PHOTON DYNAMICS INC
FIRST AMENDMENT TO LEASE AGREEMENT
<DOCUMENT>
<TYPE>EX-10.20
<SEQUENCE>4
<FILENAME>ex10-20.txt
<DESCRIPTION>FIRST AMENDMENT TO LEASE AGREEMENT
<TEXT>

                                                                           10.20

                                FIRST AMENDMENT
                               TO LEASE AGREEMENT
                     BETWEEN CORRIDOR PARK POINTE II, L.P.,
                                AS LANDLORD, AND
                      INTELLIGENT REASONING SYSTEMS, INC.,
                                   ASTENANT,
                            AT CORRIDOR PARK POINTE
                                   BUILDING E

STATE OF TEXAS    )

COUNTY OF TRAVIS  )

KNOW ALL PERSONS BY THESE PRESENTS:

      That the parties to this First Amendment to Lease Agreement (the
"Amendment"), are Corridor Park Pointe II, L.P., herein referred to as
"Landlord", and Intelligent Reasoning Systems, Inc., herein referred to as
"Tenant".

                              W I T N E S S E T H

      WHEREAS, Landlord and Tenant entered into a Lease Agreement (the "Lease"),
dated May 21, 1999, covering approximately 15,136 square feet (the "Premises"),
in Corridor Park Pointe Building E (the "Building"), in Austin, Texas, as more
particularly described in the Lease, and

      WHEREAS, Landlord and Tenant have agreed to modify the Lease as provided
herein.

      NOW THEREFORE, in consideration of the mutual promises and covenants set
forth herein, Landlord and Tenant agree as follows:

      1.    The Lease Term shall be revised to provide for a new expiration date
            of December 31, 2006.

      2.    The Premises, as described in Section I of the Lease, shall be
            increased in size by 20,064 square feet (the "New Premises") which,
            when combined with the Premises, will create an expanded lease space
            of approximately 35,200 square feet (the "Expanded Premises"). The
            Premises, New Premises, and Expanded Premises will be in approximate
            locations as shown on the attached Exhibit "A" to this Amendment.
            Tenant shall continue to occupy and operate out of the Premises
            until the Commencement Date of the Expanded Premises, as described
            below.

      3.    The "Commencement Date" (of the Expanded Premises) shall be deemed
            to be the earliest of. (i) the date upon which the New Premises and
            other improvements to be erected in accordance with the plans and
            specifications described in Exhibit "B" and Exhibit "B-1", attached
            hereto and incorporated herein by reference (the "Plans"), have been
            substantially completed; (ii) the date upon which the New Premises
            or such improvements would have been substantially completed but for
            the delays caused directly or indirectly by Tenant, including Plan
            delays or change orders; (iii) the date upon which Tenant occupies
            any part of the New Premises; or (iv) March 1, 2000. As used herein,
            the term "substantially completed" shall mean that, in the opinion
            of the architect or space planner that prepared the Plans, such
            improvements have been completed in accordance with the Plans and
            the New Premises are in good and satisfactory condition, with the
            exception of completion of minor punch list items. As soon as such
            improvements have been substantially completed, Landlord shall
            notify Tenant in writing that the Commencement Date of the Expanded
            Premises has occurred. Please refer to Exhibit "B" and Exhibit "B-1"
            for the responsibilities of Landlord and Tenant in the production of
            the Plans, the permitting of any construction, as well as the
            construction of the New Premises per the Plans.


                                       1.
<PAGE>

      4.    The amount of Minimum Guaranteed Rental due from Tenant on the
            Expanded Premises for each month of the extended Lease term shall be
            as follows:

                          Dates                      Minimum Guaranteed Rental
                          -----                      -------------------------
            Commencement Date - July 31, 2000      $28,374.72/mo. ($9.67/sf/yr)
            August 1, 2000 - December 31, 2000     $28,828.80/mo. ($9.83/sf/yr)
            January 1, 2001 - December 31, 2001    $29,079.60/mo ($9.91/sf/yr)
            January 1, 2002 - December 31, 2002    $29,395.80/mo. ($10.02/sf/yr)
            January 1, 2003 - December 31, 2003    $31,397.52/mo  ($10.70/sf/yr)
            January 1, 2004 - December 31, 2004    $32,102.40/mo. ($10.94/sf/yr)
            January 1, 2005 - December 31, 2006    $33,440.00/mo. ($11.40/sf/yr)

            Tenant will continue to pay Common Area Maintenance (CAM),
            Insurance, Property Taxes and Management Fees each month as provided
            in the Lease and as estimated by Landlord from time to time with
            Tenant's pro rata share of such expenses being based upon the square
            footage of the Expanded Premises beginning with the Commencement
            Date as defined above.

