the Collateral shall be applied to the
Borrower's indebtedness to the Bank as follows: first, to the costs and
expenses of collection, enforcement, protection and preservation of the Bank's
lien in the Collateral,

including court costs and reasonable attorneys' fees, whether or not suit is
commenced by the Bank; next, to those costs and expenses incurred by the Bank
in protecting, preserving, enforcing, collecting, liquidating, selling or
disposing of the Collateral; next, to the payment of accrued and unpaid
interest on all of the Obligations; next, to the payment of the outstanding
principal balance of the Obligations; and last, to the payment of any other
indebtedness owed by the Borrower to the Bank. Any excess Collateral or excess
proceeds existing after the disposition or liquidation of the Collateral and
after the expiration of all outstanding Letters of Credit will be returned or
paid by the Bank to the Borrower.

                                 SECTION 12

12.1 Amounts Payable on Demand: If the Borrower shall fall to pay on demand any
amount so payable under this Agreement (including but not limited to interest),
the Bank may, at its option and without any obligation to do so and without
waiving any default occasioned by the Borrower having so failed to pay such
amount, create an Advance under the Line of Credit in an amount equal to the
amount so payable, which Advance shall thereafter bear interest as provided
under the Line of Credit.

12.2 Reliance: Each warranty, representation, covenant, obligation and agreement
contained in this Agreement shall be conclusively presumed to have been relied
upon by the Bank regardless of any investigation made or information possessed
by the Bank and shall be cumulative and in addition to any other warranties,
representations, covenants and agreements which the Borrower now or hereafter
shall give, or cause to be given, to the Bank.

12.3 Attorneys' Fees: In the event of any dispute or legal action in relation to
this Agreement or any document, instrument or agreement executed with respect
to, evidencing or securing the Obligations, Borrower, in the case of a dispute,
or the prevailing party, in the case of a legal action, shall, in addition to
all other sums to which it may be entitled, be entitled to reasonable attorneys'

12.4 Notices: All notices, payments, requests, information and demands which
either party hereto may desire, or may be required to give or make to the other
party hereto, shall be given or made to such party by hand delivery or through
deposit in the United States mail, postage prepaid, or by Western Union
telegram, addressed as set forth below or to such other address as may be
specified from time to time in writing by either party to the other.

To the Borrower:                                     To the Bank

ATG, INC.                                            SANWA BANK CALIFORNIA
47375 Fremont Boulevard                              Oakland Main Office
Fremont, CA 94538                                    2127 Broadway
                                                     Oakland, CA 94612
Attn. Doreen Chiu
                                                     Attn: John Norawong

12.5 Waiver: Neither the failure nor delay by the Bank in exercising any right
hereunder or under any document, instrument or agreement mentioned herein shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right hereunder or under any other document, instrument or agreement mentioned
herein preclude other or further exercise thereof or the exercise of any other
right; nor shall any waiver of any right or default hereunder, or under any
other document, instrument or agreement mentioned herein, constitute a waiver of
any To the Bank; other right or default or constitute a waiver of any other
default of the same or any other term or provision.

12.6 Conflicting Provisions: To the extent the provisions contained in this
Agreement are inconsistent with those contained in any other document,
instrument or agreement executed pursuant hereto, the terms and provisions
contained herein shall control. Otherwise, such provisions shall be considered


12.8 Binding Effect; Assignment: This Agreement shall be binding upon and
inure to the benefit of the Borrower and the Bank, and their respective
successors and assigns, except that the Borrower shall not have the right to
assign its rights hereunder or any interest herein without the prior written
consent of the Bank. The Bank may sell, assign or grant participation in all
or any portion of its rights and benefits hereunder. The Borrower agrees that,
in connection with any such sale, grant or assignment, the Bank may deliver to
the prospective buyer, participant or assignee financial statements and other
relevant information relating to the Borrower and any guarantor.


12.10 Headings: The headings herein set forth are solely for the purpose of
identification and have no legal significance.

12.11 Entire Agreement: This Agreement and all documents, instruments and
agreements mentioned herein constitute the entire and complete understanding of
the parties with respect to the transactions contemplated hereunder. All
previous conversations, memoranda and writings between the parties pertaining to
the transactions contemplated hereunder not incorporated or referenced in this
Agreement or in such documents, instruments and agreements are superseded

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first hereinabove written.

BANK:                                     BORROWER:
SANWA BANK CALIFORNIA                     ATG, INC.
By:                                       By:
   -------------------------------------     ---------------------------------
         John Norawong, Vice President