The CIT Group/
                  Credit Finance
                  3rd Floor
                  300 S Grand Avenue
                  Los Angeles, CA  90071
                  Tel:  213 613-2500
                  Fax:  213 613-2501



  THE
  CIT

GROUP

June 7, 1999


Laser-Pacific Media Corporation
Laser Edit Inc.
PDS Video Productions, Inc.
Spectra Systems, Inc.
Pacific Film Laboratories Inc.
Pacific Video, Inc.
809 North Cahuenga Blvd.
Los Angeles, CA  90038
Attention:  James Parks, Chief Executive Officer

        Re: Loan and Security Agreements with The CIT Group/Credit Finance, Inc.
                                            - AMENDMENT NO. 8-

Gentlemen:

Reference is made to your respective Loan and Security  Agreements  wherein each
of you is a "Borrower" and The CIT Group/Credit  Finance,  Inc. is the "Lender",
all of which  Loan and  Security  Agreements  are  dated  August  3,  1992  (the
"Agreements").  Lender and each Borrower have agreed to amend the  Agreements as
follows effective  immediately.  Except as amended herein,  the Agreements shall
remain unchanged and in full force and effect.

1.           Accounts Receivable.

        Notwithstanding  any  language  in Section  5.1 of the  Agreements,  and
        provided  Borrower  is not in Default to Lender,  Borrower  shall not be
        obligated to remit proceeds of its accounts to Lender provided Lender is
        not lending against said accounts.

        If  Borrower  subsequently  desired  to  request  advances  against  the
        accounts,  Borrower  must  provide  Lender  with at least 30 days  prior
        written notice of its intention to request such advances to allow Lender
        sufficient time to conduct a field examination of Borrower's facilities,
        update its reporting and conduct any other due diligence.

2.           Field Examination Fees.

        Notwithstanding  any  language  in Section  6.13(d)  of the  Agreements,
        provided Lender is not lending against accounts and provided Borrower is
        not in Default to  Lender,  the  aggregate  Per Diem  Charges  for field
        examinations shall be limited to $5,000.00 per contract year.

3.           Minimum Borrowing Reduction.

        Section  10.1(e) of each of the  Agreements is hereby amended to provide
        that the Minimum  Borrowing shall equal the Term Loan balance,  provided
        Lender is not lending  against  accounts.  If Lender is lending  against
        accounts, the Minimum Borrowing shall be $2,000,000.00.

5.           Interest Rate Reduction.

        Section  10.4(a) of each of the  Agreements is hereby amended to read as
        follows:

        "(a)(1)  Interest Rate for Revolving Loans:   Prime Rate plus 1.0% over
                                                              a 360-day year

        (a)(2)  Interest Rate for Term Loans:         Prime Rate plus 1.0% over
                                                              a 360-day year"

6.           Facility Fee Reduction.

        Section 10.4(b) of each of the Agreements is hereby amended to eliminate
        the Facility Fee requirement.