      5.    Landlord and Tenant agree that the Right of First Refusal set forth
            in Exhibit "C" of the Lease has been exercised, is of no further
            force and effect, and no further Right of First Refusal continues to
            exist for the benefit of Tenant.

      6.    Landlord and Tenant agree to revise the provisions of the Security
            Deposit, as set forth in Paragraph 2 of Exhibit "C" of the Lease.
            Beginning no later than the Commencement Date of the Expanded
            Premises, as defined above, Tenant agrees to provide Landlord, a
            Security Deposit in the form of an Irrevocable Letter of Credit
            ("Letter of Credit") in an amount equal to $100,000, for a term to
            expire five (5) years from the Commencement Date of the Expanded
            Premises. The Letter of Credit shall be issued by a financial
            institution approved by Landlord, in its sole discretion, shall be
            prepared in form acceptable to Landlord, shall serve as security for
            the Lease, and will be drafted so that Landlord can draw upon such
            Letter of Credit without any additional action should Tenant be in
            default of this Lease. Specifically, should Tenant remain in default
            of this Lease for ten (10) days after written notice of the default
            as sent by Landlord, Landlord may present evidence of such default
            and draw upon the Letter of Credit with no other action necessary.

            Tenant also agrees to provide to Landlord, no later than the
            Commencement Date of the Expanded Premises, an additional Security
            Deposit in the form of an Irrevocable Letter of Credit (the
            "Additional Letter of Credit") in an amount equal to $75,000 for a
            term to expire two (2) years from the Commencement Date of the
            Expanded Premises. The Additional Letter of Credit shall be issued
            by a financial institution approved by Landlord, in its sole
            discretion, shall be prepared in a form acceptable to Landlord,
            shall serve as security for the Lease, and will be drafted so that
            Landlord can draw upon such Letter of Credit without any additional
            action should Tenant be in default of this Lease. Specifically,
            should Tenant remain in default of this Lease for ten (10) days
            after written notice of the default as sent by Landlord, Landlord
            may present evidence of such default and draw upon the Letter of
            Credit with no other action necessary.

            None of the. construction allowance due to Tenant from Landlord
            will, as described within Exhibit "B- I" attached hereto, be payable
            until the time that Tenant has delivered to Landlord both the Letter
            of Credit and the Additional Letter of Credit referenced above. If
            either or both Letters of Credit remain undelivered upon the
            Commencement Date of the Expanded Premises, then Tenant shall be
            deemed to be in default of the Lease as described in Section 19 of
            the Lease and Landlord shall be able to avail itself of all
            available remedies, including, but not exclusively, the right to
            immediately draw upon any letter of Credit held by Landlord, with no
            additional action or notice other than that provided in the Lease.

            Tenant also agrees to deliver to Landlord, no later than 30 days
            prior to the expiration of the above referenced $100,000 Letter of
            Credit, a Security Deposit in the amount of $33,440, in cash,


                                       2.
<PAGE>

            not a Letter of Credit, which will serve as the Security Deposit for
            the remaining lease term of the Expanded Premises. If Tenant has not
            delivered the $33,440 cash Security Deposit to Landlord on the above
            stated due date, Tenant will be deemed to be in default under the
            terms of the Lease and Landlord will be able to avail itself of all
            available remedies.

            By executing this Amendment, the individual executing on behalf of
            Tenant hereby warrants and represents that he is duly authorized to
            execute and deliver this Amendment on behalf of Tenant in accordance
            with a duly adopted resolution of the corporation in accordance with
            the Articles of Incorporation and that this Amendment is binding
            upon Tenant in accordance with its terms.

            The Lease is modified herein and shall be (i) binding upon and inure
            to the benefit of the parties hereto and their respective
            successors-in-interest and assigns, if permitted; (ii) in full force
            and effect; and (iii) is hereby ratified and confirmed in its
            entirety.

All other terms and conditions of the Lease shall remain in full force and
effect.

This First Amendment to Lease does not become effective until executed and
delivered by both Landlord and Tenant.


                                       3.
<PAGE>

      IN WITNESS WHEREOF, Landlord and Tenant, acting herein by duly authorized
individuals, have caused this First Amendment to Lease to be executed in
multiple counterparts, each of which shall have the force and effect of any
original, on this the 9th day of November 1999.

WITNESS FOR LANDLORD:                   LANDLORD: CORRIDOR PARK POINTE II, L.P.,
                                                  a Delaware limited partnership
/s/ Milo Burdette
----------------------------------
                                        By: B & O Property, L.L.C., a Delaware
                                        limited Liability company, General
                                        Partner

                                             By: B & O Management Company,
                                                 L.L.C., a Delaware limited
                                                 liability company, Operating
                                                 Manager

                                                 By: /s/ C. Patrick Oles
                                                     ---------------------------
                                                     C. Patrick Oles, Jr.,
                                                     President


WITNESS FOR TENANT:                     TENANT: INTELLIGENT REASONING SYSTEMS,
                                                INC.

                                        By: /s/ Stephen R. Gunn
                                            ------------------------------------
                                             Stephen R. Gunn

/s/ Heather L. Renee
----------------------------------
Heather L. Renee                        Its: Vice President of Finance
<PAGE>

                                  EXHIBIT "A"
                     TO FIRST AMENDMENT TO LEASE AGREEMENT

                         CORRIDOR PARK POINTE II, L.P.

                               LEGAL DESCRIPTION

Legal Description of Land: A 10.229 acre tract of land in Travis County, Texas
being

Lot 1 of Corridor Park Pointe II a subdivision in Travis County, Texas,
according to the map or plat thereof, recorded in Volume 102, pgs. 257 and 258
of the Plat Records of Travis County, Texas.

                               TENANT'S PREMISES

                  Premises - approximately 15,136 square feet.
                New Premises - approximately 20,074 square feet.
             Expanded Premises - approximately 35,200 square feet.

             Site plan subject to change at Landlord's discretion.
                          Curb cuts subject to change.

                               [GRAPHIC OMITTED]
<PAGE>

                                  EXHIBIT "B"
                     TO FIRST AMENDMENT TO LEASE AGREEMENT

                         CORRIDOR PARK POINTE II, L.P.

                  DESCRIPTION OF LANDLORD'S AND TENANT'S WORK

Plans and specification for Tenant's Work must be submitted by Tenant to
Landlord within 15 days of execution of this Lease Agreement. All such Tenant's
Work shall be subject to Landlord's approval and acceptance, which shall be a
condition to any reimbursement herein provided.

<TABLE>
<CAPTION>
                              DESCRIPTION OF WORK                                  RESPONSIBILITY

                                                                              Landlord          Tenant
<S>                                                                              <C>               <C>
1)  Floor slab (except 7' leave out).                                            X
                                                                              --------          ------
2)  Sealed concrete in any storage area.                                                           X
                                                                              --------          ------
3)  Storefront: See "I" below.                                                   X
                                                                              --------          ------
4)  Interior demising partitioning, taped and bedded.                                              X
                                                                              --------          ------
5)  Final coat of paint in all areas.                                                              X
                                                                              --------          ------
6)  Standard suspended, acoustical, grid ceiling system with lay in tiles
    throughout the Expanded Premises (ceiling height shall be at least
    9.5' above finished floor. Ceiling systems are to be approved by
    Landlord prior to installation.                                                                X
                                                                              --------          ------
7)  Restroom facility shall be handicapped equipped and shall be in
    accordance with applicable City Code requirements.                           X
                                                                              --------          ------
8)  Electrical: Tenant is responsible for bringing electrical service
    from the back of the building into the Expanded Premises.  All
    electrical work shall be in accordance with applicable City Code
    requirements. Power requirements exceeding 100 amps must be approved
    by Landlord prior to Tenant commencing construction.                                           X
                                                                              --------          ------
9)  Other Utilities:
    a) Rough-in plumbing (brought to rear of building).                          X
                                                                              --------          ------
    b) Sanitary Sewer (brought to rear of building).                             X
                                                                              --------          ------
    c) Natural Gas.                                                              X
                                                                              --------          ------
    d) Hot water heater.                                                                           X
                                                                              --------          ------
10) Heating, Ventilation and Air Conditioning: (HVAC)
    a) One ton per every 325 s.f. as a minimum, gas/electric HVAC unit.                            X
                                                                              --------          ------
    b) Roof penetration for HVAC unit.                                                             X
                                                                              --------          ------
    c) Air conditioning screen as required by City Code.                                           X
                                                                              --------          ------
11) Lighting:
    a) Lighting to maintain adequate candlepower.                                                  X
                                                                              --------          ------
    b) Lighting in storage area.                                                                   X
                                                                              --------          ------
12) Rear exit metal door where required by City Code.                            X
                                                                              --------          ------
13) Any cross partition walls.                                                                     X
                                                                              --------          ------
14) Signs subject to Landlord's approval (size and other criteria to meet
    applicable City Code as well as Landlord's sign criteria).                                     X
                                                                              --------          ------
15) Trade fixtures, shelving and other work necessary for retail operations.                       X
                                                                              --------          ------
16) Application for separate metering of applicable utilities.                                     X
                                                                              --------          ------
17) All additional work not stated herein-above.                                                   X
                                                                              --------          ------
18) Plans and specifications for construction.                                                     X
                                                                              --------          ------
</TABLE>

The cost of any and all work not specifically delineated as Landlord's Work, or
any increase in cost resulting from subsequent changes, shall be the
responsibility of, and paid for by Tenant.

Tenant shall apply, or cause to be applied, for a Certificate of Occupancy upon
notification by contractor or Landlord that the Expanded Premises are ready for
occupancy.
<PAGE>

                            EXHIBIT "B" (CONTINUED)
                     TO FIRST AMENDMENT TO LEASE AGREEMENT

                         CORRIDOR PARK POINTE II, L.P.

                  DESCRIPTION OF LANDLORD'S AND TENANT'S WORK

NOTES:

A.    Tenant agrees to accept the Expanded Premises in its existing condition,
      to submit approved plans and specifications for all necessary building
      permits, and to move posthaste to finish the lease space in a good and
      workmanlike manner.

B.    Tenant shall apply for separate metering of applicable utilities in
      Tenant's own name and will be responsible for all deposits. All utilities
      shall be placed according to the City or any other governmental entity
      having jurisdiction.

C.    Tenant shall apply for a Certificate of Occupancy (or equivalent document
      as may be issued by the City) and shall deliver a copy of such to Landlord
      prior to the Commencement Date.

D.    Tenant shall supply Landlord with plans and, specifications, at Tenant's
      expense, of the proposed renovation of the Expanded Premises within
      fifteen (15) days of execution of this Lease Agreement. Tenant may not
      commence construction of the Expanded Premises until Landlord has approved
      in writing the plans and specifications.

E.    All salvage carpeting, light fixtures, doors, closure devices, HVAC, etc.,
      shall remain the property of Landlord at Landlord's option. Landlord shall
      not be liable for or warrant the serviceability of these items.

F.    All maintenance and repair of the Heating, Ventilating and Air
      Conditioning system (HVAC) during the term of this lease is the sole
      responsibility of the Tenant. Location of all HVAC units or any other roof
      mounted equipment shall be approved by Landlord's roofing contractor. Any
      penetrations in the roof or exterior walls or any other modifications to
      the Project shall be approved by Landlord prior to the commencement of the
      work.

G.    Demising wall between spaces are to be one hour fire rated, full height to
      roof deck with a closure strip at deck.

H.    The wall above the storefront on the back side of the soffit in all areas
      is to be a one hour fire rated wall, full height to roof deck with a
      closure strip at the deck.

I.    Storefront is to meet Landlord's specifications. Storefront criteria to be
      provided by Landlord.

J.    All toilet facilities should meet handicap requirements.

K.    Building signage shall conform to the sign criteria established by the
      Landlord.

L.    Power for signage, if allowed and/or required, shall be provided through
      each individual lease space by Tenant with relay connection to house light
      circuit.

M.    All utilities should be placed according to the City requirements or any
      other governmental entity having jurisdiction.

N.    All fees, permits and other charges relating to Tenant construction shall
      be the exclusive responsibility of Tenant.
<PAGE>

0.    If there are any changes by Tenant, Tenant's contractors, subcontractors
      or agents from the improvements set forth in the final plans and
      specifications referred to above, each such change must receive the prior
      written approval of Landlord. Tenant shall, upon completion of the
      improvements, furnish Landlord with an accurate "as built" plan of the
      improvements as constructed.

P.    Tenant shall supply Landlord copies of all mechanical equipment manuals,
      warranties, etc. up-request.
<PAGE>

                                 EXHIBIT "B-1"

                     TO FIRST AMENDMENT TO LEASE AGREEMENT

                         CORRIDOR PARK POINTE 11, L.P.

                  DESCRIPTION OF LANDLORD'S AND TENANT'S WORK

1.    Tenant agrees to accept the Expanded Premises in its existing "as is"
      condition (except as otherwise provided herein) and to complete the
      construction of the Expanded Premises to final form, including all utility
      connections in accordance with paragraph 2, below.

2.    Landlord shall reimburse Tenant a construction allowance of $401,280.00
      within thirty (30) days after the following events have taken place:

      a).   Approval of plans and specifications furnished by Tenant to Landlord
            within fifteen (15) days following execution of this Lease. Landlord
            shall approve or disapprove Tenant's plans and specifications within
            ten (10) days after receipt of same. Landlord's failure to approve
            or disapprove such plans and specifications within such time shall
            be deemed as approval of same;

      b).   Completion of Tenant's construction work in accordance with approved
            plans and specifications subject to Landlord's reasonable approval;

      c).   Receipt by Landlord from Tenant of a Certificate of Occupancy issued
            by the City or other municipal or governmental agency authorized to
            issue such Certificate for the Expanded Premises;

      d).   Receipt by Landlord from Tenant of a release and waiver of all
            liens, holding Landlord harmless from any obligation whatsoever
            which may be or may have been incurred by tenant, or Tenant's
            contractors or subcontractors, during the construction of the
            Expanded Premises.

      e).   Receipt by Landlord of Tenant's proof of insurance certificate,
            naming Landlord as "Additional Insured".

      f).   Receipt by Landlord of a signed "Punch List" indicating that all
            Punch List items noted in the walkthrough have been completed to
            Tenant and Landlord's reasonable satisfaction.

Landlord agrees to reimburse to Tenant the construction allowance referenced
above in no more than three (3) partial payments instead of one total payment.
Each partial reimbursement request by Tenant shall include a certification from
a registered architect that Tenants interior improvements have been completed
according to the approved plans and specifications and indicate that the
improvements have been completed to a point equal to or greater than the
proportionate amount of the total reimbursement being requested. All of the
other required events listed above must be completed prior to the final
reimbursement request by Tenant.
<PAGE>

                            EXHIBIT "B" (CONTINUED)

                     TO FIRST AMENDMENT TO LEASE AGREEMENT

                          CORRIDOR PARK POINTE II L.P.

                  DESCRIPTION OF LANDLORD'S AND TENANT'S WORK

NOTES:

Q.    Tenant shall provide Landlord with duly executed, valid and effective
      waivers of lien or release of all statutory or constitutional liens, from
      Tenant's contractor and subcontractors, holding Landlord harmless from any
      obligations which may have been incurred by Tenant or Tenant's contractor
      or subcontractors with respect to the work material furnished during the
      construction of the Leasehold improvements.

R.    Any contractor and/or subcontractors engaged by Tenant shall comply with
      all standards and regulations established by Landlord. Such contractors
      and subcontractors shall possess both general liability and workmen's
      compensation insurance prior to performing any work on the Expanded
      Premises and Landlord shall be provided proof of such insurance. Tenant's
      Work shall be conducted in such manner as to minimize Landlord's operation
      of the Project and/or use of the Project by other tenants.


</TEXT>
</DOCUMENT>
